JD.com-SW (09618.HK)(JD.US) reported its third quarter results after the market closed yesterday (14th), with net profit rising 48% year-on-year to 11.731 billion yuan, exceeding the upper limit of 9.979 billion yuan predicted by a composite of four brokerages, with EPS of 4.02 yuan; the US Depository Receipts earnings were 8.05 yuan. Non-GAAP net profit increased by 24% year-on-year to 13.174 billion yuan, also higher than the upper limit of 12.062 billion yuan predicted by a composite of 15 brokerages. Non-GAAP EPS was 4.52 yuan; US Depository Receipts earnings were 9.04 yuan. Total revenue for the period rose 5% year-on-year to 260.387 billion yuan.

The company stated that in the third quarter, the group's electronic products and home appliances category saw a return to growth, and the daily necessities category continued to be strong. With ongoing improvements in supply chain capabilities, enhancing scale effects and operational efficiency, the group's gross margin and non-GAAP net profit margin both achieved healthy growth in the third quarter. During the period, the company completed the share buyback plan announced in March this year and initiated a new share buyback plan of 5 billion USD, effective until the end of August 2027. Nomura reported that JD.com expects comprehensive revenue for the fourth quarter to increase by 5.7% year-on-year, roughly similar to the third quarter, with non-GAAP net profit maintaining stable year-on-year at around 8.4 billion yuan.

[Daiwa indicated there was no positive surprise in quarterly revenue]

Daiwa pointed out that even though JD.com's fourth quarter revenue and net profit guidance might disappoint some investors, there is potential upside observed, as the quarterly results will reflect the impact of the trade-in policy fully. The firm also mentioned that despite JD.com's non-GAAP net profit being 17% higher than market expectations, benefiting from JD Logistics (02618.HK) operating profit margin exceeding expectations and non-operating items, the total revenue and JD retail operating profit margin in the third quarter did not yield positive surprises. The firm raised its EPS forecast for JD.com for this year and next by 1% to 6%, reflecting the better-than-expected profitability of JD Logistics, and maintained a "buy" rating for the stock with a target price of 200 yuan.

HSBC Global Research stated that JD.com's third-quarter revenue met expectations, while slightly weaker service revenue offset somewhat higher JD retail revenue. The trade-in program drove stable growth in gross transaction volume for home appliances and electronic products, with gradual improvement in September and October. The firm noted that even though JD.com achieved favorable results under more aggressive promotions for "Double Eleven" and government subsidies, it maintains its performance forecasts for JD.com, looking for clearer trends in year-end demand; the firm also expects JD.com to increase sales and promotional spending in the fourth quarter and next year to drive growth, with the increase in operational spending being offset by continued improvement in gross margin, benefiting from optimized procurement, logistics business control, and increased contributions from third-party sales. The firm maintains a "buy" rating for JD.com with a target price of 207 yuan, and stated that the market anticipates double-digit revenue growth in the fourth quarter, so the stock price needs clearer revenue and profit outlooks for value reassessment in the short term.

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The latest comprehensive investment ratings and target prices from 11 brokerages on this website:

The table below lists the ratings and target prices from 8 brokerages for its shares listed in Hong Kong (09618.HK):

Brokerage | Investment Rating | Target Price

ubs group | buy | 250 yuan

macquarie | outperform | 232 yuan -> 217 yuan

credit suisse | buy | 210 yuan

hsbc global research | buy | 207 yuan

jpmorgan | shareholding | 200 yuan

daiwa | buy | 200 yuan

bofa securities | buy | 173 yuan -> 188 yuan

Goldman Sachs | Buy | 178 yuan

The table below lists the ratings and target prices from 11 brokerages for its American Depositary Receipts (JD.US):

Brokerage | Investment Rating | Target Price

UBS Group | Buy | 64 USD

Macquarie | 60 USD -> 57 USD

Friedman | Buy | 54 USD

HSBC Global Research | Buy | 53 USD

Nomura | Buy | 53 USD

Daiwa│buy│52 USD

Citi│buy│52 USD

jpmorgan│shareholding│50 USD

Bank of America Securities│buy│44 USD->48 USD

goldman sachs│buy│45 USD

morgan stanley│in line with the market│41 USD

Brokerage views

ubs group│Results benefited from a profit margin significantly exceeding expectations, business outlook is positive.

Macquarie │ Strong quarterly results

Credit Suisse │ Fourth quarter revenue growth expected to accelerate under improved sentiment

HSBC Global Research │ Growth boosted by old-for-new program

Nomura │ Quarterly earnings strengthened, fourth quarter guidance meets expectations

Daiwa │ Income rise driven by the old-for-new policy

JPMorgan │ Stable quarterly results bring positive stock price response

Bank of America Securities │ Fourth quarter revenue negatively impacted by subsidies throughout the quarter accelerating downward

Citi │ Quarterly net profit significantly beats expectations

Goldman Sachs │ Quarterly earnings beat expectations.

Morgan Stanley │ Benefiting from the upgrade program.