Intrinsic value of JD.com, Inc. - JD

Previous Close

$30.46

  Intrinsic Value

$173.61

stock screener

  Rating & Target

str. buy

+470%

Previous close

$30.46

 
Intrinsic value

$173.61

 
Up/down potential

+470%

 
Rating

str. buy

We calculate the intrinsic value of JD stock by summing up the current values of future distributable cash flows generated by the company and dividing the sum by the number of outstanding shares. As such, the intrinsic value calculation depends entirely on projections. The more accurate your projections of the company's performance are - the more reliable is the intrinsic value calculation result. Please make sure to check the stock valuation input data below and adjust it if necessary. The quality of the output (intrinsic valuation result) is only as good as the quality of the input. See also DISCLAIMERS.

STOCK VALUATION INPUT DATA

Initial revenue growth rate, %
Terminal revenue growth rate, %
Revenue decline factor
Initial discount rate, %
Discount rate multiplier
Shares outstanding, mln

 

FINANCIAL STATEMENTS FORECAST and PRESENT VALUE CALCULATION

Fiscal year
2016(a)
   2017
   2018
   2019
   2020
   2021
   2022
   2023
   2024
   2025
   2026
   2027
   2028
   2029
   2030
   2031
   2032
   2033
   2034
   2035
   2036
   2037
   2038
   2039
   2040
   2041
   2042
   2043
   2044
   2045
   2046

INCOME STATEMENT

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue growth rate, %
  43.49
  47.30
  43.07
  39.26
  35.84
  32.75
  29.98
  27.48
  25.23
  23.21
  21.39
  19.75
  18.27
  16.95
  15.75
  14.68
  13.71
  12.84
  12.05
  11.35
  10.71
  10.14
  9.63
  9.17
  8.75
  8.37
  8.04
  7.73
  7.46
  7.21
  6.99
Revenue, $m
  37,632
  80,670
  115,415
  160,730
  218,331
  289,841
  376,729
  480,253
  601,431
  741,015
  899,503
  1,077,147
  1,273,987
  1,489,886
  1,724,574
  1,977,688
  2,248,813
  2,537,522
  2,843,406
  3,166,105
  3,505,324
  3,860,859
  4,232,598
  4,620,541
  5,024,793
  5,445,575
  5,883,220
  6,338,172
  6,810,982
  7,302,310
  7,812,916
Variable operating expenses, $m
 
  80,316
  114,805
  159,787
  216,964
  287,948
  374,197
  476,961
  597,247
  735,805
  893,127
  1,069,226
  1,264,619
  1,478,931
  1,711,893
  1,963,146
  2,232,278
  2,518,863
  2,822,499
  3,142,824
  3,479,549
  3,832,469
  4,201,476
  4,586,565
  4,987,845
  5,405,533
  5,839,960
  6,291,567
  6,760,901
  7,248,616
  7,755,467
Fixed operating expenses, $m
 
