Xero Ltd (XRO.AU) shares plummeted 5.27% during Thursday's intraday trading session, reflecting significant selling pressure on the Australian tech stock.
The decline comes amid broader pressure on global technology stocks as investors reassess valuations and growth prospects. Specifically for Xero, concerns have emerged regarding the company's aggressive reinvestment strategy into product development and artificial intelligence, coupled with its higher-risk expansion into the U.S. market through Melio.
Valuation analysis has added to investor uncertainty, with some models suggesting the stock may be trading above its fair value based on discounted cash flow projections. These factors combined have led to increased volatility and the sharp intraday decline observed in Xero's share price.