- The stock price of Kingsoft Cloud Holdings Ltd (NASDAQ: KC) slightly fell pre-market today. This is why it happened.
The stock price of Kingsoft Cloud Holdings Ltd (NASDAQ: KC) slightly fell pre-market today. Investors are responding negatively to a bearish research report.
Goldman Sachs analyst Piyush Mubayi downgraded Kingsoft Cloud to a “Neutral” rating from a “Buy” rating with a price target of $18, which was was reduced from $37. While Mubayi stays constructive on China’s cloud market – which is expected to grow at 37% CAGR in 2020-2025 as per CAICT – he is expecting that Kingsoft Cloud, which accounted for 4.8% of China’s IaaS+PaaS public cloud market in the first half of 2021 will see slower public cloud revenue growth of 23%/27%/24% in 2021/2022/2023.
Mubayi wrote that this is partially offset by multi-cloud adoption trends and Kingsoft’s industry neutrality. And Mubayi cut Kingsoft’s organic enterprise cloud revenue growth to 66%/57%/80% in 2021/2022/2023 due to the negative impact from COVID resurgence on project deployment, and slower traditional enterprises’ digitalization.
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