  307
  313
  320
  327
  334
  342
  349
  357
  365
  373
  381
  390
  398
  407
  416
  425
  434
  444
  454
  464
  474
  484
  495
  506
  517
  528
  540
  552
  564
  576
Total operating expenses, $m
  37,943
  80,623
  115,118
  160,107
  217,291
  288,282
  374,539
  477,310
  597,604
  736,170
  893,500
  1,069,607
  1,265,009
  1,479,329
  1,712,300
  1,963,562
  2,232,703
  2,519,297
  2,822,943
  3,143,278
  3,480,013
  3,832,943
  4,201,960
  4,587,060
  4,988,351
  5,406,050
  5,840,488
  6,292,107
  6,761,453
  7,249,180
  7,756,043
Operating income, $m
  -310
  48
  297
  623
  1,040
  1,558
  2,190
  2,944
  3,827
  4,845
  6,003
  7,539
  8,978
  10,557
  12,274
  14,126
  16,111
  18,224
  20,464
  22,827
  25,311
  27,915
  30,638
  33,480
  36,442
  39,525
  42,731
  46,065
  49,530
  53,130
  56,873
EBITDA, $m
  216
  939
  1,468
  2,161
  3,043
  4,139
  5,473
  7,063
  8,926
  11,073
  13,511
  16,245
  19,275
  22,599
  26,212
  30,110
  34,286
  38,733
  43,445
  48,416
  53,642
  59,120
  64,847
  70,824
  77,053
  83,537
  90,281
  97,291
  104,578
  112,149
  120,018
Interest expense (income), $m
  106
  194
  703
  1,386
  2,277
  3,410
  4,816
  6,525
  8,560
  10,943
  13,688
  16,804
  20,298
  24,168
  28,414
  33,028
  38,006
  43,337
  49,014
  55,029
  61,374
  68,045
  75,036
  82,346
  89,974
  97,923
  106,197
  114,803
  123,749
  133,047
  142,708
Earnings before tax, $m
  -468
  -146
  -406
  -763
  -1,238
  -1,852
  -2,626
  -3,581
  -4,734
  -6,098
  -7,685
  -9,265
  -11,319
  -13,611
  -16,140
  -18,902
  -21,895
  -25,113
  -28,550
  -32,202
  -36,063
  -40,129
  -44,398
  -48,865
  -53,532
  -58,398
  -63,466
  -68,738
  -74,219
  -79,916
  -85,835
Tax expense, $m
  26
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Net income, $m
  -551
  -146
  -406
  -763
  -1,238
  -1,852
  -2,626
  -3,581
  -4,734
  -6,098
  -7,685
  -9,265
  -11,319
  -13,611
  -16,140
  -18,902
  -21,895
  -25,113
  -28,550
  -32,202
  -36,063
  -40,129
  -44,398
  -48,865
  -53,532
  -58,398
  -63,466
  -68,738
  -74,219
  -79,916
  -85,835

BALANCE SHEET

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Cash and short-term investments, $m
  3,199
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Total assets, $m
  23,202
  40,970
  58,616
  81,630
  110,884
  147,202
  191,330
  243,907
  305,450
  376,341
  456,832
  547,053
  647,022
  756,671
  875,863
  1,004,412
  1,142,109
  1,288,736
  1,444,087
  1,607,976
  1,780,256
  1,960,822
  2,149,618
  2,346,643
  2,551,952
  2,765,655
  2,987,923
  3,218,980
  3,459,107
  3,708,639
  3,967,961
Adjusted assets (=assets-cash), $m
  20,003
  40,970
  58,616
  81,630
  110,884
  147,202
  191,330
  243,907
  305,450
  376,341
