Please ensure Javascript is enabled for purposes of website accessibility

Why Baozun, Inc. Stock Soared Today

By Steve Symington - May 17, 2018 at 1:24PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Chinese e-commerce solutions leader delivered a strong first quarter. Here's what investors need to know.

What happened

Shares of Baozun Inc. (ADR) (BZUN 3.56%) were up 17.8% as of 1:12 p.m. EDT Thursday after the Chinese e-commerce solutions company delivered better-than-expected first-quarter 2018 results. 

Baozun's quarterly revenue climbed 14.5% year over year to 921.2 million yuan ($146.9 million) -- well above Baozun's latest guidance for revenue of between $136.3 million and $141 million. That translated to adjusted net income attributable to Baozun shareholders of 31.9 million yuan ($5.1 million), or 0.57 yuan ($0.09) per share, beating consensus estimates by $0.01 per share.

Man wearing suit pointing to line chart indicating sharp gains

Image source: Getty Images.

So what

Baozun's top line included a 50.3% increase in services revenue to $73.5 million, which was partially offset by a 7.6% decline in product sales revenue to $73.3 million. Baozun notes that the latter was primarily driven by the transition of a single electronics brand partner's business from a distribution model to a consignment model last September.

Chairman and CEO Vincent Qiu called it an "outstanding quarter" that highlighted the growth of Baozun's online stores.

"We are firmly focused on becoming the leading brand e-commerce business partner and technology development and solutions services provider," Qiu added. "We plan to continue investing in innovation to further strengthen our industry leading position and create greater value for shareholders."

Now what

For the second quarter, Baozun anticipates revenue of between 1.06 billion yuan ($166.4 million) to 1.10 billion yuan ($172.7 million) -- again well above most investors' models for second-quarter sales of $164.9 million.

In the end, this was a straightforward quarterly beat followed by an encouraging outlook, and it should be hardly surprising to see Baozun stock hitting a fresh 52-week high in response.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Baozun Stock Quote
Baozun
BZUN
$11.33 (3.56%) $0.39

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning analyst team.

Stock Advisor Returns
311%
 
S&P 500 Returns
110%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 07/02/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.