Chinese stocks are back in the headlines, and we’re putting them on trial.
In this podcast, Motley Fool analyst Emily Flippen and contributors Jason Hall and Toby Bordelon:
- Go head-to-head on PDD Holdings.
- Debate whether Baidu can self-drive its future.
- Do a speed round between Weibo and iQiYi: deep value or value traps?
To catch full episodes of all The Motley Fool’s free podcasts, check out our podcast center. When you’re ready to invest, check out this top 10 list of stocks to buy.
This podcast was recorded on Nov.18, 2025.
Emily Flippen: We’re flipping the script today on Motley Fool Money as we put our bullhorns on and sharpen our bear claws to dig into Chinese stock earnings. It’s Tuesday, November 18th. Welcome to Motley Fool Money. I’m your usual host, Emily Flippen. But today we’re putting Fool contributor Jason Hall in the big chair so that you, Jason, can help facilitate a fun debate today between myself and Fool analyst Toby Bordelon.
Jason Hall: Emily, I’m never short on opinions. We know that, but on Motley Fool Money is a good idea to align those opinions with expertise. This morning we have earnings from four of the largest Chinese companies, and I know that you lived in China for four years. You have plenty of bullish thoughts that can be backed up with actual knowledge and expertise. We thought it would be fun to match you up with our notorious Chinese stock skeptic Toby Bordelon to have a bit of a fast paced bull-bear debate. We’ll get to iQiyi, Weibo, and Baidu later. But first, let’s start with a stock that you actually own in your portfolio. That’s PDD Holdings. Ticker symbol is PDD, formerly known as Pinduoduo. It’s an e-commerce powerhouse. Sears down today after what seemed like a pretty solid quarter. Emily, is this a buying opportunity?
Emily Flippen: I actually do think it’s buying opportunity, Jason. Now, to your point, I do own this in my personal portfolio, so I’m arguably a little biased here, 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 flows through to the bottom line with this business. PDD on both the Pinduoduo marketplace in China as well as its Temu marketplace that serves a global audience doesn’t generally own the inventory that it lists. It’s just the payment infrastructure and logistics platform, and 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.
Jason Hall: Emily, I feel your energy here. But, Toby, I have a feeling you may be a little bit less glass half full than Emily is.
Toby Bordelon: Yeah, look, I got to be honest here. I’m not sure I would call 9% growth solid for a company like this. It’s an e-commerce platform in a theoretically fast growing Chinese consumer economy, 9% ain’t going to cut it because it’s not meeting investor expectations here. If they can’t get the growth rates up, I think the valuation multiples they’re going to come down fast. My other problem here is the heavy spending they’re doing. Management even went so far as to warn that profits are going to fluctuate due to things like higher marketing costs, merchant subsidies, investment in the platform. It’s looking like a lot of what they expect this growth to be is going to be a lot more expensive going forward, and it signals the platform may not be very sticky for consumers.
Emily Flippen: My gosh, Toby, you think the valuation multiples are going to come down? This business has a market cap of somewhere like $180 billion. Nearly $60 billion of that is in cash. It has an enterprise value to EBITDA of less than 10 times while growing its bottom line earnings per share double digits. Even if the top line is only growing 9%, that’s downright cheap. That’s too cheap to ignore.
Toby Bordelon: Now, look, it’s only cheap with the assumption that you’re going to get a rebound on those growth rates. If we are in a permanent growth decline, the market is going to reset to a lower valuation at some point. From a platform and business investment standpoint, this could be a money pit, not a growth opportunity. The bigger picture, Emily, I think, is we don’t know what’s driving these results. What’s the Temu contribution versus PDD? Who knows? What’s the platform gross market value? No idea. Gross market volume? No idea there. What’s the retention rate, the take rate? There’s no disclosure with these things. Chinese companies, let’s put it this way, they historically do not have the best reputation in terms of keeping all the numbers on the up and up. A refusal to share details on these things, doesn’t give me a lot of confidence in what’s really going on here.
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