Capping a good week on the stock exchange, JD.com (JD 0.07%) saw the price of its U.S.-listed American Depositary Receipts (ADRs) rise by nearly 9% on Friday. The big Chinese online retailer was still in the glow of a fine second quarter, the results of which were unveiled Thursday morning. A recommendation upgrade helped give the stock some real lift on the last trading day of the week.
A boost from a big U.S. bank
Ever-influential bank JPMorgan Chase was the entity behind the JD upgrade. Before market open, its analyst Andre Chang retagged it as an overweight (read: buy), one peg up from the previous neutral. Chang also cranked his price target higher -- it's now $36 per share, from the former $33.
The upgrade comes from a close read of those quarterly results, which, among other positive developments, revealed a net income figure that nearly doubled year over year.
In his latest research note on JD, Chang was cheered by the fact that "management has changed its strategy to focus on its strength rather than pursuing low prices at all cost." This emphasis on higher margins inspired the analyst to raise his forecasts for annual non-GAAP (generally accepted accounting principles) adjusted net income in both 2024 and 2025. The two estimates now sit at nearly 30% above the consensus prognosticator view, as published in Bloomberg, Chang added.
NASDAQ: JD
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Other pundits weren't so positive
JPMorgan Chase's upgrade was one of several adjustments made by analysts tracking JD.com stock. Interestingly, although the second quarter was clearly a strong one for the company, not all those adjustments were positive. Analysts at Benchmark and Bernstein SocGen Group both cut their price targets on the company's shares. The latter's Robin Zhu wrote that JD.com more or less performed to its expectations, which included a "small beat" on core profitability and reduced expectations for revenue growth.
