PDD Holdings' 4Q earnings beat has soothed concerns among some investors regarding its profitability outlook, Deutsche Bank analyst Jessie Xu writes in a note.
The company's 24% revenue growth in 4Q was strong, especially given the fact that it wasn't as well-positioned as JD.com and Alibaba to benefit from the Chinese government's consumer trade-in program, Xu adds.
The analyst is less concerned about PDD's margin decline, and forecasts 25% revenue growth this year with CNY136 billion of net profit. The brokerage maintains a buy rating on the stock and raises its target price to $166.00 from $152.00. Shares last closed at $126.64.