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Our opinion on the current state of LHCLife Healthcare, as the second-largest healthcare company listed on the Johannesburg Stock Exchange (JSE), operates an extensive network of private hospitals, same-day clinics, surgeries, and healthcare companies across South Africa, the UK (through Alliance Medical), and Western Europe. The company's strategic direction, as outlined by outgoing CEO Shrey Viranna, focuses on diversifying from traditional hospital care towards day-clinics and non-acute services, alongside broadening its customer base beyond medical aid beneficiaries to include individuals paying out-of-pocket for medical services. Initiatives like the MyLife Clinic, offering consultations and basic medication for R300, exemplify this shift. For the fiscal year ending 30th September 2023, Life Healthcare reported a 10.3% increase in revenue, although headline earnings per share (HEPS) saw a decline of 16.9%. The company attributed the robust demand for its services in South Africa to its status as the preferred network provider for medical aids, leading to increased hospital and complementary service utilization. A significant development was the trading statement for the six months ending 31st March 2024, projecting an earnings per share increase of over 20% following the disposal of Alliance Medical Group. This disposal is expected to impact earnings per share positively but will not influence HEPS. From a technical analysis perspective, the share experienced its peak at R47 in September 2014, subsequently entering a prolonged downtrend and currently trading around 1791c with a price-to-earnings (P:E) ratio of 20.31. This valuation mirrors investor expectations for improved results, the company's defensive market position, and its international diversification, offering some protection against rand volatility. Despite the sideways trend in its share price, Life Healthcare's decision to resume dividend payments, combined with its strategic acquisitions, such as the planned acquisition of 51 clinics in South Africa, Eswatini, and Namibia as reported by Business Day on 19th May 2023, positions it as a potentially valuable investment. These moves indicate the company's commitment to expansion and adaptation in a changing healthcare landscape, making Life Healthcare a consideration for investors seeking exposure to the healthcare sector with a diversified and evolving operational model.
JSE:LHC
by PDSnetSA
Our opinion on the current state of ITEItaltile, controlled by the Ravazotti family, is a prominent franchisor of tiles, sanitary ware, flooring, and home finishing products, with a unique business model that encompasses manufacturing and wholesaling its products. The company boasts 206 stores and 6 online web stores, alongside a substantial property portfolio valued at approximately R4.3 billion. Italtile's strategic acquisitions of Ceramic Industries and Ezee Tile have solidified its position in the manufacturing sector, complementing its robust retail operations. The company has witnessed an uptick in sales, attributed to the increased trend of working from home and consumers' desire to enhance their living spaces. Italtile's commitment to expansion is evident in its plans to open 10 to 15 new stores within the year, alongside a strategic move to repurchase around R240 million of its own shares. However, the civil unrest and the COVID-19 pandemic have posed challenges, leading to temporary store closures and the destruction of two outlets. For the six-month period ending on 31st December 2023, Italtile reported a slight 2% decline in turnover and a 15% decrease in headline earnings per share (HEPS), although its net asset value (NAV) experienced a 10% increase to 684.4 cents per share. Despite these challenges, the company has maintained a financially robust retail operation, supported by a strong balance sheet and significant cash reserves, which have doubled from R0.8 billion in 2022 to R1.5 billion. The share price trajectory of Italtile has experienced fluctuations, with a notable downturn during the COVID-19 pandemic to levels around R10, followed by a period of sideways and downward movement. Currently trading at approximately 1090 cents per share with a price-to-earnings (P:E) ratio of 8.24, Italtile presents a compelling buying opportunity for investors. However, prospective investors are advised to exercise patience and monitor the share's performance for a breakout above the current downward trendline before committing to purchase, to ensure entry at a potentially more favorable market position.
JSE:ITE
by PDSnetSA
Our opinion on the current state of CPRCopper 360, a company engaged in processing historical copper rock dumps and mining surface and shallow copper resources, outlines its operation with a dual focus on environmental cleanup and resource extraction. The company has secured a comprehensive database from industry giants like Newmont and Gold Fields, who previously operated in the district, to bolster its operations. For the fiscal year ending on 31st August 2023, Copper 360 reported a significant reduction in its loss to R4.9 million from R31.6 million in the prior period. This improvement is attributed to increased production and the completion of capital expenditure phases. The acquisition of Nama Copper Resources Proprietary Limited ("Nama Copper") is a strategic move anticipated to enhance production capabilities and reduce execution build and delivery risks. Copper 360 aims for an EBITDA exceeding R650 million by the fiscal year 2025, alongside major resource upgrades to bolster mining flexibility and growth. On 21st December 2023, the company successfully raised R274 million to fund the acquisition of Nama Copper and support production growth at the Rietberg mine. Despite these developments, the company's share performance since its listing on 12th April 2023, closing at 500c and subsequently declining to 371c, suggests market skepticism. This downward trend raises concerns about the company's market valuation and investor confidence. Given these dynamics, Copper 360 represents a potentially high-risk investment option within the volatile commodities sector. The company's focus on copper, a critical industrial metal with fluctuating prices, adds to the speculative nature of this investment. Potential investors are advised to exercise caution and monitor the company's share price stability and operational progress before committing to an investment. The company's ability to secure additional funding, as evidenced by the R100 million raised through share sales on 19th February 2023, indicates ongoing efforts to finance its strategic objectives and operational expansion.
