When environmental and health concerns arose, local media said production at the factory was suspended for investigation. If production were to be suspended for the entire duration of the investigation, it would be a major obstacle for BYD. After all, it contributed 21 percent of the cars manufactured in the first quarter.
However, the media is now quoting a worker at the factory as saying that only part of the production methods have been suspended for recycling, but the remaining production is continuing as normal. Goldman Sachs also confirmed in a study that BYD has not stopped production and thinks production will continue.
However, since the car manufacturer must meet legal requirements, the investment bank has reduced its estimated sales figures for this year from 1.6 million to 1.5 million vehicles. Despite this, BYD would still achieve its goal. Goldman reduced its revenue estimate by 12 percent to 2.58 yuan (0.37 cents) per share. However, the price target was left at $ 303 Hong Kong (37.10 euros) and the purchase proposal was also confirmed.
As a result of the allegations, the BYD stock was initially forced to accept price losses, but has now been able to recover. Basically, things are still going well for the car manufacturer and from a technical point of view it is important to note the 200-day line, which is essential for long-term trends. This is currently 254.20 Hong Kong dollars or equivalent to 31.12 euros. If taken, the stock signals a new buy signal.
Notice of Conflict of Interest:
The author has direct positions on the following financial instruments mentioned in the publication or related entities that may benefit from the price increase resulting from the publication: BYD