Analysts Raise PDD Price Target After Its Impressive Earnings

While Temu's rapid expansion in the US has been widely publicized, many investors are unaware that it has also been quietly expanding across Southeast Asia. Unlike TikTok, Temu has maintained a low profile, which has helped it avoid being caught up in geopolitical tensions and data security issues. This approach has allowed it to build its international user base efficiently and drama-free, making its subtle expansion into new markets a smart strategy.

However, PDD's lack of transparency in disclosing financials and operating metrics is a risk for investors. The company has been expanding aggressively overseas with Temu, which operates differently from its domestic platform. Additionally, PDD's Duoduo grocery arm has a lower margin model to attract customers. With PDD managing various businesses, more detailed reporting is necessary for investors to properly evaluate each segment. PDD may also be viewed as not shareholder-friendly since it has yet to authorize a share buyback program. Nevertheless, due to their exploding revenues, PDD is better suited to reinvest the excess cash to fuel more expansion.