  456,832
  547,053
  647,022
  756,671
  875,863
  1,004,412
  1,142,109
  1,288,736
  1,444,087
  1,607,976
  1,780,256
  1,960,822
  2,149,618
  2,346,643
  2,551,952
  2,765,655
  2,987,923
  3,218,980
  3,459,107
  3,708,639
  3,967,961
Revenue / Adjusted assets
  1.881
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
  1.969
Average production assets, $m
  1,750
  4,760
  6,809
  9,483
  12,882
  17,101
  22,227
  28,335
  35,484
  43,720
  53,071
  63,552
  75,165
  87,903
  101,750
  116,684
  132,680
  149,714
  167,761
  186,800
  206,814
  227,791
  249,723
  272,612
  296,463
  321,289
  347,110
  373,952
  401,848
  430,836
  460,962
Working capital, $m
  317
  -7,502
  -10,734
  -14,948
  -20,305
  -26,955
  -35,036
  -44,664
  -55,933
  -68,914
  -83,654
  -100,175
  -118,481
  -138,559
  -160,385
  -183,925
  -209,140
  -235,990
  -264,437
  -294,448
  -325,995
  -359,060
  -393,632
  -429,710
  -467,306
  -506,438
  -547,139
  -589,450
  -633,421
  -679,115
  -726,601
Total debt, $m
  2,931
  13,020
  25,672
  42,174
  63,149
  89,189
  120,828
  158,526
  202,652
  253,481
  311,194
  375,881
  447,560
  526,178
  611,639
  703,808
  802,537
  907,669
  1,019,055
  1,136,563
  1,260,088
  1,389,554
  1,524,921
  1,666,188
  1,813,394
  1,966,619
  2,125,985
  2,291,653
  2,463,825
  2,642,739
  2,828,673
Total liabilities, $m
  18,298
  29,376
  42,028
  58,529
  79,504
  105,544
  137,184
  174,882
  219,008
  269,837
  327,549
  392,237
  463,915
  542,533
  627,994
  720,164
  818,892
  924,024
  1,035,410
  1,152,919
  1,276,444
  1,405,909
  1,541,276
  1,682,543
  1,829,749
  1,982,975
  2,142,341
  2,308,009
  2,480,180
  2,659,094
  2,845,028
Total equity, $m
  4,903
  11,595
  16,588
  23,101
  31,380
  41,658
  54,146
  69,026
  86,442
  106,505
  129,284
  154,816
  183,107
  214,138
  247,869
  284,249
  323,217
  364,712
  408,676
  455,057
  503,812
  554,913
  608,342
  664,100
  722,202
  782,680
  845,582
  910,971
  978,927
  1,049,545
  1,122,933
Total liabilities and equity, $m
  23,201
  40,971
  58,616
  81,630
  110,884
  147,202
  191,330
  243,908
  305,450
  376,342
  456,833
  547,053
  647,022
  756,671
  875,863
  1,004,413
  1,142,109
  1,288,736
  1,444,086
  1,607,976
  1,780,256
  1,960,822
  2,149,618
  2,346,643
  2,551,951
  2,765,655
  2,987,923
  3,218,980
  3,459,107
  3,708,639
  3,967,961
Debt-to-equity ratio
  0.598
  1.120
  1.550
  1.830
  2.010
  2.140
  2.230
  2.300
  2.340
  2.380
  2.410
  2.430
  2.440
  2.460
  2.470
  2.480
  2.480
  2.490
  2.490
  2.500
  2.500
  2.500
  2.510
  2.510
  2.510
  2.510
  2.510
  2.520
  2.520
  2.520
  2.520
Adjusted equity ratio
  0.099
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283
  0.283

