UPDATE: JPMorgan Downgrades Vipshop Holdings (VIPS) to Neutral

JPMorgan analyst Andrew Chang downgraded Vipshop Holdings (NYSE: VIPS) from Overweight to Neutral with a price target of $11.00 (from $22.00).

The analyst comments "Despite the share price correcting meaningfully YTD, we don’t expect the stock to outperform in the next six months, as we were wrong about the following: 1) the macro environment cool-down turned out to be worse than expected (as evidenced by China online retail sales in August), hitting discretionary items that Vipshop relies upon more than its peers; and 2) its sales and marketing expenses haven’t been scaled back much based on our observations, leading to concerns about shortterm margins and the sustainability of user engagement. We now project 2H21 revenue to grow at only 5% YoY, with its margins set to drop further QoQ/YoY. We expect Bloomberg consensus earnings estimates to be cut further, and believe its inexpensive P/E alone won’t stimulate the stock to perform, leaving it as the least attractive e-commerce stock under our coverage. Neutral."

For an analyst ratings summary and ratings history on Vipshop Holdings click here. For more ratings news on Vipshop Holdings click here.

Shares of Vipshop Holdings closed at $12.73 yesterday.

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