Our Stock of the Week is Baozun (BZUN). BZUN is known as the Shopify (SHOP) of China. If you aren’t familiar with SHOP, it offers a complete ecommerce solution for online retailers. It allows you to offer products, customize a storefront, accept credit cards, tack orders, etc.
BZUN provides the same services in China but so far it has been focused primarily on large customers such as Microsoft (MSFT), Nike (NKE) and the NBA. Presently it has over 150 clients that are all big brands.
It’s conference call, following fourth quarter earnings, the company indicated that it is looking to broaden into small clients. In the US, SHOP has over 600,000 small clients at the end of 2017.
The prospects for substantial growth are there for SHOP and the last earnings report as a taste of what may come. The company posted eps of $0.42 versus $0.18 in the prior year for gowth of 133%. Revenues were up 31%. Earnings estimates for the year ahead are inching higher and are now at $1.88
Technically the stock gapped up on its good earnings and has been forming a high, tight flag. It needs a close over the $49 area to bring in new momentum buyers.
As always we would not chase the open on Monday morning but would look for entry either on low volume pullbacks or strong volume breakouts.
This post is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this post. Do not buy, sell or trade the stocks mentioned herein. We WILL actively trade this stock differently than discussed herein. We will sell into strength, and will buy or sell at any time for any reason. We will actively trade into any unusual activity. At the time of this post, principals, employees and affiliates of Shark Investing, Inc. and/or principals, employees and affiliates of Shark Asset Management, Inc. ("SAMI"), directly or indirectly, controlled investment and/or trading accounts containing positions in BZUN. To accommodate the objectives of these investing and/or trading accounts, the trading in these shares will be contrary to and/or inconsistent with the information contained in this posting.