As we enter the second quarter of 2025, investors are looking for opportunities to capitalise on growth trends within the JSE. With a mix of established industry leaders and high-growth sectors, the market presents many potential investment prospects. This month, we highlight three shares that show strong fundamentals and promising growth potential: ADvTech, Capitec Bank Holdings, and Santam. These companies have demonstrated resilience and strategic agility in their respective industries, making them attractive considerations for investors seeking stability and upside potential in April.
ADvTech is showing strong growth, boosted by student enrollment surpassing 100 000. With double-digit increases across its schools and tertiary education divisions, the company has cemented itself as a dominant player in private education. Its ongoing expansion within South Africa and across Africa, along with a R420 million investment in a new Sandton campus, highlights its ambitious transition toward becoming a fully-fledged university.
The company reported an 8% increase in revenue and a 14% rise in operating profit, reflecting strong operational execution. Additionally, a 16% dividend boost makes ADvTech an interesting investment for those seeking exposure to the education sector’s long-term growth. Technically, the share price has been forming higher highs, and the recent pullback presents an opportunity for investors to enter the upward trend. A potential 9.90% increase could see ADH trade at R36.50.
Capitec has announced the retirement of CEO Gerrie Fourie, effective July 2025, with Graham Lee, the current Group Executive of Retail Banking, set to succeed him. This internal transition reassures investors of a strategic move, as Lee’s experience aligns with Capitec’s customer-centric and innovative banking approach.
Despite challenges posed by unsecured lending exposure, Capitec’s strong capital position and proactive risk management enhances its resilience. The bank remains a high-growth player in the financial sector, with solid fundamentals backing its long-term trajectory. The share is poised for a potential 6% gain, with price targets reaching R3 300.
Santam, South Africa’s leading short-term insurer, reported exceptional financial results in 2024, reinforcing its status as a solid defensive play. The company reported a 14% revenue increase to R47.8 billion and a 45% jump in net income to R3.68 billion, improving its profit margin from 6.1% to 7.7%.
The insurer's conventional insurance business saw a 10.5% growth in Gross Written Premium (GWP) and maintained a net underwriting margin within its target range at 7.6%. With an impressive 31.9% return on shareholders' funds and a final dividend increase of 9% to R9.85 per share, Santam offers a mix of income and growth potential. The share could see an 8.74% rise, targeting a price of R407.82.
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** This article was prepared by BROKSTOCK analyst Maboko Seabi