CASH FLOW

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net income, $m
  -551
  -146
  -406
  -763
  -1,238
  -1,852
  -2,626
  -3,581
  -4,734
  -6,098
  -7,685
  -9,265
  -11,319
  -13,611
  -16,140
  -18,902
  -21,895
  -25,113
  -28,550
  -32,202
  -36,063
  -40,129
  -44,398
  -48,865
  -53,532
  -58,398
  -63,466
  -68,738
  -74,219
  -79,916
  -85,835
Depreciation, amort., depletion, $m
  526
  890
  1,171
  1,537
  2,003
  2,581
  3,283
  4,120
  5,099
  6,227
  7,508
  8,706
  10,297
  12,042
  13,938
  15,984
  18,175
  20,509
  22,981
  25,589
  28,331
  31,204
  34,209
  37,344
  40,611
  44,012
  47,549
  51,226
  55,048
  59,019
  63,145
Funds from operations, $m
  1,740
  744
  765
  774
  765
  729
  657
  539
  366
  130
  -177
  -560
  -1,023
  -1,570
  -2,201
  -2,918
  -3,720
  -4,604
  -5,569
  -6,613
  -7,732
  -8,925
  -10,189
  -11,521
  -12,921
  -14,386
  -15,917
  -17,512
  -19,172
  -20,897
  -22,690
Change in working capital, $m
  472
  -2,409
  -3,231
  -4,214
  -5,357
  -6,650
  -8,081
  -9,628
  -11,269
  -12,981
  -14,739
  -16,521
  -18,306
  -20,079
  -21,826
  -23,540
  -25,215
  -26,850
  -28,447
  -30,011
  -31,547
  -33,065
  -34,572
  -36,079
  -37,595
  -39,133
  -40,701
  -42,311
  -43,971
  -45,693
  -47,486
Cash from operations, $m
  1,268
  3,153
  3,996
  4,989
  6,122
  7,380
  8,737
  10,167
  11,635
  13,111
  14,562
  15,961
  17,283
  18,509
  19,625
  20,621
  21,495
  22,246
  22,878
  23,398
  23,815
  24,139
  24,383
  24,557
  24,675
  24,746
  24,784
  24,799
  24,800
  24,796
  24,796
Maintenance CAPEX, $m
  0
  -443
  -652
  -933
  -1,299
  -1,765
  -2,343
  -3,045
  -3,882
  -4,861
  -5,989
  -7,270
  -8,706
  -10,297
  -12,042
  -13,938
  -15,984
  -18,175
  -20,509
  -22,981
  -25,589
  -28,331
  -31,204
  -34,209
  -37,344
  -40,611
  -44,012
  -47,549
  -51,226
  -55,048
  -59,019
New CAPEX, $m
  -449
  -1,526
  -2,050
  -2,674
  -3,398
  -4,219
  -5,126
  -6,108
  -7,149
  -8,235
  -9,351
  -10,481
  -11,614
  -12,738
  -13,847
  -14,934
  -15,996
  -17,034
  -18,047
  -19,039
  -20,014
  -20,977
  -21,933
  -22,889
  -23,851
  -24,826
  -25,821
  -26,842
  -27,896
  -28,988
  -30,126
Cash from investing activities, $m
  -6,983
  -1,969
  -2,702
  -3,607
  -4,697
  -5,984
  -7,469
  -9,153
  -11,031
  -13,096
  -15,340
  -17,751
  -20,320
  -23,035
  -25,889
  -28,872
  -31,980
  -35,209
  -38,556
  -42,020
  -45,603
  -49,308
  -53,137
  -57,098
  -61,195
  -65,437
  -69,833
  -74,391
  -79,122
  -84,036
  -89,145
Free cash flow, $m
  -5,715
  1,185
  1,294
  1,382
  1,425
  1,396
  1,269
  1,014
  604
  15
  -777
  -1,790
  -3,036
  -4,526
  -6,263
  -8,251
  -10,485
  -12,963
  -15,678
  -18,622
  -21,788
  -25,168
  -28,754
  -32,540
  -36,520
  -40,691
  -45,049
  -49,593
  -54,323
  -59,240
  -64,348
Issuance/(repayment) of debt, $m
  3,151
  9,422
  12,652
  16,501
  20,975
  26,040
  31,640
  37,698
  44,126
  50,829
  57,712
  64,688
  71,678
  78,619
  85,460
  92,170
  98,729
  105,132
  111,386
  117,509
  123,525
  129,466
  135,367
  141,267
  147,206
  153,225
  159,366
  165,668
  172,171
  178,914
  185,934
Issuance/(repurchase) of shares, $m
  196
  3,875
  5,400
  7,276
  9,516
  12,130
  15,114
  18,461
  22,150
  26,160
  30,464
  34,798
  39,611
  44,642
  49,871
  55,282
  60,863
  66,608
  72,514
  78,583
  84,818
  91,230
  97,827
  104,624
  111,635
  118,877
  126,368
  134,127
  142,175
  150,534
  159,224
Cash from financing (excl. dividends), $m  
  5,888
  13,297
  18,052
  23,777
  30,491
  38,170
  46,754
  56,159
  66,276
  76,989
  88,176
  99,486
  111,289
  123,261
  135,331
  147,452
  159,592
  171,740
  183,900
  196,092
  208,343
  220,696
  233,194
  245,891
  258,841
  272,102
  285,734
  299,795
  314,346
  329,448
  345,158
Total cash flow (excl. dividends), $m
  276
  14,481
  19,346
  25,160
  31,916
  39,566
  48,023
  57,172
  66,880
  77,004
  87,399
  97,696
  108,253
  118,735
  129,068
  139,201
  149,106
  158,777
  168,222
  177,469
  186,555
  195,528
  204,440
  213,350
  222,320
  231,411
  240,685
  250,203
  260,024
  270,208
  280,810
Retained Cash Flow (-), $m
  -478
  -3,875
  -5,400
  -7,276
  -9,516
  -12,130
  -15,114
  -18,461
  -22,150
  -26,160
  -30,464
  -34,798
  -39,611
  -44,642
  -49,871
  -55,282
  -60,863
  -66,608
  -72,514
  -78,583
  -84,818
  -91,230
  -97,827
  -104,624
  -111,635
  -118,877
  -126,368
  -134,127
  -142,175
  -150,534
  -159,224
Prev. year cash balance distribution, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash flow adjustment, $m
 
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
  0
Cash available for distribution, $m
 
  10,606
  13,946
  17,884
  22,400
  27,436
  32,908
  38,712
  44,730
  50,844
  56,935
  62,898
  68,642
  74,093
  79,197
  83,919
  88,243
  92,168
  95,708
  98,887
  101,737
  104,298
  106,613
  108,727
  110,686
  112,534
  114,317
  116,075
  117,849
  119,674
  121,586
Discount rate, %
 
