BEST Inc Receives a Buy from Oppenheimer


In a report released today, Scott Schneeberger from Oppenheimer reiterated a Buy rating on BEST Inc (NYSE: BSTI), with a price target of $13. The company’s shares closed yesterday at $11.38.

Schneeberger observed:

“BEST delivered solid 1Q18 performance with revenue growing 54% y/y to RMB 5.004B, which exceeded our estimate/consensus/guidance of RMB 4.880B/4.867B/4.800-5.000B, respectively. Gross profit, adjusted EBITDA, and EPS also exceeded our expectations. The company generated total gross margin of 2.2% in seasonally soft 1Q18, which represented a solid y/y expansion from -4.2% in 1Q17. This was primarily driven by strong improvement in Express segment gross margin largely via reduced transportation cost per parcel and network optimization. BEST is clearly growing at a rapid pace and evidenced by its confidence in providing 2Q18 revenue guidance of RMB 7.1-7.3B (+46% to +50% y/y). Viewing the potential for adjusted EBITDA profitability by 2Q18, we’re reiterating our Outperform rating/$13 target on BEST’s continued enviable growth trajectory/profitability focus.”

According to TipRanks.com, Schneeberger is a 5-star analyst with an average return of 13.5% and a 68.8% success rate. Schneeberger covers the Services sector, focusing on stocks such as Service Corp International, Landstar System Inc, and General Finance.

BEST Inc has an analyst consensus of Moderate Buy, with a price target consensus of $13.50.

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Based on BEST Inc’s latest earnings release for the quarter ending December 31, the company reported a quarterly GAAP net loss of $20.67 million. In comparison, last year the company had a GAAP net loss of $61.37 million.

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BEST, Inc. (China) is a holding company, which engages in the smart supply chain services. It operates through the following business segments: Supply Chain Management, Express Delivery, Freight Delivery, Store, and Others. The Others segment relates to the cross-border logistic coordination services.

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