Bernstein Lowers PDD Holdings (PDD) PT After Q1 Results, Keeps Outperform Rating

PDD Holdings Inc. (NASDAQ:PDD) is one of the 11 Best Foreign Stocks to Buy According to Hedge Funds. On May 28, Bernstein analysts, led by Robin Zhu, lowered their price target for PDD Holdings Inc. (NASDAQ:PDD) from $160 to $125 but kept an “Outperform” rating.

This decision came after the company’s first-quarter results, which fell short of both Bernstein’s and the wider market’s expectations, especially in revenue and profits.

The main reason for this shortfall was lower Gross Merchandise Volume (GMV) from Temu, PDD Holdings Inc.’s (NASDAQ:PDD) overseas e-commerce platform.

Bernstein’s analysis, which is based on discussions with cross-border merchants, indicates that Temu’s GMV was between $13-15 billion for the first quarter. This is an increase from about $10 billion in the same quarter last year. Despite this growth, it still failed to meet market expectations.

The operating profit was also below forecasts because of the revenue miss and higher spending on sales and marketing. PDD Holdings Inc.’s (NASDAQ:PDD) gross margin stayed relatively stable compared to Q4 2024. Bernstein analysts believe that this suggests that the sales mix of semi-consignment sales on Temu did not change much.

PDD Holdings Inc. (NASDAQ:PDD), previously Pinduoduo Inc., is a multinational commerce group that owns a portfolio of businesses, including e-commerce platforms Pinduoduo and Temu.

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Disclosure: None. This article is originally published at Insider Monkey.