Morgan Stanley Reaffirms Overweight on PDD Holdings (PDD), Sees Upside Ahead of Q1 Earnings

Morgan Stanley maintained its price target of $150 while reaffirming its Overweight rating on PDD Holdings Inc. (NASDAQ:PDD) on May 24. The firm believes that PDD’s share price could soar in response to the company’s upcoming first-quarter 2025 financial results.

Morgan Stanley Reaffirms Overweight on PDD, Sees Upside Ahead of Q1 Earnings

Morgan Stanley predicts that the company’s online marketing services revenue will increase by 11% in the first quarter compared to the same period last year, which is equivalent to an 18% increase in gross merchandise volume. This growth rate indicates that PDD Holdings Inc. (NASDAQ:PDD) is continuing to increase its market share, as it far exceeds the industry average of 6% year-over-year.

Additionally, the firm projects that PDD Holdings Inc. (NASDAQ:PDD)’s non-GAAP net profit for the Q1 will amount to RMB 28 billion, which would represent an 8% year-over-year decline. Although the firm blames PDD’s high earnings base from Q1 2024, alongside increased subsidies to consumers and merchants, it states that lower spending in the company’s US operations under the Temu brand may help offset some of the effects.

PDD Holdings Inc. (NASDAQ:PDD) is a multinational company that operates several businesses, including two significant ventures, Temu and Pinduoduo.

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