Benzinga - Investors who bought stocks during the COVID-19 market crash in 2020 have generally experienced some big gains in the past two years. But there is no question some big-name stocks performed better than others since the pandemic bottom.
Sony's Bumpy Ride: One company that has been a solid performer in the past two years has been the Japanese consumer electronics conglomerate Sony Group Corp (NYSE: SONY).
Like many other industries, the movie industry and consumer electronics industry were initially hit hard by the COVID-19 pandemic in 2020. But as global economies started to open back up in 2021, Sony’s semiconductor business is now struggling with a global chip shortage.
Sony’s diversification also came up big during the pandemic. The company’s gaming, music and financial divisions all thrived during global economic shutdowns. The company even launched its highly anticipated PlayStation 5 gaming console in November 2020.
Sony’s gaming and network services division was its largest division in fiscal 2020, accounting for about 30% of total revenue. Financial services was a distant second at 19%, followed by image sensing and solutions (semiconductors) at 12%.
In the most recent quarter, Sony’s reported 16% revenue growth and said its hardware division is generating higher profits thanks to price hikes and cost cuts. In addition, the company said video game demand has been high, but engagement is down from a year ago.
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At the beginning of 2020, Sony shares were trading at just $68.30. By the beginning of March, the stock was down to $63.60 as news of the coronavirus spreading in China prompted concerns about a U.S. pandemic.
When the market crashed during the U.S. COVID-19 outbreak, Sony shares dropped as low as $50.94 on March 16, 2020, during the height of the pandemic fears.
When the market bounced in late March 2020, Sony began to rebound as well. In fact, the stock made it back up to pre-pandemic highs above $74 by July.
Sony hit $84.14 in August before a broad tech stock sell-off dragged it back down to as low as $72.45 in October 2020. At that point, the rally resumed ahead of the PlayStation 5 launch. Sony finished 2020 above $100.
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Sony In 2021, 2022, Beyond: Sony shares hit new highs of $118.50 in February 2021 before spending the next eight months consolidating in a broad trading range of around $95 and $115. In early November 2021, Sony finally broke out to new highs, ultimately making it to a post-pandemic high of $133.75 in January 2022.
A 2022 sell-off in tech stocks dragged Sony shares back down to as low as $61.72 in October 2022 before the stock rebounded to around $79.20 today.
Investors who bought Sony on the day it hit its 2020 pandemic low and held on have generated a decent return on their investment. In fact, $1,000 in Sony stock bought on March 16, 2020, would be worth about $1,570 today.
Looking ahead, analysts are expecting Sony's stock to continue to rise in the next 12 months. The average price target among the 20 analysts covering the stock is $103.91, suggesting a 31% upside from current levels.
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