The allegations concern Vipshop's method of revenue recognition, inventory accounting, capital expenditures, cash flow, and more. But Vipshop issued a response Wednesday morning to categorically deny all allegations.
"Vipshop believes these allegations are unfounded and contain numerous errors, unsupported speculation, and a general misunderstanding of the company's business model," the company said in a statement. "The company has made its board of directors and its independent auditors aware of the reports, and will continue to review and address the allegations as appropriate."
Vipshop will release its first-quarter earnings after the market close today.
More than 15.1 million shares had changed hands as of 10:56 a.m., compared to the daily average volume of 6,057,120.
Separately, TheStreet Ratings team rates VIPSHOP HOLDINGS LTD -ADR as a Buy with a ratings score of B. TheStreet Ratings Team has this to say about their recommendation:
"We rate VIPSHOP HOLDINGS LTD -ADR (VIPS) a BUY. This is driven by multiple strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, notable return on equity, impressive record of earnings per share growth, compelling growth in net income and solid stock price performance. We feel its strengths outweigh the fact that the company has had generally high debt management risk by most measures that we evaluated."