We recently compiled a list of the 10 Chinese Penny Stocks to Buy According to Analysts. In this article, we are going to take a look at where Dingdong (Cayman) Limited (NYSE:DDL) stands against other Chinese penny stocks to buy according to analysts.
The announcement of the Chinese stimulus has somewhat created interest among investors and market pundits. China’s local market reacted positively after the government announced that it would apply a ‘moderately loose’ strategy for monetary policy in 2025. This will be China’s first major shift in economic policy since 2011. The Chinese government could take a more proactive approach to fiscal policy to stabilize property and stock markets.
READ ALSO: 10 Best Canadian Stocks to Buy Under $10 and 10 Most Profitable European Stocks To Invest In.
China’s President Vows to Meet Growth Target
China’s president, Xi Jinping, has assured that the country will remain the world’s ‘growth engine’ and meet its GDP growth target of 5% in 2024. The Chinese government has taken bold steps to support its economy. Moreover, the stimulus has come at a time when the economy is struggling badly and there are potential tariff threats from the new U.S. administration. Despite that, China has been facing lower imports and exports, which greatly threatens the economy against Trump’s tariffs.
The outbound shipments saw a 6.7% growth in November, missing estimates by 8.5% and down from a 12.7% growth in October 2024. On top of that, the imports declined 3.9% in November, the worst performance for imports in nine months, as reported by Reuters.
China’s stimulus of $1.5 trillion, or nearly 10 billion yuan, to support its economy has given some hope. Further loosening the policy would support small businesses. However, for investors to be attracted to the Chinese stock market, something positive needs to happen, especially how the economy reacts to the policy during the first half of 2025.
“The actual delivery has disappointed high hopes several times already over the past two years. We are back to the tricky stage of waiting for actual numbers to see whether it lives up to expectations,” said Xin-Yao Ng, investment director on the Asian equities team at abrdn.
The Hang Seng Index has plunged over 3% over the last five days, as of December 17, while the CSI 300 index has dropped by nearly 1.50% in the last five days but it is up by almost 16% year to date. We can see the market’s mixed reaction to the recent events.
You can also visit and see 12 Cheap Chinese Stocks to Buy According to Hedge Funds.
A close-up view of a farm’s green vegetables, ripening in the sun.
Our Methodology
To compile our list of the 10 Chinese penny stocks to buy according to analysts, we used a Finviz screener to list down all Chinese penny stocks under $5. We then picked the 10 stocks with the highest upside (over 25%) according to analysts, as of December 17. The list is ranked in ascending order of analysts’ estimated upside.
Why do we care about what hedge funds do? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 275% since May 2014, beating its benchmark by 150 percentage points (see more details here).
Dingdong (Cayman) Limited (NYSE:DDL)
Share Price (As of December 17): $3.96
Analysts Upside: 38.78%
Dingdong (Cayman) Limited (NYSE:DDL) is a Chinese e-commerce company that provides groceries and other daily necessities. The products offered on Dingdong’s e-commerce platform mainly include fresh eatable items such as farm items, meat, and seafood. The company has over 950 frontline fulfillment stations across China, supported by almost 40 regional processing centers to assist its supply chain.
Dingdong Limited (NYSE:DDL) has attracted strong demand from lower-tier cities within Jiangsu and Zhejiang. The growth in these regions is driven by accelerated penetration via new fulfillment stations and improved product offerings. The company has expanded its products with the addition of fruits, dairy, wine, snacks, and baked goods, leading to high daily transaction volumes.
In addition to that, the company opened 80 new frontline fulfillment stations in Q3 2024, which added to strong financial performance during the quarter. The enhanced inventory management and delivery speed have further improved the number for DDL. During Q3, the revenue soared by 27% year-over-year to RMB 6.54 billion while the gross merchandise value (GMV) increased by 28% to RMB 7.27 billion. The company continues to enhance its growth after it achieved non-GAAP profitability for the eighth consecutive quarter.
The continuous growth and profitability have helped Dingdong improve its cash position, achieving a positive net inflow for five consecutive quarters. With further development and inventory management, Dingdong (Cayman) Limited (NYSE:DDL) remains a promising Chinese penny stock to invest in.
Overall, DDL ranks 5th on our list of Chinese penny stocks to buy according to analysts. While we acknowledge the potential of DDL to grow, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than DDL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.
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Disclosure: None. This article is originally published at Insider Monkey.