NEW YORK (TheStreet) -- JD.com (JD) - Get Report stock is climbing by 3.22% to $25.17 in late afternoon trading on Thursday, as the company opens a Hong Kong office and partners with COSCO Logistics to improve cross-border operations.
On Wednesday, Beijing-based JD.com officially opened its new Hong Kong office, which it hopes will improve engagement with brands and retailers in Hong Kong, Singapore and other Asian markets that want access to the company's 118 million mainland China users, according to a statement.
JD.com said it plans to create a team dedicated to attracting new retail partners from the region.
"We have seen rapid growth in demand from our customers for Asian brands and products, and from leading brands and retailers across the region who want to reach our huge base of upwardly mobile customers," chief human resources officer Rain Long said in a statement. "This new office will expand our ability to attract and service brands from around the region, and ultimately to ensure that we continue to bring our customers the most exciting and diverse selection of international products."
The company is also partnering with logistics provider COSCO Logistics to decrease shipping times from Hong Kong to mainland China by three to four days, per the statement.
JD.com is an online direct sales company.
Separately, TheStreet Ratings team rates JD.COM INC -ADR as a Hold with a ratings score of C-. TheStreet Ratings Team has this to say about their recommendation:
"We rate JD.COM INC -ADR (JD) a HOLD. The primary factors that have impacted our rating are mixed some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures and growth in earnings per share. However, as a counter to these strengths, we find that the company's profit margins have been poor overall."
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- JD's very impressive revenue growth exceeded the industry average of 33.9%. Since the same quarter one year prior, revenues leaped by 60.6%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
- JD's debt-to-equity ratio is very low at 0.04 and is currently below that of the industry average, implying that there has been very successful management of debt levels.
- Compared to other companies in the Internet & Catalog Retail industry and the overall market, JD.COM INC -ADR's return on equity significantly trails that of both the industry average and the S&P 500.
- After a year of stock price fluctuations, the net result is that JD's price has not changed very much. Although its weak earnings growth may have played a role in this flat result, don't lose sight of the fact that the performance of the overall market, as measured by the S&P 500 Index, was essentially similar. The fact that the stock is now selling for less than others in its industry in relation to its current earnings is not reason enough to justify a buy rating at this time.
- The gross profit margin for JD.COM INC -ADR is currently extremely low, coming in at 6.36%. Regardless of JD's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of -1.11% trails the industry average.
- You can view the full analysis from the report here: JD