Volatile Xero drops on loss news
Tech company Xero has plunged a day after it announced a doubling of its half-year net loss.
It also wiped more than $30 million off the company's value, with the market capitalisation now standing at $638 million.
The company's shares started the year at $2.76.
Hamilton Hindin Greene director Grant Williamson says the larger loss announced yesterday was expected and weak offshore markets might have also hastened Xero's decline, as investors sell out of risky stocks.
"Stocks that have performed the best normally do come under a bit of pressure as soon as the international markets start to weaken.
"It's not anything out of the ordinary, and if Wall Street picks up tonight, we'll probably see Xero pick back up again."
Mr Williamson says Xero gained 8.6% on Monday and last Thursday it was up 6.4%, while on one day in August it had a 5.9% drop.
"It is quite a volatile stock on the upside and the downside."
Xero ceo Rod Drury told NBR ONLINE yesterday the company is "absolutely in the growth phase" and its investments will drive a profitable business in the long term.