JD.com (NASDAQ:JD) is trending on social media and financial news websites, while JD stock is rallying over 15% today. The shares are jumping after the Chinese e-commerce firm delivered better-than-expected fourth-quarter results and announced a $3 billion stock buyback program.
JD’s Q4 Results and Stock Buyback Program
JD’s Q4 earnings per share last quarter, excluding certain items, came in at 75 cents or 5.3 Chinese yuan, up from 4.81 Chinese yuan during the same period a year earlier. Analysts, on average, had expected the firm to generate Q4 adjusted EPS of 63 cents. On the top line, the e-commerce giant’s revenue climbed 3.6% year-over-year to $43 billion. Analysts’ mean estimate for the firm’s sales was $41.5 billion.
According to Bloomberg, JD’s results were boosted by its varied offerings and price reductions. But the firm’s better-than-expected earnings could suggest that China’s economy is in meaningfully better shape than many China bears believe.
Meanwhile, JD announced that it would buy back $3 billion of its shares while instituting an annual dividend of 76 cents per share. That equates to a dividend yield of about 2.6%.
More About JD.com and JD Stock
Altering its traditional focus on relatively expensive, large products, JD has, in recent months, been selling cheaper fare while looking to offer more sales.
The firm adopted the strategy in an effort to boost its revenue growth. The firm’s top-line increases have been stunted by tough competition from a number of its up-and-coming rivals, including PDD (NASDAQ:PDD) and Douyin, which ByteDance owns. The latter company also controls TikTok.
Heading into today, JD had dropped 7% in the last month, and it had retreated 20% in the previous three months while tumbling 54% in the last year.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
