Bond.az – UBS upgraded Vipshop Holdings (NYSE:VIPS) to Buy from Neutral, while lowering its price target to $18.50 from $20.00.
Near-term growth is expected to remain pressured amid muted consumption and intense e-commerce competition. However, earnings resilience should be supported by strong first-party margin control and increasing contributions from Shanshan offline outlets.
Vipshop trades at 6 times 2026 estimated P/E, at the low end of its historical average. UBS believes the market has discounted most of the growth uncertainty.
Downside is cushioned with net cash at approximately 50% of market cap and approximately 14% committed shareholder returns. The current dividend yield stands at 4.16%. Even assuming a low single-digit EPS decline in 2026, this implies an approximately 10% total return.
Vipshop also reported Q1 2026 earnings, with EPS of 4.68 RMB surpassing forecasts. Revenue reached 26.6 billion RMB, slightly above expectations.
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