Bernstein struggles to see what could drive JD.com turnaround

Bernstein analysts downgraded shares of JD.com (NASDAQ:) to Market Perform from Outperform, lowering the price target to $31 from $55 per share in a note to clients.

The re-rating is the third in the last few trading days after Morgan Stanley and Macquarie downgraded the stock last week. JD shares are down over 3% so far on Tuesday, after a more than 54% decline so far this year.

The analysts told investors in their note that their firm struggles to think the company can outgrow the likes of PDD and Douyin.

“JD’s shares have been on a downward trajectory for most of this year and fell sharply after the company signaled a much weaker trajectory for the remainder of 2023 than the street had expected,” explained the analysts.

They noted that JD’s struggles aren’t a secret to anyone, and the shares price in limited growth going forward.

“Category headwinds and weak macro have contributed to things going wrong,” the analysts added. “But we struggle to envision what might drive a turnaround. When we asked JD to articulate a turnaround strategy in the next 12 months, the response fell into platitudes and clichés…like getting better at execution.”