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JD.com (JD) to Report Q4 Earnings: What's in the Offing?

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JD.com, Inc.’s (JD - Free Report) fourth-quarter 2020 results are expected to reflect strength across the JD Retail, JD Health and New Business segments. In the last reported quarter, it delivered an earnings surprise of 16.3%.

The stock outperformed earnings estimates in each of the trailing three quarters, with the average being 19.6%.

Fourth-Quarter Estimates

For the fourth quarter, the Zacks Consensus Estimate for revenues is pegged at $33.1 billion, indicating an improvement of 34.8% from the year-ago reported figure.

Moreover, the consensus mark for earnings is pegged at 22 cents per share, suggesting a 175% rise from the prior-year reported number.

JD.com, Inc. Price and EPS Surprise

JD.com, Inc. Price and EPS Surprise

JD.com, Inc. price-eps-surprise | JD.com, Inc. Quote

Factors to Note

The company’s JD Retail segment comprising the e-commerce business is expected to have remained a key catalyst in the fourth quarter, courtesy of strengthening momentum across lower-tier cities.

Moreover, the online retail market boom is expected to have aided the JD Retail segment’s performance in the quarter to be reported.

Also, growing traction across the supermarket category — especially FMCG and fresh produce — is likely to contribute to its fourth-quarter results.

Additionally, JD.com’s strong efforts in offering services at the best price on the back of its scale and lower procurement costs from suppliers are expected to have benefited its fourth-quarter performance.

Further, strengthening of the company’s omnichannel offerings is expected to get reflected in JD Retail’s revenue performance.

Moreover, the company’s intensified focus on ensuring timely supply of products and fulfillment of customer demand might significantly aid the quarterly results.

Additionally, the strong New Businesses segment — which comprises logistics services, technology services and overseas businesses — might have driven fourth-quarter revenues.

However, mounting investment costs are likely to have weighed on its fourth-quarter performance. Moreover, severe competitive pressure in the e-commerce market from Alibaba (BABA - Free Report) might have been a headwind.

What Our Model Says

Our proven model does not conclusively predict an earnings beat for JD.com this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

JD.com has an Earnings ESP of 0.00% and a Zacks Rank #2, currently.

Stocks to Consider

Here are some stocks worth keeping tabs on, as our model shows that these have the right combination of elements to deliver an earnings beat in the upcoming releases.

TopBuild Corp. (BLD - Free Report) has an Earnings ESP of +6.66% and carries a Zacks Rank #2, at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Vipshop Holdings Limited (VIPS - Free Report) has an Earnings ESP of +6.25% and carries a Zacks Rank #3, currently.

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