PDD Holdings, or Pinduoduo (NASDAQ: PDD), the parent company of the renowned Chinese e-commerce platform Temu, saw a significant upswing last month.
Notably, the company’s stock witnessed a remarkable surge following the release of its Q2 earnings report, revealing an impressive 66% year-over-year revenue increase, far surpassing market expectations.
Temu stock price analysis
The earnings report drove PDD’s share price to $103.3, close to its 2023 high of nearly $104.7.
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The stock lost some of those gains over recent weeks, trading at $99.38 before the market opened on September 18.
The stock rose 0.4% during the September 15 trading session. Over the past week, PDD climbed around 3.9% and more than 24.4% in the past 30 days, adding around $28 billion in market cap during that period.
Year-to-date, Pinduoduo’s stock price is up over 16%.
The stock is currently facing resistance in a zone around $99.64, indicating a zone where selling pressure may increase. On the flip side, a support zone close to $96 is pointing to an area where buying pressure could surge in case of a downward move.
Investors open investigation into PDD after ‘spyware’ accusations
While PDD investors have enjoyed robust returns in the recent period, there may soon be reason for caution due to legal concerns.
Last week, the Frank R. Cruz legal firm opened an investigation into PDD on behalf of investors, citing a potential breach of federal securities regulations.
The move came after research firm Grizzly Research unveiled a report on September 7, alleging that PDD’s widely-used shopping app, Temu, “is the most dangerous malware/spyware package currently in widespread circulation.”
“The app has hidden functions that allow for extensive data exfiltration unbeknown to users, potentially giving bad actors full access to almost all data on customers’ mobile devices.”
– Grizzly Research stated in the report.
PDD”s shares fell on the report by nearly 5%.
Although the stock somewhat recovered since then, PDD investors could adopt a more cautious approach in the coming period, depending on the future developments in the ongoing investigation.
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