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PDD Holdings has the Financial Strength Rank of 10. It shows strong financial strength and is unlikely to fall into distressed situations.
Good Sign:
PDD Holdings Inc shows strong financial strength.
GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is rated on a scale of 1 to 10 and is based on these factors:
1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.
4. Other debt related ratios.
A higher score indicates a stronger financial position, with companies rated 7 or above considered financially stable and unlikely to face distress. Conversely, a score of 3 or below suggests potential financial difficulties, indicating a higher risk of distress.
PDD Holdings's Interest Coverage for the quarter that ended in Mar. 2026 was 30.96.
PDD Holdings's debt to revenue ratio for the quarter that ended in Mar. 2026 was 0.01.
As of today, PDD Holdings's Altman Z-Score is 5.01.
The rank is rated on a scale of 1 to 10. A higher score indicates a stronger financial position, with companies rated 7 or above considered financially stable and unlikely to face distress. Conversely, a score of 3 or below suggests potential financial difficulties, indicating a higher risk of distress.
PDD Holdings has the Financial Strength Rank of 10. It shows strong financial strength and is unlikely to fall into distressed situations.
PDD Holdings Financial Strength Related Terms
PDD vs MELI, DASH, SE: Financial Strength Comparison
For the Internet Retail subindustry, PDD Holdings's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
PDD Holdings Financial Strength vs Retail - Cyclical Industry
For the Retail - Cyclical industry and Consumer Cyclical sector, PDD Holdings's Financial Strength distribution charts can be found below:
* The bar in red indicates where PDD Holdings's Financial Strength falls into.
Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:
The higher the ratio, the stronger the company's financial strength is.
Good Sign:
Ben Graham prefers companies' interest coverage to be at least 5. PDD Holdings Inc has enough cash to cover all of its debt. Its financial situation is stable.
2. Debt to revenue ratio. The lower, the better.
PDD Holdings's Debt to Revenue Ratio for the quarter that ended in Mar. 2026 is
Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.
The zones of discrimination were as such:
When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.
PDD Holdings has a Z-score of 5.01, indicating it is in Safe Zones. This implies the Z-Score is strong.
Good Sign:
Altman Z-score of 5.01 is strong.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
PDD Holdings (PDD) has a Financial Strength of 10 as of Mar. 2026. The financial strength rank measures the strength of a company's balance sheet based on revenue and debt. View historical data on PDD Holdings and its competitors. This is 25% above median its historical median of 8.00. Over the past decade, PDD Holdings' Financial Strength has ranged from 6.00 to 10.00.
Is PDD Holdings' Financial Strength too high?
PDD Holdings' current Financial Strength of 10 is 25% above median its 10-year median of 8.00. Over the past 10 years, this metric has ranged from a low of 6.00 to a high of 10.00. Overall, PDD Holdings has a GF Score™ of 73/100 and is considered Significantly Undervalued, reflecting its overall financial health beyond just this single metric.
How does PDD Holdings' Financial Strength compare to MELI and DASH?
PDD Holdings' Financial Strength of 10 can be compared against companies in the Retail - Cyclical industry. Historically, PDD Holdings' own Financial Strength has ranged from 6.00 to 10.00 over the past decade. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Financial Strength for a Retail - Cyclical company?
A good Financial Strength depends on the Retail - Cyclical industry context. However, Financial Strength should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Financial Strength mean?
A high Financial Strength can signal that a stock is expensive relative to its fundamentals. The financial strength rank measures the strength of a company's balance sheet based on revenue and debt. View historical data on PDD Holdings and its competitors. PDD Holdings's current Financial Strength is 10, which is 25% above median its own 10-year median of 8.00. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is PDD Holdings stock overvalued right now?
Based on GuruFocus' analysis, PDD Holdings (PDD) is currently considered Significantly Undervalued. The stock's GF Value™ is $156.64, compared to a current price of $91.03 — trading 41.9% below its estimated fair value. The current Financial Strength is 10, which is 25% above median its 10-year median of 8.00. PDD Holdings' overall GF Score™ is 73/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Financial Strength calculated?
Financial Strength is calculated from a company's financial statements. For PDD Holdings (PDD), the current Financial Strength is 10 as of Mar. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is PDD Holdings (PDD) Overvalued in 2026?
Based on GuruFocus' analysis, PDD Holdings stock appears to be undervalued.
The current stock price of $91.03 is trading 41.9% below its estimated GF Value™ of $156.64.
GuruFocus considers PDD Holdings to be Significantly Undervalued.
Key valuation signals for PDD:
Financial Strength: 10 (25% above median its 10-year median of 8.00)
GF Value™: $156.64 vs. price of $91.03 (41.9% below fair value)
No single metric tells the full story. See the PDD stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
PDD Holdings operates commerce businesses globally. Its main operations are Pinduoduo, a social commerce platform in China, and Temu, a global e-commerce marketplace. PDD also has a community group purchase business in China. PDD has built a network of sourcing, logistics, and fulfillment capabilities that support its underlying businesses. PDD has also started its first-party brand business for global markets.
73GF Score
Get the complete analysis for PDD
Financial Strength is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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