Lates News

UBS released a report stating that Pinduoduo's performance in the second quarter should temporarily alleviate investors' concerns, including the overall financial impact of US tariffs on its Temu business, the potential impact on profit margins of the 100 billion yuan subsidy launched in April, and the legitimacy of Pinduoduo's cash balance as interest and investment income returns. The report suggests that Pinduoduo's competitors in mainland China are shifting their focus to rapid business growth rather than low-price competition, which should reduce the competitive pressure on Pinduoduo in the traditional e-commerce sector. The second quarter for Temu may be the most severely impacted by US policies, but it is expected to gradually recover due to the return of US traffic, ongoing testing of new cross-border e-commerce models, and continued expansion outside the US. The bank believes that the market has room to raise profit expectations for Pinduoduo after the earnings announcement. It has raised its earnings forecasts for Pinduoduo by 13% to 32% per share for the years 2021 to 2027, and increased the target price from $165 to $176, with a "Buy" rating.