Piper Jaffray Downgrades Zulily, Inc (ZU) to Neutral

Piper Jaffray downgraded Zulily, Inc (NASDAQ: ZU) from Overweight to Neutral with a price target of $15.00 (from $45.00) following weak Q4 results and outlook.

Analyst Neely Tamminga commented, "In view of the significant miss to our expectations in reporting Q4, we are moving to the sidelines on ZU shares from Overweight to Neutral and removing ZU from our top ideas for 2015. What with a miss to active customers (4.9M vs. PJCe 5.2M), we believe ZU shares are likely to remain range-bound as key growth metrics slow faster-thananticipated. Moreover, the financial metrics in the quarter seemingly all went the wrong way—revenues were lower, gross margin was lower, marketing expenses were higher and guidance for FQ1 was uninspiring. All told, we believe investors may be more apt to consider an earlier stage (in terms of customer acquisition) specialty eCommerce story like Wayfair trading at a discount to ZU on an EV/sales basis."

The firm cut FY 2015 EPS from $0.42 to $0.29, FY 2016 EPS from $0.63 to $0.47.

For an analyst ratings summary and ratings history on Zulily, Inc click here. For more ratings news on Zulily, Inc click here.

Shares of Zulily, Inc closed at $19.89 yesterday.

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