Emily Flippen

But this was a solid quarter.

Revenue growth wasn't anything to write home about, but it was in line with what the company was expecting, given the fact that they are operating in a more competitive and admittedly tariff-ridden environment.

But the reason I like this company is because of its business model.

Virtually everything

everything flows through to the bottom line with this business.

PDD on both its Pinduoduo marketplace in China, as well as its Timu marketplace that serves the global audience, doesn't generally own the inventory that it lists.

It's just like the payment infrastructure and logistics platform.

On its Chinese side, a majority of the revenue comes from ad placements.

PDD Holdings was able to grow profits at nearly twice the rate of revenue in the quarter

Even with all of the craziness going on with issues of dropshipping and the removal of De Minimis in the United States, it has nearly 25% net income margins over the past year.

I'm so compelled by this opportunity.

Oh my gosh, Toby, you think the valuation multiples are going to come down?

I mean, okay, this business has a market cap of somewhere like $180 billion.

Nearly $60 billion of that is in cash.

So, it has an enterprise value to EBITDA of less than 10X while growing its bottom line earnings per share double digits.

I mean, even if the top line is only growing 9%, that's downright cheap.

That's too cheap to ignore.

Yeah, I think that's fair.

I never get the full color that I want from Chinese companies and can feel a little criminal about the fact that they don't even give reportable segments when it comes down to what sales come from Timu versus the Pendle Dwell marketplace.

We disagree, but still, I think the valuation is considerable for maybe more risk-tolerant investors.