Macquarie Downgrades Pinduoduo Inc. (PDD) to Neutral

Macquarie analyst Ellie Jiang downgraded Pinduoduo Inc. (NASDAQ: PDD) from Outperform to Neutral with a price target of $87.00 (from $151.00).

The analyst comments: “PDD's 1Q26 revenue increased 11% to Rmb106bn, but adjusted NP fell 17% YoY, with a notably significant investment loss of Rmb2bn during the quarter. While PDD now trades at a distressed 8.8x FY26E P/E multiple (vs 10x-12x for industry peers), we struggle to find tangible evidence to support a sustainable near-term earnings recovery, considering lacklustre consumption, aggressive ecommerce competition, and a continued need to invest for supply chains and overseas expansion.

Compared to other EC peers, PDD's profitability was dragged by additional subsidies to match trade-in policy in the year prior. Yet, online marketing services (OMS) remained sluggish as revenue growth decelerated further to 2% YoY in 1Q26, from 5% in 4Q25, implying continued take rate contraction and less favourable market share dynamics.

Sales & marketing spend for 1Q26 increased to 32% of total revenue, vs 29% in 2025, indicating an investment uptick at both domestic and overseas markets. Moreover, the previously-announced new 1P product brand "New Pinmu" was officially launched, further consolidating its supply chain capabilities, with management expecting to spend >Rmb100bn in the next three years to build another PDD.”

For an analyst ratings summary and ratings history on Pinduoduo Inc. click here. For more ratings news on Pinduoduo Inc. click here.

Shares of Pinduoduo Inc. closed at $86.61 yesterday.

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