Tagged: basic

The fluctuation of Chinese technology shares is not related to the basic plane

Citigroup said in a report that the recent volatility of Chinese technology companies’ U.S. listed stocks has nothing to do with their fundamentals and has created greater buying opportunities for investors.

 

The bank reiterated its buy rating on Baidu (208.61, 4.04, 1.97%), Tencent music (20.1, -0.26, -1.28%) and vipshop (31.19, -0.76, -2.38%), saying the shares of these companies were “unfortunately misplaced”.

 

Citigroup analysts led by Alicia Yap wrote in the report: “although we are not sure whether the drastic fluctuations in the share prices of many technology stocks in the past few days will lead to more forced selling pressure or de risk selling sentiment of other funds in the next few days, we do believe that this selling has nothing to do with fundamentals.”

 

Gary Dugan, CEO of the global CIO office in Singapore, echoed Citigroup’s view of the volatility of Chinese technology stocks.

 

“We think the sell-off is technical and exaggerated, so it’s a long-term buying opportunity,” he said

 

Tencent music’s U.S. listed shares have fallen 37% in the past three trading days after it announced a $1 billion share buyback plan on Monday. As for Baidu, Citigroup analysts pointed out in the report that the company has about $2.78 billion in outstanding stock repurchase plan, which can be used to repurchase shares. “Baidu’s growth prospects are still optimistic,” they said.