5 Most Profitable Undervalued Stocks to Buy Now

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1. PDD Holdings Inc. (NASDAQ:PDD)

On April 16, 2026, Arete upgraded PDD Holdings Inc. (NASDAQ:PDD) to Buy from Neutral and raised its price target to $121 from $118, citing an improving earnings outlook. The firm said it expects PDD to continue gaining market share both in China and internationally over the long term.

On the same day, Morgan Stanley’s Eddy Wang placed PDD on Research Tactical Idea, reflecting a view that the stock could rise over the next 15 days. The call follows penalties imposed by China’s State Administration for Market Regulation on several e-commerce platforms, including PDD, tied to “Ghost Takeaway” cases. Morgan Stanley said the outcome removes a regulatory overhang that had been in place since late 2025, and believes the development could be seen as incrementally positive for the stock. The firm maintains an Overweight rating and a $148 price target.

Last month, PDD reported Q4 non-GAAP EPS of RMB17.69, down from RMB20.15 a year earlier, on revenue of RMB123.91B, up from RMB110.61B. Management highlighted its continued focus on high-quality growth and signaled increased investment in supply chain capabilities as a key priority heading into the next phase of expansion.

PDD Holdings Inc. (NASDAQ:PDD) operates e-commerce platforms including Temu, offering a wide range of consumer products globally.

While we acknowledge the potential of PDD to grow, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than PDD and that has 100x upside potential, check out our report about the cheapest AI stock.

READ NEXT: 10 Best Stocks That Beat Earnings Estimates and  10 Best 52-Week Low NASDAQ Stocks to Buy Now.

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