Chinese e-commerce company JD.com (NASDAQ:JD) reportedly plans to create a new retail unit dedicated to fresh food and groceries. The unit is expected to be formed through the merger of the company’s 7Fresh supermarket chain, group-buying e-commerce platform Songshu Pinpin, and other online services.
Pick the best stocks and maximize your portfolio:
- Discover top-rated stocks from highly ranked analysts with Analyst Top Stocks!
- Easily identify outperforming stocks and invest smarter with Top Smart Score Stocks
Alongside the establishment of physical stores, the new retail division will explore innovative approaches to the retail industry. Additionally, Yan Xiaobing, the former head of JD.com International, will assume the role of overseeing the new unit starting Monday.
This move signifies JD’s intention to expand its presence in the grocery market and meet the increasing demand for goods and household products.
Importantly, the new business unit of JD.com will share similarities with Alibaba Group’s (BABA) Freshippo unit, a premium physical grocery store. It is worth mentioning that Alibaba is currently raising funds and making preparations for an independent listing of Freshippo. BABA is expected to seek approval from the Hong Kong exchange in the near future to initiate the spin-off of the unit.
The announcement of JD.com’s new retail unit aligns with the company’s recently unveiled, ambitious 20-year plan. As part of this plan, JD.com aims to establish seven enterprises, each with a valuation exceeding 100 billion yuan ($13.83 billion). This strategic initiative demonstrates JD.com’s proactive approach to long-term growth and its commitment to expanding its business and market presence in various sectors.
Is JD Stock a Buy, Sell, or Hold?
Currently, analysts have a Strong Buy consensus rating on JD stock. This is based on 11 Buy and three Hold recommendations. The average price target of $59.50 implies 70.63% upside potential from the current level. The stock is down about 39% so far in 2023.
As per TipRanks data, the most accurate and profitable analyst for JD.com is Nomura analyst Jialong Shi. Copying the analyst’s trades on this stock and holding each position for one year could result in 52% of your transactions generating a profit, with an average return of 20.88% per trade.
