Eddy Wang, an analyst from Morgan Stanley, maintained the Hold rating on Vipshop (VIPS – Research Report). The associated price target is $16.00.
Eddy Wang’s Hold rating on Vipshop’s stock can be attributed to several factors. Firstly, Wang anticipates a 4% year-on-year growth in 3Q23 revenue, which aligns closely with the company’s own projection. Furthermore, he expects a notable increase in the 4Q23 revenue due to the peak shopping season. He also predicts a steady gross profit margin (GPM) and continued share buyback activities, which are anticipated to bolster the stock price.
Wang also bases his rating on his analysis of Vipshop’s 3Q23 and 4Q23 outlook. He anticipates an increase in the company’s active users, primarily due to the re-engagement of inactive customers. Furthermore, he expects a rise in the average revenue per user (ARPU), propelled by the accelerated growth of SVIP members. Wang also foresees an improvement in both the gross and operating margins, thanks to a better brand and product mix, and operating leverage from general and administrative expenses. He also maintains a positive outlook for 2023, forecasting a 9% yoy revenue growth and an improved non-GAAP net margin. Despite reducing his revenue estimates by 1% for 2023-25, Wang’s earnings forecasts essentially remain unchanged, reinforcing his Hold rating for Vipshop.
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Vipshop (VIPS) Company Description:
VipShop Holdings Ltd. engages in the provision of online products sales and distributions services. It offers womenswear; menswear; footwear; accessories; handbags; apparel for children; sportswear and sporting goods; cosmetic goods; home and lifestyle products; luxury goods; and gifts and miscellaneous. It cooperates with domestic and overseas brand agents and manufacturers. The company was founded by Ya Shen and Xiao Bo Hong on August 22, 2008 and is headquartered in Guangzhou, China.
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