JDJD.com, Inc.
Is the business good?
A genuinely good business: earnings fully cash-backed (7.5×) and margins widening.
Operating profit is fully backed by cash. Conversion is improving vs a year ago.
Operating profit is falling even as sales grow, costs are outrunning the top line.
Efficiency-driven, thin margins turned over fast (the retail model). ROE 10% = margin × turnover × leverage.
Unless marked, from derived.
Where this answer is blind. The F-score rewards improvement, so an already-elite company can score mid-pack.
How good a business is JD?
JD.com, Inc. earns 3.6% on the capital it employs against a 9.0% cost of capital, so growth costs more than it returns.
Return on invested capital · cost of capital 9.0% · 5.4 points below what the capital costs: growth destroys value
- Operating margin
- 0.21%
Operating margin · Internet Retail median 6.0% · fiscal year to FY2025
- Cash conversion
- 7.49×
Cash conversion · 1.73× a year ago · operating cash flow covers the operating profit after tax
- Share count, year on year
- −3.2%
Share count, year on year · bought back, each share owns more of the company
| Year | Operating margin |
|---|---|
| FY2020 | 1.7% |
| FY2021 | 0.44% |
| FY2022 | 1.9% |
| FY2023 | 2.4% |
| FY2024 | 3.3% |
| FY2025 | 0.21% |
Details›
- Gross marginfiscal year to FY2025
- 16%
- Operating marginfiscal year to FY2025
- 0.21%
- Net marginfiscal year to FY2025
- 1.8%
- Free cash flow margin
- 0.85%
- R&D as % of revenue
- 1.7%
- Revenue, trailing twelve months
- $1.31T
- Free cash flow, trailing twelve months
- $11.2B
- Net income, trailing twelve months
- $23.1B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 3.6%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion is operating cash flow over operating profit after tax.
Internet Retail
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