Down 13% in a month, fundie says Xero share price is ‘very reasonable’

A florist gets some good news on his laptop and tablet, a big smile on his face as he is surrounded by flowers.A florist gets some good news on his laptop and tablet, a big smile on his face as he is surrounded by flowers.

It’s been a pretty paltry month or so for the Xero Limited (ASX: XRO) share price, no way around it. Xero shares were going for $95.20 back on 5 May. Today, the online accounting software provider is asking just $82.20 a share at the time of writing.

Not only is that down a nasty 2.58% for the day thus far, but it also means Xero has lost more than 13% since 5 May.

But this is arguably just an extension of the pretty bleak year Xero has suffered through so far in 2022. Since the start of the year, the Xero share price is down by 44%.

So now that we’ve seen such a steep fall in the value of Xero shares, many investors might be wondering whether this is turning into a buying opportunity for this ASX tech share. So let’s see what the experts reckon.

Is the Xero share price a buy today?

One ASX broker who likes the look of Xero right now is Goldman Sachs. As we covered a few days ago, Goldman has maintained a buy rating on Xero shares, together with a 12-month share price target of $118.00. Goldman liked what it saw in Xero’s recent earnings report, and expects another strong increase in revenues in FY 2023 to almost NZ$1.4 billion.

But Goldman isn’t the only investor expecting big things from Xero. My Fool colleague Tony chatted to Tribeca Investment Partners’ Jun Bei Liu this week. Here’s some of what she said about Xero:

We love this company because, for many years, it’s demonstrated its execution in dislodging incumbents and growing its share and became a dominant player across the New Zealand, Australian markets. And now it’s gone to the UK. It’s demonstrated it’s gaining [market] share really well.

Share price, again, [is] being punished because of people rotating out of growth stocks into others. And I think the current share price is [at] very reasonable levels. It’s not something you buy for next month’s earnings. It is something you buy for the bottom drawer, for the longer term, for the next five years.

So we love Xero.

So that’s how two ASX investing experts view the Xero share price right now. They seem to be fairly unanimous on this tech company’s rosy future. But we shall have to wait and see how right they are.

In the meantime, the current Xero share price gives this ASX 200 tech share a market capitalisation of $12.44 billion.

The post Down 13% in a month, fundie says Xero share price is ‘very reasonable’ appeared first on The Motley Fool Australia.

Should you invest $1,000 in Xero right now?

Before you consider Xero, you’ll want to hear this.

Motley Fool Investing expert Scott Phillips just revealed what he believes are the 5 best stocks for investors to buy right now… and Xero wasn’t one of them.

The online investing service he’s run for over a decade, Motley Fool Share Advisor, has provided thousands of paying members with stock picks that have doubled, tripled or even more.* And right now, Scott thinks there are 5 stocks that are better buys.

*Returns as of January 13th 2022

More reading

Motley Fool contributor Sebastian Bowen has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has positions in and has recommended Goldman Sachs and Xero. The Motley Fool Australia has positions in and has recommended Xero. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

from The Motley Fool Australia

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