On Thursday, Pinduoduo Inc. (NASDAQ:PDD) saw its price target increased by Benchmark to $220 from $215, while the firm maintained a Buy rating on the stock. The adjustment follows Pinduoduo's recent financial results, which showcased a significant year-over-year doubling of both revenue and profit.
The company's impressive performance was driven by substantial growth in its domestic markets, which saw a 57% increase year-over-year, and its international platform, Temu. As a platform recognized for its value for money, Pinduoduo is expected to continue capturing more of the domestic market share. Benchmark has subsequently increased its forecast for Pinduoduo's domestic revenue growth for fiscal year 2024 to 25% year-over-year, up from the previous estimate of 20%.
Internationally, the company's growth trajectory is also on the rise. Pinduoduo's expansion into new markets and the growing adoption of its hybrid model have led Benchmark to revise its Gross Merchandise Volume (GMV) projection for Temu for fiscal year 2024. The new estimate predicts a 120% year-over-year increase, a significant jump from the prior estimate of 71%.
The raised price target to $220 reflects Benchmark's updated estimates, which account for Pinduoduo's continued expansion and market penetration.
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