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We recently published a list of Pulse of The Market: Tuesday’s 10 Worst Performers. In this article, we are going to take a look at where VNET Group Inc. (NASDAQ:VNET) stands against other Tuesday’s worst performers.
Wall Street finished Tuesday’s trading in a lackluster fashion, with all major indices ending in the green territory, but only eking out small gains.
The tech-heavy Nasdaq rallied the most, up by 0.46 percent, followed by the S&P 500 with 0.16 percent, and the Dow Jones with a marginal 0.01 percent.
The muted trading spilled over into individual stocks, with 10 in particular posting significant losses. In this article, let’s explore the top 10 companies that performed poorly on Tuesday.
To come up with the list, we considered only the stocks with $2 billion market capitalization and $5 million in trading volume.
A close up image of a application hosting server with the company's branding on it.
VNET Group Inc. (NASDAQ:VNET)
VNET dropped its share prices by 5.67 percent on Tuesday to end at $8.48 apiece, in line with the overall muted sentiment, shunning news of better ratings from Moody’s.
On Monday, VNET earned an upgrade in VNET’s corporate family rating to B2 from B3 previously, and was given a “stable” outlook from “positive.”
Moody’s Senior Analyst Shawn Xiong said that the B2 rating was based on VNET’s strong position in China’s IDC market, its strategically located data centers with significantly expanded wholesale IDC capacity, a steady revenue growth record, diversified customer base, and established partnerships with leading cloud service providers and internet giants.
According to Xiong, VNET is expected to post solid revenues and earnings growth over the next 12 to 18 months, supported by operational synergies from strategic shareholder Shandong Hi-Speed Holdings.
Apart from Moody’s, VNET also earned better ratings from Bank of America, with a revised price target of $17.30, up from $14.50 previously. It also maintained a “buy” rating on the company.
The more optimistic outlook was based on the company’s much higher guidance on capacity delivery targets, now between 400 to 450MW as compared with the 153MW actual delivery in 2024.
Overall, VNET ranks 4th on our list of Tuesday’s worst performers. While we acknowledge the potential of VNET as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is as promising as VNET but trades at less than 5 times its earnings, check out our report about the cheapest AI stock.