Expecting user and revenue growth to slow to the single digits for the next few quarters, UBS downgrades Vipshop from Buy to Neutral with a $17 price target.
The firm notes that Vipshop provided “disappointing” third-quarter revenue guidance for 5% to 10% year-over-year growth, well below the historical norm of low-teens growth, which can’t fully be explained by tougher comps since VIPS benefitted from the pandemic-driven shift towards e-commerce.
“We believe increasing competition from e-commerce live streaming is an issue, and could limit VIPS’s long term growth, as multiple apps go after a value-oriented shoppers,” says UBS.
Vipshop shares are down 2.4% pre-market to $15.30.
Last month, Vipshop reported a second-quarter earnings miss.
Author: Brandy Betz, Seeking Alpha