a. HORIZON: 3 months
b. FROM 22-8-2024 | UNTIL 22-11-2024
c. MANAGEMENT ASSESSMENT: 20% growth
d. RECOMMENDATION: BUY
Buy Prosus (PRX) shares from the R674.53 level with a target of R809.44 for 3 months.
a. Prosus owns 24.99% of Tencent, providing investors with valuable exposure to a dominant player in China's technology sector and access to a diversified high-growth portfolio that includes gaming, social media, fintech and cloud services.
b. Prosus' core headline earnings per share (EPS) are forecasted to increase 91% to 98%, driven by strong profitability in its e-commerce businesses.
c. Newly appointed CEO Fabricio Bloisi personally bought R81.3 million worth of Prosus shares. While the stake is relatively small compared to the company's size, this move is a vote of confidence in Prosus' future and an encouraging sign for potential investors.
a. Forward P/E ratio – 12.69x
b. Dividend yield – 0.21%
c. The company’s balance sheet metrics are strong:
i.PRX has total assets of R1.17T
ii.Total equity of R785.786B
iii.Total liabilities R361.379B
1 Year EPS: 17.6%
1 Year Revenue: 11.8%
a. Heavy Reliance on Tencent: A significant portion of Prosus' value is derived from its stake in Tencent. Any negative developments in Tencent could significantly impact Prosus' share price.
b. Early-Stage Investments: A portion of Prosus' portfolio consists of early-stage companies with unproven business models, which carries higher investment risk.
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