![Chinese companies go global. Morgan Stanley shares follow the trend](https://news7g.com/wp-content/uploads/2024/05/107419674-1716537618784-gettyimages-1637312305-20090101230901-99-42166-780x470.jpeg)
A U.S.-listed Chinese company that makes most of its money overseas could grow more than 75%, according to Morgan Stanley’s updated forecast. Asian equities analyst Yang Liu and team not only raised their price target on Tuya by 50 cents to $3.50 last Tuesday, but on Thursday issued a separate note for know that they expect this Chinese company’s discounted shares to “increase in absolute terms compared to the present time”. Next 60 days.” Morgan Stanley analysts said: “This is because the stock has been trading at a discount recently, making the near-term valuation much more attractive.” Tuya shares close closed Friday at $1.99, down more than 13% year to date. The company said its first-quarter revenue increased 30% year-over-year to $61.7 million. mainly from selling cloud-based “Internet of Things” software to lighting and fixtures businesses. For example, a hotel could use Tuya’s system to remotely set up interior mood lighting “The clean beat in 1Q24 reaffirmed the upward trend with a much steeper slope,” Morgan Stanley analysts said, noting that Tuya raised its revenue forecast. for the full year. “The important role for Chinese companies is to go overseas, with a global leadership position,” analysts said. “After 1Q24 results, we think Our previous OW thesis on Tuya is paying off as reflected in underlying improvements.” According to FactSet’s scorecard, more than 80% of Tuya’s revenue comes from outside China, while The growth rate of the domestic market is slowing down. Management noted that Europe is Tuya’s largest market with just over a third of total revenue, followed by Asia Pacific. Latin America accounts for nearly 15% of revenue, the company said. “Our market share is expanding as major competitors exit the market during the industry downturn from 2022 to 2023,” management said. “More and more leading brands are switching from in-house IoT development to our platform.” Tuya is just one of many China-based companies moving abroad as their business capabilities improve and growth at home slows. The company announced it became one of Google’s authorized solution providers in 2021 and said that last year it integrated Google Cloud. Regarding data security, Tuya announced last week that it had achieved the European Union’s GDPR data security certification. The company also claims to have data centers in the US, Europe, India, and mainland China. Tuya plans at its developers conference on May 29 to announce details about how it will integrate artificial general intelligence with its products. The Hong Kong dual-listed company is also rated buy by Goldman Sachs. BNY Mellon holds more than 21% of Tuya’s outstanding shares, while US venture capital firm New Enterprise Associates holds just under 20%, according to records accessed via the Wind Information database.