Pinduoduo Inc. (NASDAQ: PDD) has confirmed that it will release its unaudited Q3 2021 earnings results for the period ending September 30, 2021, on Friday, November 26, 2021, before markets open.
What to look for
The company operates through subsidiaries and runs an eCommerce platform in China. The company's loss has lessened since it reported a full financial year loss of CN¥7.2 billion to the most recent loss for trailing 12-months of CN¥2.7 billion, and it is about to break even. Analysts anticipate the company to report its final loss this year and generate a profit of CN¥2.6 billion next year.
Earnings: Stockearning’s Estimated EPS for the third quarter is $0.02. In the second quarter, the company reported earnings of $2.85 per share, topping estimates of $0.22. Historical EPS performance shows that the company has, in the past 12 quarters, beat estimates seven times (58%) and missed four times (33%).
Revenue: the company expects its Q3 2021 revenue to grow from the previous quarter. In the second quarter, the company reported revenue of $23.05 billion, missing average consensus estimates of $26.53 billion, but the revenue was up 89% YoY.
Stock Movement: Since the last earnings release, PDD stock has gained 1%. PDD stock has been DOWN 7 times out of the past 13 quarters after the earnings release. So, the historical price reaction suggests a 53% probability of the share price going DOWN once PDD releases its earnings. According to the Stockearning algorithm, the predicted first-day move is 13%, while the predicted move on the seventh day is 11%.
What analysts are saying
Barclays analysts Jiong Shao commenced coverage on the stock with "Hold" and a price target of $103. Shao initiated coverage on the tech sector with a positive sentiment stating investors "cannot ignore or not invest" in China, considering it is the second-largest economy globally. The analyst said in a research note that Beijing is looking to strengthen its homegrown tech and internet firms and not weaken them. Shao said that with an overall take rate of at least 3%, the company would be challenged to implement future monetization improvements.
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