Why This Analyst Downgraded Vipshop To Neutral?

JPMorgan analyst Andre Chang downgraded Vipshop Holdings Ltd VIPS to Neutral from Overweight with a price target of $11, down from $22, suggesting a 4.76% downside.
Despite the share price correcting by over 50% year-to-date, Chang does not expect the stock to outperform in the next six months.
Chang now projects Vipshop's second half of 2021 revenue to grow at only 5% year-over-year, with its margins set to drop further.
Chang notes that the "macro environment cool-down" turned out to be worse than expected, hitting discretionary items that Vipshop relies upon more than its peers.
Further, Chang adds that the company's sales and marketing expenses have not scaled back much, leading to concerns about short-term margins and the sustainability of user engagement.
Price Action: VIPS shares traded lower by 9.51% at $11.52 on the last check Thursday.