Xiaomi Corp Technical Analysis

Accuracy score :
97%

Xiaomi is a technology product and services company founded in early 2010 focusing mainly on smartphones and the Internet of Things products and related Internet services. An early adopter of online smartphone sales, Xiaomi used Android as its operating system but has its own customized user interface called MIUI. At the start of Q2 of 2018, Xiaomi was the world's fourth-largest smartphone manufacturer, leading in both the largest market, China, and the second-largest market, India. Xiaomi has 15,000 employees in China, India, Malaysia, Singapore and is expanding to other countries including Indonesia, the Philippines, and South Africa. Xiaomi announced that has shipped 100 million units of phones as of October 26 2018, completing its annual target more than two months ahead of its original plan. The 100 million shipment benchmark, which was set in less than 10 months in 2018, is higher than Xioami’s full-year 2017 shipments, which stood at 90 million units. However, the growth hasn’t been fast enough to help Xiaomi win back market share from rivals in China.

 

Summary (from the latest annual and quarterly  report – 2018)

  • Total equity: 10 billion USD
  • Market Cap is 34 billion USD ( the last price of the stock is 10.44 HKD)
  • Xiaomi is a technology product and services company founded in early 2010 focusing mainly on smartphones and Internet of Things products
  • The company has 2.1 billion USD in cash on account
  • Total equity – cash on account = 10 billion USD – 2.1 billion USD = 7.9 billion USD
  •  In 2018 the company had 700 million USD long-term debt, short – term debt was 1.2 billion USD                                                     (In 2016 total debt was 600 million USD)
  • The company's revenue has increased in the latest 2017 annual report  to 17 billion USD from 10 billion in 2016
  • Net loss in 2017 was 6.4 billion USD, Net income in 2016 was 82 million USD

 

Technical analysis

This stock has weakened more than 50% since July 2018 and according to the rules of technical analysis, the "bearish" trend of this stock is still very strong. The company's revenue has increased in the latest 2017 annual report but the company has operated with a net loss. For the nine months ended 30 September 2018, Xiaomi Corp revenues increased 64% and Net income totaled RMB10.14B vs. loss of RMB30.8B. As long the price of Xiaomi is below 15 HKD this stock is in the "SELL" zone. On this chart (the period from July 2018), I marked resistance and support levels. Supports level is 10 HKD, 13 and 15 HKD represent the current resistance levels. If the price jumps above 13 HKD it would be a "BUY" signal and we have the open way to 15 HKD. Rising above 15 HKD supports the continuation of the bullish trend overview efficiently for the upcoming period. On the other side, if the price breaks 10 HKD once again it would be a "SELL" signal and we have the open way to 9 and 8 HKD.

The price of stock remains weak because investors are mainly concerned about a sluggish smartphone market in China in the near future. It is also important to say that trade war concerns between the US and China has also a bad influence on this company. Xiaomi should also face up to its core problem, that is the lack of competitiveness against other local rivals, especially Huawei and vivo groups.

The Reports that you may like

Stock Title % of value Value per share 2019-02-16
(0780.HK) Tongcheng-Elong Holdings equity, debt and subsidiaries 2019-02-06
(zyne) Zyne Why too much salt is bad for your health and what to do about it ? -174.00 -3.0000 2019-02-01
(zyne) Zyne Timing
-174.00 -3.0000 2019-01-24
(zyne) Zyne Drawdown
-174.00 -3.0000 2019-01-23
(zyne) Zyne Advanced portfolio management using leverage -174.00 -3.0000 2019-01-23