  4.30
  4.52
  4.74
  4.98
  5.23
  5.49
  5.76
  6.05
  6.35
  6.67
  7.00
  7.35
  7.72
  8.11
  8.51
  8.94
  9.39
  9.86
  10.35
  10.87
  11.41
  11.98
  12.58
  13.21
  13.87
  14.56
  15.29
  16.05
  16.86
  17.70
PV of cash for distribution, $m
 
  10,169
  12,767
  15,564
  18,444
  21,266
  23,883
  26,153
  27,958
  29,207
  29,849
  29,869
  29,292
  28,172
  26,588
  24,637
  22,424
  20,054
  17,626
  15,226
  12,928
  10,788
  8,846
  7,126
  5,637
  4,378
  3,335
  2,491
  1,823
  1,306
  916
Current shareholders' claim on cash, %
  100
  91.9
  84.9
  78.7
  73.3
  68.6
  64.4
  60.7
  57.4
  54.5
  51.8
  49.5
  47.3
  45.3
  43.5
  41.9
  40.3
  38.9
  37.6
  36.3
  35.1
  34.0
  33.0
  32.0
  31.1
  30.2
  29.4
  28.5
  27.8
  27.0
  26.3

JD.com, Inc. is an online direct sales company. The Company engages in the sale of electronics and home appliance products and general merchandise products (including audio, video products and books) sourced from manufacturers, distributors and publishers in China on the Internet through its Website, www.jd.com. It also offers an online marketplace that enables third-party sellers to sell their products to customers on the Company's Website. The Company operates through the provision of a single class of services for accelerating and improving the delivery of its products over the Internet. The Company also offers online and in-person payment options and customer services. The Company operates approximately 210 warehouses with an aggregate gross floor area of approximately four million square meters in over 50 cities. It operates over 5,370 delivery stations and pickup stations in approximately 2,350 counties and districts across China.

FINANCIAL RATIOS  of  JD.com, Inc. (JD)

Valuation Ratios
P/E Ratio -156.8
Price to Sales 2.3
Price to Book 17.6
Price to Tangible Book
Price to Cash Flow 68.1
Price to Free Cash Flow 105.5
Growth Rates
Sales Growth Rate 43.5%
Sales - 3 Yr. Growth Rate %
EPS Growth Rate %
EPS - 3 Yr. Growth Rate %
Capital Spending Gr. Rate -17.5%
Cap. Spend. - 3 Yr. Gr. Rate 41.2%
Financial Strength
Quick Ratio 2
Current Ratio 0.2
LT Debt to Equity 27%
Total Debt to Equity 59.8%
Interest Coverage -3
Management Effectiveness
Return On Assets -2.5%
Ret/ On Assets - 3 Yr. Avg. -8.4%
Return On Total Capital -8.4%
Ret/ On T. Cap. - 3 Yr. Avg. -17.5%
Return On Equity -11.8%
Return On Equity - 3 Yr. Avg. -20%
Asset Turnover 2.1
Profitability Ratios
Gross Margin 15.2%
Gross Margin - 3 Yr. Avg. 13.4%
EBITDA Margin 0.4%
EBITDA Margin - 3 Yr. Avg. -2%
Operating Margin -0.8%
Oper. Margin - 3 Yr. Avg. -3.1%
Pre-Tax Margin -1.2%
Pre-Tax Margin - 3 Yr. Avg. -3.5%
Net Profit Margin -1.5%
Net Profit Margin - 3 Yr. Avg. -3.6%
Effective Tax Rate -5.6%
Eff/ Tax Rate - 3 Yr. Avg. -1.9%
Payout Ratio 0%

JD stock valuation input parameters

Revenue. Company's revenue (or sales) is always the starting point of any cash flow forecast. In the JD stock intrinsic value calculation we used $54766 million for the last fiscal year's total revenue generated by JD.com, Inc.. The default revenue input number comes from 2016 income statement of JD.com, Inc.. You may change it if you feel that it should be adjusted for some unusual circumstances that are not expected to be repeated in the future or if you already know (from interim financial statements, for example) that this year's revenue is going to be quite different.

