Yahoo Finance Results: Vipshop Holdings Limited Beat Earnings Expectations And Analysts Now Have New Forecasts
Vipshop Holdings Limited (NYSE:VIPS) investors will be delighted, with the company turning in some strong numbers with its latest results. The company beat both earnings and revenue forecasts, with revenue of CN¥23b, some 7.7% above estimates, and statutory earnings per share (EPS) coming in at CN¥1.80, 34% ahead of expectations. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. Readers will be glad to know we've aggregated the latest statutory forecasts to see whether the analysts have changed their mind on Vipshop Holdings after the latest results.
Check out our latest analysis for Vipshop Holdings
Taking into account the latest results, the most recent consensus for Vipshop Holdings from 25 analysts is for revenues of CN¥115.3b in 2021 which, if met, would be a substantial 21% increase on its sales over the past 12 months. Per-share earnings are expected to bounce 23% to CN¥9.01. Before this earnings report, the analysts had been forecasting revenues of CN¥109.8b and earnings per share (EPS) of CN¥8.78 in 2021. So there seems to have been a moderate uplift in sentiment following the latest results, given the upgrades to both revenue and earnings per share forecasts for next year.
With these upgrades, we're not surprised to see that the analysts have lifted their price target 10% to CN¥162per share. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. There are some variant perceptions on Vipshop Holdings, with the most bullish analyst valuing it at CN¥33.11 and the most bearish at CN¥14.55 per share. Still, with such a tight range of estimates, it suggeststhe analysts have a pretty good idea of what they think the company is worth.
Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. The analysts are definitely expecting Vipshop Holdings' growth to accelerate, with the forecast 21% growth ranking favourably alongside historical growth of 17% per annum over the past five years. Other similar companies in the industry (with analyst coverage) are also forecast to grow their revenue at 17% per year. Vipshop Holdings is expected to grow at about the same rate as its industry, so it's not clear that we can draw any conclusions from its growth relative to competitors.
The Bottom Line
The biggest takeaway for us is the consensus earnings per share upgrade, which suggests a clear improvement in sentiment around Vipshop Holdings' earnings potential next year. There was also an upgrade to revenue estimates, although as we saw earlier, forecast growth is only expected to be about the same as the wider industry. We note an upgrade to the price target, suggesting that the analysts believes the intrinsic value of the business is likely to improve over time.
With that in mind, we wouldn't be too quick to come to a conclusion on Vipshop Holdings. Long-term earnings power is much more important than next year's profits. We have forecasts for Vipshop Holdings going out to 2023, and you can see them free on our platform here.
And what about risks? Every company has them, and we've spotted 1 warning sign for Vipshop Holdings you should know about.
This article by Simply Wall St is general in nature. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.
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