Trade-Ideas: Vipshop Holdings Ltd ADR (VIPS) Is Today's Post-Market Leader Stock

Editor's Note: Any reference to TheStreet Ratings and its underlying recommendation does not reflect the opinion of TheStreet, Inc. or any of its contributors including Jim Cramer or Stephanie Link.

Trade-Ideas LLC identified Vipshop Holdings Ltd ADR ( VIPS) as a post-market leader candidate. In addition to specific proprietary factors, Trade-Ideas identified Vipshop Holdings Ltd ADR as such a stock due to the following factors:

  • VIPS has an average dollar-volume (as measured by average daily share volume multiplied by share price) of $176.0 million.
  • VIPS is up 4.6% today from today's close.

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More details on VIPS:

Vipshop Holdings Limited, through its subsidiaries, operates as an online discount retailer for various brands in the People's Republic of China. VIPS has a PE ratio of 174.8. Currently there are 9 analysts that rate Vipshop Holdings Ltd ADR a buy, no analysts rate it a sell, and 1 rates it a hold.

The average volume for Vipshop Holdings Ltd ADR has been 9.9 million shares per day over the past 30 days. Vipshop Holdings Ltd ADR has a market cap of $1.4 billion and is part of the services sector and retail industry. Shares are up 186.7% year-to-date as of the close of trading on Monday.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

TheStreetRatings.com Analysis:

TheStreet Quant Ratings rates Vipshop Holdings Ltd ADR as a hold. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity and impressive record of earnings per share growth. However, as a counter to these strengths, we also find weaknesses including generally higher debt management risk and poor profit margins.

Highlights from the ratings report include:
  • VIPS's very impressive revenue growth greatly exceeded the industry average of 12.6%. Since the same quarter one year prior, revenues leaped by 136.1%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • VIPSHOP HOLDINGS LTD -ADR reported significant earnings per share improvement in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past year. We feel that this trend should continue. This trend suggests that the performance of the business is improving. During the past fiscal year, VIPSHOP HOLDINGS LTD -ADR turned its bottom line around by earning $0.09 versus -$0.02 in the prior year. This year, the market expects an improvement in earnings ($0.31 versus $0.09).
  • The gross profit margin for VIPSHOP HOLDINGS LTD -ADR is rather low; currently it is at 24.81%. Regardless of VIPS's low profit margin, it has managed to increase from the same period last year. Despite the mixed results of the gross profit margin, the net profit margin of 3.18% trails the industry average.
  • The debt-to-equity ratio is very high at 2.00 and currently higher than the industry average, implying increased risk associated with the management of debt levels within the company. Even though the debt-to-equity ratio is weak, VIPS's quick ratio is somewhat strong at 1.24, demonstrating the ability to handle short-term liquidity needs.

STOCKS TO BUY: TheStreet Quant Ratings has identified a handful of stocks that can potentially TRIPLE in the next 12 months. Learn more.

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