Goldman Sachs: Raises JD Health's target price to HK$42.5, adjusts revenue and profit forecasts upwards.

Goldman Sachs released a report stating that JD Health's first-quarter revenue and profit exceeded expectations, mainly driven by strong momentum in pharmaceuticals and nutritional products as well as an expansion in gross profit margin. The firm reiterated its confidence in JD Health's leading position, based on the company's strong supply chain capabilities in the online healthcare industry and brand recognition among users. Management considers the investment in the second half of the year to be significant and therefore maintains a relatively conservative guidance for this year, with double-digit revenue growth and operational profit remaining basically flat year-on-year. However, Goldman Sachs' forecasts are higher than market consensus and company guidance, based on their belief that JD Health will expand market share in the pharmaceutical category and benefit from increased traffic due to real-time demand. Goldman Sachs raised its revenue forecast for JD Health for this year to 2027 by an average of 2%, reflecting stronger-than-expected sales performance supported primarily by pharmaceuticals and nutritional products, and increased its net profit forecast for the same period by 1% to 3%. The firm raised its target price for the stock from 37.8 Hong Kong dollars to 42.5 Hong Kong dollars and maintained a "buy" rating.