Revenue growth rate. Forecasted future revenue growth rate is the most important input parameter for the intrinsic value calculation. Unlike other input parameters that are reasonably expected to be in line with their historic averages or their historic trends, the revenue growth rate by and large is a wild card: nobody really knows what the company's revenue will be in the future. Of course, the level of unpredictability is different for different industries (utility companies being the most predictable and, thus, less risky).
    We use three input parameters to forecast the revenue growth rate in our JD stock valuation model: a) initial revenue growth rate of 47.3% whose default value is the revenue growth rate in the most recent quarter compared to the quarterly revenue a year ago; b) terminal revenue growth rate of 5% whose default value is chosen to be close to the average nominal (i.e. not adjusted for inflation) GDP growth rate; and c) revenue decline factor of 0.9, which stipulates that revenue growth rate in each forecasted year will be equal to the difference of the revenue growth rate in the preceding year and the terminal revenue growth rate multiplied by this revenue decline factor (with the passage of time the revenue growth rate will be approaching the terminal revenue growth rate, but not quite reaching it - though the difference could be infinitesimally small).
    At the revenue decline factor of 1, the future revenue growth rate is forecasted to be constant and equal to the initial revenue growth rate. The smaller the revenue decline factor, the faster the revenue growth rate will approach the terminal revenue growth.

Discount rate. The discount rate is used for determining the present value of future cash flows: future cash flows are "discounted" as at normal conditions (that translate into positive expected return on investment) one dollar today is worth more than the same dollar in the future. Unlike all other valuation models, we use variable discount rate, i.e. it increases for each consecutive year. This is done to account for higher risk of cash flows coming in further in the future.
    The initial discount rate of 4.3%, whose default value for JD is calculated based on our internal credit rating of JD.com, Inc., is applied to the cash flow expected to be received a year from now (well, actually, to be precise, in the financial year following the base year - the last year for which we have financial statements). For each consecutive year the discount rate is multiplied by the discount rate multiplier of 1.05, e.i. each year it increases by 5%. Feel free to change this number to correspond to your level of risk assessment of JD.com, Inc..
    By the way, it is easy to set the discount rate to be constant (this would make comparison with other valuation models easier): just set the discount rate multiplier equal to 1 and chose the magnitude of the initial discount rate to your liking.

Variable cost ratio is the ratio of variable costs (i.e. costs that fluctuate with fluctuation of the volume of production) to the revenue expressed as a percentage. In the calculation of intrinsic value of JD stock the variable cost ratio is equal to 99.7%.

Fixed operating expenses is just that - expenses that are not dependant on the volume of production. They are set to $300 million in the base year in the intrinsic value calculation for JD stock. These expenses increase with the level of inflation in subsequent years.

Interest rate on debt is the average all-in rate of interest paid by the company on its debt. It is set at 5.4% for JD.com, Inc..

Corporate tax rate of 27% is the nominal tax rate for JD.com, Inc.. In reality, companies find ways to pay much less taxes than that or not to pay them at all.

Cash flow adjustment could be used for any adjustment the investor deems necessary. Most commonly we use this field to account for stock options-related effects in excess of what is reported on the company's income statement. The cash flow adjustment is expressed as a percentage of the revenue, and in the current valuation of the JD stock is equal to 0%.

Production assets are the company's assets used for manufacturing products or provision of services. In the valuation model input table they are expressed as a percentage of revenue and for JD are equal to 5.9%.

Life of production assets of 7.3 years is the average useful life of capital assets used in JD.com, Inc. operations. It is used to calculate yearly capital expenditures needed to keep these assets in good order - we call it the maintenance CAPEX.

Working capital is the difference between the company's current assets and liabilities. In the model we use the ratio of working capital to revenue, which for JD is equal to -9.3%. A negative number means that the company is apt at using financial resources of its suppliers and customers; a large positive number, on the other hand, means that it either provides in-kind financing to others or is not good at managing its inventories.

Book value of equity - $7865.90296252 million for JD.com, Inc. - is used in calculation of the "floor" for intrinsic valuation based on the discounted cash flow (DCF) method. Even if the prospects are very bad for a company, its assets could always be sold now for their current fair market value.

Shares outstanding of 1447.189 million for JD.com, Inc. is needed to calculate the intrinsic value of one share.

Market capitalization is used here only for reference purposes and as a quick check that the share price and the number of shares outstanding numbers are correct - something especially to be cognizant about at stock splits. So, the market capitalization of JD.com, Inc. at the current share price and the inputted number of shares is $44.1 billion.

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