The management of the Chinese e-commerce company JD.Com Inc (ADR) (NASDAQ:JD) have announced a share buyback program amid the recent slump of the country’s stock market. The company has announced that up to $1 billion worth of American Depositary Shares (ADS) will be bought over the next two years, using cash available to perform this operation. Chase Coleman‘s Tiger Global Management is very bullish on this stock, which is also their largest equity holding.
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One of Alibaba Group Holding Ltd (NYSE:BABA)’s main competitors, JD.Com Inc (ADR) (NASDAQ:JD) has seen its stock plunge by roughly 30% during the month of August, as worries about China’s economy have tipped stock markets into turmoil. The slump has prompted a host of Chinese companies, Alibaba among them, to announce share buyback programs in a bid to revitalize their respective stock performances. Today’s news has invigorated JD.Com Inc (ADR) (NASDAQ:JD), with shares advancing by as much as 13% during the first 30 minutes of trading.
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As mentioned earlier, Tiger Global Management believes JD.Com Inc (ADR) (NASDAQ:JD) has great upside potential, having increased its stake in the company by 236% during the second quarter. According to the investor’s latest 13F filing, it holds approximately 70.2 million shares with a value just shy of $2.40 billion. Billionaire Stephen Mandel is also betting big on this company, with his fund, Lone Pine Capital, reporting a position that amasses 41.9 million shares worth some $1.42 billion. Robert Pitts, the manager of Steadfast Capital Management, also has JD.Com Inc (ADR) (NASDAQ:JD) in his equity portfolio and has increased his holding during the second quarter to 6.06 million shares valued at $206 million.
Despite the fact that its second quarter revenues grew by a staggering 60.6% to CNY 45.93 billion ($7.22 billion) compared to the same period last year, JD.Com Inc (ADR) (NASDAQ:JD)’s stock has been severely affected by the slowdown of the Chinese economy. It peaked on June 12 at $38 per share before erasing all the gains for the year and dipping into red at the end of August. Since then, the stock has been consolidating around the $25 level, giving the company a market cap of roughly $31.3 billion. Recently, JD.Com Inc (ADR) (NASDAQ:JD) has announced a partnership with Lotte.com, one of the largest online commerce sites in South Korea. According to the agreement between the two companies, JD.Com customers will be able to purchase a wide range of products sold by Lotte.com via JD Worldwide, the company’s cross-border platform.
“The demand for products through Korean Mall has been strong and partnering with Lotte, Korea’s clear industry leader, will help us meet the growing needs of our users. We are delighted that as China’s largest e-tailer, our large and growing base of upwardly mobile customers will now have access to a wide range of Lotte’s imported products,” said JD Mall Chief Executive Officer Haoyu Shen.
Disclosure: none.
