What happened Monday was not a good day to be an investor of African e-commerce specialist Jumia Technologies (NYSE: JMIA). In the wake of a disappointing earnings report published earlier this month, one analyst at a prominent investment bank has become more bearish on the stock; his analysis helped push Jumia's share price down by almost 10% on the day. So what Analyst Luke Holbrook has taken over coverage of Jumia stock for Morgan Stanley, and he wasted little time downshifting the investment bank's recommendation. In his estimation, the stock is underweight, and investors should sell their shares at a price target of $11 per share. Previously, Morgan Stanley's recommendation was equal weight (neutral). Image source: Getty Images. Holbrook is concerned about Jumia's 2019 pivot away from relatively profitable tech goods to lower-margin -- if higher-volume -- products. This move, combined with high spending on marketing and technology, is negatively affecting the company's overall non-GAAP (adjusted) earnings before interest, taxes, depreciation, and amortization (EBITDA) margins. The prognosticator also pointed to the company's thin growth in gross merchandise value (GMV), a key metric in the e-commerce world, as a current worry. Holbrook's new take on Jumia comes less than two weeks after the company released its third-quarter results, which were not exactly met with glee by investors. The figures revealed that GMV, active customer count, and revenue all rose by around the 8% mark on a year-over-year basis. That closely watched EBITDA number was again negative, almost doubling from the year-ago quarter to over $52 million. Now what Other e-commerce companies throughout the world are delivering significantly higher growth numbers while landing squarely in the black. Jumia isn't exactly a new business, so perhaps investors are unwilling to accept single-digit improvements and/or the lack of profitability at this stage. But they shouldn't necessarily dismiss the company. According to Holbrook, the massive African e-commerce market is only 1% to 2% penetrated and as such, offers vast opportunity to early movers like Jumia. Also, it's still fairly early days for the company's pivot, and it could well succeed in the coming years. 10 stocks we like better than Jumia Technologies AG-ADRWhen our award-winning analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.* They just revealed what they believe are the ten best stocks for investors to buy right now... and Jumia Technologies AG-ADR wasn't one of them! That's right -- they think these 10 stocks are even better buys. See the 10 stocks *Stock Advisor returns as of November 10, 2021 Eric Volkman has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Jumia Technologies AG-ADR. The Motley Fool has a disclosure policy.Source