Many big-name S&P/ASX 200 Index (ASX: XJO) shares have fallen in the last week, but Xero Limited (ASX: XRO) shares have bucked the trend.
Xero (ASX: XRO) shares have soared 11.29% from $78.62 at market close Wednesday 8 March to $87.50 at last look today.
In comparison, the benchmark ASX 200 index has slid 3.75% in the same time frame.
Let's take a look at how much I would have now if I had invested $5,000 in Xero shares a week ago.
How much would I make?
A week ago, Xero shares were fetching $78.62. This means if I had invested $5,000 into Xero at this price, I would have received 63 shares with $46.94 in cash left over.
Now, with Xero shares trading at $87.50, these shares would be worth $5,512.5. This means, my investment in Xero would have delivered more than $500 in gains in just a week.
Xero revealed this week that it had "no material exposure" to the Silicon Valley Bank (SVB) collapse. As my Foolish colleague James reported, Xero's total exposure to SVB was about US$5 million, which represents less than 1% of Xero's cash and cash equivalents as of 30 September 2022.
Meanwhile, on 9 March, Xero revealed it will cut staff by 700 to 800 globally to reduce costs and drive growth. This is designed to improve Xero's operating profit.
Commenting on this news, CEO Sukhinder Singh Cassidy said:
We have made strong progress in executing our strategy. However as we aspire to build a higher performing global SaaS company and to enable Xeroʼs next phase of growth and drive better customer outcomes, we need to streamline and simplify our organisation.
The team at Morgans has recently placed an "add" rating on Xero shares with a $97 price target. This implies an upside of nearly 11% based on the current share price.
Morgans described Xero as a "high quality cash generative business" with "impressive customer advocacy and duration". The broker added:
Over the last 12 months rising interest rates and competition have made things harder for Xero.
However, we see the current short term weakness as a rare opportunity to buy a high quality global growth company at a discount to the life time value of its current customer base.
Xero share price snapshot
Xero shares have slid 6% in the last year. However, in the past month, they have climbed 11.41%.
For perspective, the ASX 200 has shed 0.77% in the last 52 weeks.
Xero has a market capitalisation of about $13.1 billion based on the current share price.
