Nomura’s Instinet unit downgraded Vipshop Holdings to Neutral from Buy, citing persistent challenges in China’s retail sector and muted consumer confidence.
The brokerage also lowered its 12-month price target to $14 from $20, based on a fiscal 2027 price-to-earnings multiple of six times, assuming a 5% compound annual growth rate in non-GAAP earnings from 2026 to 2028. Benchmark analyst Fawne Jiang maintained a Hold rating on the stock.
Vipshop’s shares were trading at $13.41 at the time of the note, near the 52-week low of $12.65 and below the new target. The company trades at six times projected fiscal 2027 earnings and offers a dividend yield of 4.26%, having raised payouts for three consecutive years.
Vipshop has committed to returning 75% of its prior-year non-GAAP net profit to shareholders in both 2025 and 2026 through dividends and buybacks. For the first half of 2026, it returned $402 million—$303 million in cash dividends and $99 million via share repurchases—and plans an additional $535 million in buybacks in the second half. The full-year program is expected to total $937 million, equivalent to 75% of fiscal 2025 non-GAAP net profit.
Second-quarter results fell short of expectations, with earnings per ADS at $2.91 versus a $3.94 forecast and revenue of $24.71 billion against an estimate of $24.88 billion. The company attributed the miss to a weak retail environment in China, selective consumer spending, and limited visibility on a recovery in the second half of the year.
