Xiaomi’s stock price hits a new all time high – Idaho Reporter

Asia, Technology

Xiaomi’s stock price hits a new all time high

On January 4, the first trading day of 2021, the share price of Xiaomi Group touched a new record high, reaching $HKD 35.25 per share on the closing bell, with a market cap of up to $HKD 880 billion..

  Just 2 years ago Xiaomi landed on the Hong Kong Stock Exchange. On the day of the celebration banquet, Lei Jun, founder and CEO of Xiaomi, made a bold statement: “We want investors who bought on the first day of listing to double their profits.” The stock price has been hovering below 10 dollars for a long time, lower than the issue price of $HKD14.

  But in August 2020, the situation was reversed, and Xiaomi’s stock price bounced back and went from zero to hero in the matter of 6 months.

  Xiaomi’s profitability has always been questioned. Although the shipment of mobile phones is very high, the problem of low-end and low-price is always unavoidable. In 2018, Xiaomi turned losses into profits, but its net profit margin was only 7.7%. In the first quarter of 2019, it was still 7.28%. The gross profit margin of Xiaomi’s business has been maintained at 11%-13% since 2017. The best-selling products such as mobile phones have not made Xiaomi a considerable profit.

  ”After ten years of work, everyone thinks that Xiaomi is still low-end, and I am very depressed.” In order to change the public’s impression of Xiaomi’s “low-end, OEM and no technology”, Lei Jun decided to focus on the mid-to-high-end product line . This change started with Xiaomi Mi 10.

  In 2019, Xiaomi’s overall gross profit margin increased by 1.2%, from 12.7% in 2018 to 13.9%. In the third quarter of 2020, Xiaomi’s market share returned to the top three in the world, accounting for 13.5% of all mobile phone deliveries. The average selling price of Xiaomi’s products continued to rise, a year-on-year increase of 14.7%.

  The hot sale of Xiaomi Mi 11 has become another high-end series “explosive model” after Xiaomi Mi 10 series, further consolidating the position of the Xiaomi brand in the high-end market.

  Earlier, Industrial Securities raised the target price of Xiaomi to 37.3 Hong Kong dollars and maintained its BUY rating.

2 Comments

  1. petrosmt

    Hello Robert. Nice to see another article on Xiaomi from you. You said you where underwhelmed by the last quarter resorts. Are you still bulish on the company or have you changed your mind on it?

    • Robert K. Reed

      I think first quarter 2021 results will be better (both revenue and net profit). This means that price can go towards $HKD50 but we may see profit taking and another setback. Everything is possible now. Their phones are great and better priced than all other brands, I know that much…

Leave a Reply to Robert K. Reed Cancel reply

Theme by Anders Norén

%d bloggers like this: