JD LOGISTICS (02618) rose more than 3% in Hong Kong trading. As of the time of writing, the stock was up 2.64%, trading at HKD 13.99, with a turnover of HKD 83.87 million.

The increase follows the recent release of JD LOGISTICS's 2025 annual performance report. The company reported full-year total revenue of RMB 217.1 billion, representing a year-on-year increase of 18.8%. Its adjusted net profit reached RMB 7.71 billion, highlighting robust earnings growth.

Bank of America Securities noted that JD LOGISTICS's fourth-quarter 2025 performance exceeded expectations, driven by a decrease in operating expenses. Management has expressed an optimistic outlook for the 2026 fiscal year, guiding for revenue growth of 20% to 25% and non-IFRS net profit growth of 25% to 30%. Achieving these targets would imply a potential 15% to 20% upside to current profit forecasts, surpassing even the most optimistic investor assumptions by approximately 10% to 15%. This would equate to a forecasted 2026 price-to-earnings ratio of less than 7 times.

Morgan Stanley believes that while JD LOGISTICS is positioned for strong growth in 2026, partly due to a favorable base effect, the trajectory of its profit margins will be the primary factor driving its valuation. The firm projects that JD LOGISTICS's revenue will grow 22% year-on-year in 2026, surpassing the 19% growth achieved in 2025. It anticipates that the on-demand delivery business will become the main driver of this growth.

Morgan Stanley estimates that the on-demand delivery segment will contribute 13 percentage points of the annual growth, primarily benefiting from the integration of Dada Group's operations and a lower comparative base for the food delivery business in the first half of 2025. The firm also forecasts that JD LOGISTICS's net profit margin will increase from 3.6% in 2025 to 3.7% in 2026, with a further expansion to 3.8% expected in 2027.