Benchmark Reiterates Buy Rating on JD.com, Adjusts Q2 Revenue Growth Projection

Benchmark analysts reaffirmed their Buy rating and set a $55 price target on JD.com (NASDAQ:JD) stock. The analysts noted that JD's Q2/24 Gross Merchandise Volume (GMV) growth is expected to trail behind the broader e-commerce industry, primarily due to weaker performance in the electronics and home appliances sectors, which face tough year-over-year comparisons. Consequently, the revenue growth projection for Q2 has been adjusted down from 6% year-over-year to 1%.

On a positive note, Benchmark highlighted JD's adoption of more rational promotional strategies, which could enhance profitability. This led to an increased adjusted Net Income Margin (NIM) projection of 3.4%, up from the previous 2.9%. Despite the potential for sluggish growth in Q2, the analysts remain optimistic about the second half of 2024, citing a healthy growth trend in active buyers and purchase frequency, alongside a continued recovery in the General Merchandise category.