Hemnet Shares Rise on New Service Despite Citi Price Cut

Key Market Movement

Hemnet Group AB (ST:HEM) shares increased by over 4% on Friday following a positive reception for its new payment service. The surge came after Citi Research highlighted strong initial demand, even as the firm reduced its price target for the stock.

Service Performance and Analyst Outlook

The Swedish property portal's "Sell First Pay Later" service showed significant traction in its first month. Data from February revealed 1,715 new listings using the service in Stockholm, constituting 45% of all new listings in the city. Despite this operational success, Citi Research cut its 12-month price target on Hemnet by 32%, from SKr180 to SKr123.

Impact on Hemnet Stock

The immediate market reaction was positive, with investor enthusiasm for the new service's adoption driving the share price up. However, the substantial price target reduction from Citi introduces a note of caution, suggesting potential valuation concerns among analysts despite the strong product launch.

Concluding Outlook

The strong uptake of the "Sell First Pay Later" service indicates successful innovation and market fit. Investors will be closely watching if this operational momentum can outweigh analyst concerns about the company's longer-term valuation.

FAQ

Q: Why did Hemnet's stock price increase?
A: The stock rose over 4% due to a report from Citi Research highlighting strong initial demand for its new "Sell First Pay Later" service.

Q: Did Citi upgrade Hemnet's stock?
A: No, despite positive comments on the new service, Citi Research actually cut its 12-month price target for Hemnet by 32% to SKr123.

Source: Investing.com