Yandex and other Russian-based U.S. stocks crash


With the Urkaine-Russia conflict escalating into a full blown invasion, stock markets around the world were once again reeling on the news. European stocks were down, while Russia’s stock market crashed significantly. Although U.S. tech stocks fared a bit better than expected given the news headlines, it came to no one’s surprise that Russian tech stocks that are listed here in the U.S. plunged on Thursday.

The worst-performing of which includes Yandex (NASDAQ: YNDX), which is Russia’s equivalent of a Google-like search engine. While not used much here in North America, it’s the default engine for many Eastern European countries that are close to Russia. However, Yandex also has investments in a few other sectors, including ride-sharing, which are seeing significant growth right now.

Shares of Yandex fell over 54.5% following the invasion news, even though it wasn’t directly impacted. Over the past week, the company’s lost over 74.3% of its market cap. While the company’s fundamentals aren’t expected to be hurt by this Ukraine conflict, simply being known as a Russian company was enough to trigger a massive selloff amongst traders.

Some other Russian companies, including Telecom Veon (NASDAQ: VEON) and Mobile TeleSystems (MBT), were also down 24.6% and 7.4% on yesterday amidst this Russian stock selloff.

If the conflict escalates, it’s expected that this selloff will continue going into Friday. It also doesn’t help that President Biden placed additional sanctions against certain Russian companies. This includes two state banks, but also select individuals were targeted by the sanctions as well.

I’m going to begin to impose sanctions in response, far beyond the steps we and our allies and partners implemented in 2014. And if Russia goes further with this invasion, we stand prepared to go further,” said Biden on Thursday. The European Union and Britain have both imposed sanctions of their own on Russia, which are further hurting Russian-based U.S. stocks.

Before this crash began, Wall Street remained incredibly bullish on Yandex. Over 14 analysts had a “buy” rating on the company, while just a handful were neutral or bearish. However, this was well before the political crisis, which might change some of their opinions.

At the same time, the fundamentals behind the company remain unchanged. A couple weeks ago, Yandex reported its Q4 results which completely smashed consensus targets. Revenue growth was up over 54% compared to the previous year. Management expects 2022 to continue to do well, despite the threat of interest rate hikes and higher inflation.

For that reason, it’s possible that Yandex might see a surprise comeback, maybe next week. After traders get used to the scary headlines in the media, some might think that Yandex could be a potential value play at these steep discounts.


Yandex Company Profile

Yandex NV is an internet and technology company and operating internet search engines in Russia. It builds products and services powered by machine learning. The company operates through the following segments namely, Search and Portal; Taxi; Yandex.Market; Classifieds; Media Services. Search and Portal segment offers services in Russia, Belarus, Kazakhstan which generates most of the revenue. – Warrior Trading News