Shares in fintech company Wise are making a comeback this afternoon after they tumbled in London yesterday afternoon and this morning following an analysts at investment bank Citi urged clients to dump the stock yesterday.
The downgrade was driven by analysts batting away Wise’s forecasts for revenue, saying the stock now priced in “excessive long-term growth expectations”.
The analyst note triggered a selloff in Wise shares, causing them to plummet over seven per cent to their lowest ever level.
Citi’s analysts warned Wise’s share price had baked in around 20 per cent of annual compound revenue growth over the next eight years.
The rate of growth was much higher than the estimated 14 per cent for the wider London stock market.
Wise floated to great furore in London last year via a direct listing, raising £8bn and rallying 10 per cent on their first day of trading.
The listing was seen as a boost to the City as it eased concerns over fast-growing tech companies shunning the capital after Brexit.
London markets have typically been seen as underweight on tech-stocks and too heavily dominated by “old economy” stocks such as miners and oil companies.
A lack of tech-companies has led UK shared to lag behind those listed on Wall Street and the Continent.