JD – Market expectations are for record-high Uniform ROA, but management has concerns about their investments, merchants, and profitability

• • • JD.com, Inc. (JD:USA)currently trades above corporate averages relative to UAFRS-based (Uniform) Earnings, with a 36.6x Uniform P/E, implying bullish expectations for the firm. However, management has concerns about their investments, merchants, and profitability
    • Specifically, management may lack confidence in their expectations for supply chain investments to lead to service revenue and margin upside in 2018, as well as expectations for their core business to generate increasing profitability going forward. Additionally, they may lack confidence in their ability to continue to provide merchants with more back-end solutions and advertising products that allow them to have better control over their promotional needs, and may be exaggerating their satisfaction with their Apparel segment merchant retention