Sony Group Share Forecast January 2022 – Time to Buy SONY?
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Shares of multinational media conglomerate Sony Group (NYSE: SONY) are in the red today, after closing at $111.63 as of January 21st (19:53 EST). Sony Group has been focusing on its metaverse and electronic vehicle operations for long-term growth. While sales have surged in recent quarters, Sony Group’s profits remain at a downtrend.
Sony Group – Technical Analysis
Sony Group’s financial statement indicates a market cap of $141.285 billion with total assets worth $256.929 billion. Revenue for 2020 was at $85.87 billion with a profit margin of 12.87% compared to $75.77 billion in 2019.
Moving averages such as Exponential Moving Average (10)(118.30), Simple Moving Average (10)(120.17), Exponential Moving Average (20)(120.86), Simple Moving Average (20)(123.29) and Exponential Moving Average (30)(121.50) are indicating a sell action.
On the other hand, oscillators such as Williams Percent Range (14)(−93.22), Bull Bear Power(−15.74)and Ultimate Oscillator (7, 14, 28)(30.85) are neutral.
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Recent Developments
Sony has been a household name for several decades now. Sony operates as one of the world’s largest manufacturers of consumer and professional electronic products, as well as the largest video game console company and the largest video game publisher. It is a leader in several different industries, including music and movie production, audio recording technology, consumer electronics, video games and consoles, and digital media-focused semiconductors. It has produced signature products over the years, such as Walkman portable audio players, Trinitron TV sets, PlayStation gaming consoles, and the Blu-ray optical storage standard.
Sony Group is coming back from the pandemic slowdown in a strong way. It has reported an increase of annualised sales by 27% in five years and 16% over the last 18 months. The company has made recent in rows into the electric vehicle development market as well and has launched the PlayStation VR2 virtual reality headset. However, not all is sunny in Sony’s headquarters, as the company also reported a decrease in free cash flow of 35%. Earnings and cash balances have also trended downwards in recent quarters.
Recently, Microsoft launched a buyout bid for leading video game producer Activision Blizzard. This sent Sony shares downward as investors feared Microsoft might remove popular Activision gaming franchises from the PlayStation platform. Sony has been helped by the PS5, whose subscription service provides more incentive for PS4 owners to stay within the PlayStation ecosystem when upgrading. PS Plus members have increased from 5.8 million in fiscal 2013 to 47.2 million through the most recent quarter. Sony will launch a new service code named Spartacus in the near future. It is aimed at merging PS Plus and PS Now into one service.
Should You Buy SONY Shares?
Investors interested in Sony Group have several reasons to be optimistic about the company’s long-term future. But they have equal reasons to worry about the company’s immediate future. Sony is still a potential growth stock with enormous branding power, which can tackle any short-term business challenges. Thus the recent sell-off after the Activision news may present a good buying opportunity.
Sony’s bottom-line profits and cash flows have worried investors. Its efforts in the electric vehicle and virtual reality markets have potential in the long run. But it will not contribute profits in the immediate future. Many analysts expect Sony’s stalled profits to increase again which will provide a solid long-term play on the media market. Based on this, now is a good time to add SONY shares to your portfolio.
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