Billionaire David Tepper’s Top 10 Stock Picks Heading into 2025

7. JD.com, Inc. (NASDAQ:JD)

Appaloosa Management LP’s Stake Value: $292 Million

Number of Hedge Fund Holders: 75

JD.com, Inc. (NASDAQ:JD) is a Chinese internet retail giant that offers computers, communication, and electronic products. It operates as a supply chain-based technology and service provider. The stock is up by over 37%, outperforming the S&P 500, that’s up by about 26%. The outperformance comes from the e-commerce giant successfully navigating a challenging market environment amid a slowing Chinese economy.

With the help of its strong logistics network and reputation for genuine goods, JD.com, Inc. (NASDAQ:JD) has become a major player in China’s e-commerce market. The company’s direct sales strategy gives it more control over its inventory and clientele. Likewise, it delivered better-than-expected third-quarter results on November 14, 2024, despite fierce competition from Alibaba and PDD holdings.

Its net profit was up 48% year-over-year to $1.62 billion, which was helped by a 5.1% increase in revenue to $260.39 billion. Retail sales, which account for the most significant share of the company’s revenue, were up 6.1% as logistics sales increased 7.9%. Strong performance in specific product categories demonstrates JD.com, Inc. (NASDAQ:JD)’s competitive differentiation in the Chinese e-commerce market. The appliance segment’s robust sales have primarily driven the company’s strong third-quarter projections for 2024.

The company’s ability to effectively navigate China’s declining consumption has further strengthened its position in the market. Over two years, JD.com, Inc. (NASDAQ:JD) has increased its net margin from 2.0% to 3.6%, exhibiting sound management and operational fortitude in the face of economic challenges.

Ariel Investments stated the following regarding JD.com, Inc. (NASDAQ:JD) in its Q3 2024 investor letter:

“China-based E-commerce company, JD.com, Inc. (NASDAQ:JD) was the top contributor in the quarter as the People’s Bank of China’s (PBOC) comprehensive stimulus measures bolstered investor confidence in the Chinese economy. The improving economic sentiment is fueling consumer spending which benefits the company’s retail operations. Additionally, the company’s strategic decision to diversify general merchandise product offerings, expand its third-party marketplace business and monetize advertising streams has contributed to consecutive quarterly earnings beats. JD.com is also poised to capitalize on the home appliance trade-in program, which is one of its largest product categories. Given the favorable market environment, the company’s strategic positioning and supply chain efficiency improvements, we continue to like its long-term growth prospects.”