Vipshop Holdings Ltd ADR
VIPS: XNYS (USA)
Morningstar Rating for Stocks | Fair Value | Economic Moat | Capital Allocation |
---|---|---|---|
$37.50 | Xvln | Xzmcmpt |
Initiate on No-Moat Vipshop With Fair Value Estimate of USD 20.80; Shares Undervalued
We initiate on Vipshop with a fair value estimate of USD 20.80 per ADS, implying 2024 P/E of 6.8 times and free cash flow yield of 3.4%. We assign Vipshop a no moat rating as intensifying competition could erode its returns on invested capital in the coming decade. However, we think the shares are cheap currently. Thirty-seven percent of our Vipshop equity valuation comes from cash and cash equivalents.