Xiaomi has gone public for a month and after a month with few surprises, analysts foresee a bright future for the Chinese firm. After debuting on the Hong Kong stock exchange, the company is now trading above its IPO price after a month of declines.
In the first few weeks no one has gotten wet but right now the two biggest companies on wall street (Goldman Sachs Group Inc. and Morgan Stanley) already recommend the purchase of their actions. Only Credit Suisse Group AG remains neutral and breaks the trend. However, they all assure that Xiaomi will raise the share price to 18.60 Hong Kong dollars or at least 9.4% more than the current price.
Xiaomi recovers little by little in the stock market
The firm has risen 2.5% in the past week and the stock has had a hard time getting past its IPO after a fateful debut. Analysts say that Xiaomi shares will rise 22% compared to last Wednesday’s price.
Why do analysts believe that Xiaomi is a value company?
To understand why Xiaomi is a safe value, we must list the keys that have taken it to where it is:
- It will increase your income and profits: Thanks to its focus on the services sector (its main market in Asia), the firm will easily be able to increase its revenues and profits. Do not forget that Xiaomi is a company that sells services, not devices (although it seems otherwise).
- It has 190 million users: and this is increasing. With the arrival in other markets outside of Asia Xiaomi does not stop gaining popularity in them. An example is its deployment in Spain, with more than 8 stores already operating in our country.
Analysts believe that Xiaomi will increase its revenue by 45% and profits by up to 60% by 2020. It is expected that the next August 22Xiaomi talk about the earnings of the past year.
It is advisable to buy their shares, but in large quantities
Therefore, if we listen to the experts in the field, now is a good time to buy Xiaomi shares. They’re a secure purchasebut it is possible that their value will take time to increase, they will not have such a brutal deployment on the stock market as other Internet companies such as Facebook or Google, which gained massive popularity in a very short time.
The Asian Entrepreneur Philosophy It is very different, although little by little it is becoming internationalized and proof of this are some sub-brands such as the recent POCO, already launched in India. Will you dare to buy their shares?
Source | Bloomberg