BofA Securities Initiates Coverage of Tuya Inc (TUYA) at Neutral as the Leading Platform Provider for IOT

April 13, 2021 7:37 AM EDT
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Price: $17.41 -3.28%

Rating Summary:
    1 Buy, 1 Hold, 0 Sell

Rating Trend: Up Up

Today's Overall Ratings:
    Up: 38 | Down: 18 | New: 7
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BofA Securities analyst Emerson Chan initiates coverage on Tuya Inc (NYSE: TUYA) with a Neutral rating and a price target of $25.00. The company's value proposition enables OEMs and brands to transform their traditional products, such as home appliances, into software-enabled smart devices. As more brands initiate IoT initiatives, Tuya’s end-to-end solutions are utilized to address cost, time and complexity to develop IoT platforms in-house.

The analyst stated "We believe Tuya will continue to leverage China’s strong presence in OEM and capture the uptake of IoT penetration (only 4%) in the large and expanding market (US$172bn IoT PaaS TAM). We estimate revenue to post a rapid 67% CAGR in 2020-23, and rising scale to drive GPM to 50% in 2023. Our US$25 PO is based on 28.4x EV/Rev in 2022, 25% premium to the average of cloud development platform & infrastructure software peers. Our target EV/Rev implies 25% discount to peers average EV/GP/growth (taking into account GPM and growth profile), which factors in the risk of less scalable growth due to its reliance on chip/hardware."

For an analyst ratings summary and ratings history on Tuya Inc click here. For more ratings news on Tuya Inc click here.

Shares of Tuya Inc closed at $19.50 yesterday.

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