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Vipshop (VIPS) to Report Q3 Earnings: What's in the Offing?

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Vipshop Holdings Limited (VIPS - Free Report) is set to report third-quarter 2022 results on Nov 22.

VIPS expects third-quarter total net revenues between RMB 21.2 billion and RMB 22.4 billion, indicating a fall of 15-10% from the prior-year quarter’s reported figure.

The Zacks Consensus Estimate for revenues is pegged at $3.25 billion, suggesting a decline of 16% from the year-ago reported figure.

The consensus mark for earnings per share is pegged at 27 cents per share, indicating growth of 17.4% from the prior-year reported figure.

Vipshop’s earnings surpassed the Zacks Consensus Estimate in two of the trailing four quarters and missed the same twice, the average earnings surprise being 10.5%.

Vipshop Holdings Limited Price and EPS Surprise

Vipshop Holdings Limited Price and EPS Surprise

Vipshop Holdings Limited price-eps-surprise | Vipshop Holdings Limited Quote

Key Factors at Play

VIPS’ consistent efforts to strengthen product offerings and improve product procurement are expected to have benefited its third-quarter performance, given the growing proliferation of online shopping amid the pandemic.

Solid execution of Vipshop’s merchandising strategy is likely to have bolstered its total active customer base in the to-be-reported quarter.

Moreover, its successful transition to discount retailing remains a major positive. This is anticipated to have continued driving the momentum across repeated customers and helped attract the new ones.

Additionally, VIPS’ quarterly results are expected to reflect its deepening focus on high-margin-generating apparel-related businesses, especially the discount apparel business.

Moreover, the business is expected to have accelerated Vipshop’s gross merchandise volume (GMV) in the quarter under review. VIPS’ deep discount channels are expected to have bolstered its online GMV in the to-be-reported quarter.

However, weakening consumer demand in discretionary categories due to the challenging macro environment and the resurgence of COVID-19 in China might have continued hurting its performance during the quarter under review.

Also, intensifying competition in the online shopping market, which hiked Vipshop’s sales and marketing spending, is anticipated to get reflected in the third-quarter results.

What Our Model Says

Our proven model doesn’t conclusively predict an earnings beat for Vipshop this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. But that’s not the case here, as you see below. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Vipshop has an Earnings ESP of +1.89% and a Zacks Rank #4 (Sell).

Stocks to Consider

Here are some stocks worth considering, as our model shows that these have the right combination of elements to beat on earnings this season.

Dollar General (DG - Free Report) has an Earnings ESP of +1.58% and a Zacks Rank #2 at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

Dollar General is scheduled to release third-quarter fiscal 2022 results on Dec 1. The Zacks Consensus Estimate for DG’s earnings is pegged at $2.55 per share, suggesting a 22.6% increase from the prior-year fiscal quarter’s reported figure.

Adobe (ADBE - Free Report) has an Earnings ESP of +0.45% and a Zacks Rank of 3 at present.

Adobe is scheduled to release fourth-quarter fiscal 2022 results on Dec 15. The Zacks Consensus Estimate for ADBE’s earnings is pegged at $3.50 per share, suggesting a 9.4% rise from the prior-year fiscal quarter’s reported figure.

Dollar Tree (DLTR - Free Report) has an Earnings ESP of +6.31% and is presently Zacks #3 Ranked.

Dollar Tree is set to report third-quarter 2022 results on Nov 22. The Zacks Consensus Estimate for DLTR’s earnings is pegged at $1.16 per share, suggesting 20.8% growth from the prior-year period’s reported figure.

Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar.

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