C
by PDSnetSA
Our opinion on the current state of AMSAnglo American Platinum (Amplats), recognized as the second-largest platinum producer globally, falls under the substantial ownership of Anglo American with a 77.62% stake. The company has been at the forefront of transforming platinum mining in South Africa, shifting from deep-level mining to shallower, more mechanized operations. This strategic pivot has significantly reduced the number of mines from 18 to 7 over the last five years, alongside a 50% reduction in both overheads and workforce, enhancing efficiency and profitability. Amplats' Mogalakwena operation, known for its palladium-rich deposits, operates within the lowest cost quartile of the platinum group metals (PGM) industry worldwide. The company's investment in expanding this mine is expected to significantly increase platinum and palladium production. Furthermore, Amplats' acquisition of Glencore's stake in the Mototolo joint venture and the adjacent Der Brochen property underscores its commitment to growth and operational optimization. Despite the advancements and strategic operations, the platinum industry faces challenges from an effective recycling industry that recovers approximately 2 million ounces annually from old auto catalysts. These dynamics contribute to the volatility and unpredictability of PGM shares, with Amplats being no exception. Recent developments include plans to relocate 1,000 families to facilitate production expansion at Mogalakwena, the extension of the life of the Mototolo/De Brochen mines, and the resignation of CEO Natascha Viljoen, set to serve a 12-month notice period. For the year ending on 31st December 2023, Amplats reported a slight decrease in refined PGM production and a significant drop in the rand basket price per ounce, leading to a 24% reduction in revenue and a 71% fall in HEPS. These results reflect the broader challenges facing the industry, including Eskom load curtailment and declining PGM prices. Given the speculative nature of investments in PGM shares due to fluctuations in international metal prices and industry challenges such as load shedding, potential investors are advised to exercise caution. The recommendation is to wait for a clear upward trend before considering investment, especially in light of the share's performance decline since March 2022 and the recent announcement regarding potential employee retrenchments.
JSE:AMS
by PDSnetSA
Our opinion on the current state of 4SI4Sight Holdings, based in Mauritius, focuses on investments in companies and technologies pivotal to the Fourth Industrial Revolution, emphasizing cyber-physical systems such as cloud computing and the Internet of Things (IoT), evident in the rise of "smart factories." The company operates across two main segments: mining & manufacturing and software, cloud, and enterprise solutions. With a workforce of 400 and serving 3,000 customers across 30 countries, 4Sight has a significant portion of its income, 42%, originating from outside South Africa. Since its initial public offering in October 2017, the company's share price has experienced volatility, dropping from 235c to around 13c by September 2019 before rallying to 31c. Despite not offering dividends, 4Sight has demonstrated substantial growth potential, particularly in a niche as complex and forward-looking as the Fourth Industrial Revolution. The company's strategy includes a rigorous stop-loss policy for investors, acknowledging the challenges in evaluating such a specialized entity without in-depth knowledge of its technological focus. Significant developments include the repurchase of 30.6% of its issued ordinary shares and the sale of Digitata for just over R90 million on 6th October 2020. For the fiscal year ending on 31st December 2023, 4Sight reported a 34.9% increase in revenue and a 127.8% rise in headline earnings per share (HEPS), attributing the growth partly to foreign exchange gains and an increase in operating expenses. The share was added to the Winning Shares List on 3rd August 2023 at 31c and has since appreciated to 96c, marking a 209% gain in six months. Despite being categorized as a penny stock with an average daily trading volume of about R230,000, making it accessible to private investors, 4Sight has demonstrated a robust uptrend following its latest financial results. However, this uptrend may be plateauing, suggesting a potential shift in its market trajectory.
4
by PDSnetSA
Cashbuild Showing Signs of Trend ReversalCashbuild is in pursuit of a weekly and yearly low price, here we see price finding support at the 0.382 line of the Pitchfork bouncing off it. In the process it has created hidden divergence on the TSI & RSI indicators. We can open a long position when price closes above the 10 week moving average, more risk accepting investors can go long on weekly swing low. Ideal to harvest some profits when we reach the resistance of the Pitchfork but we will be assessing these moves on a daily chart timeframe.
JSE:CSBLong
by runyamhere
SOL'Distance Divergence'. Similar to the traditional bullish or bearish divergence used when looking at a MACD, RSI or Stochastic, the 'distance divergence' is where the indicator (price distance vs moving average) develops a lower high or higher low vs the price. At current levels, Sasol (SOL) is printing a lower low however, the distance vs the 75-day EMA (i.e. the 50/100-EMA spread) is developing a higher low high, which may be a precursor to potential upside and an opportunity to take a buy/long position.
JSE:SOLLong
by techpers
Our opinion on the current state of CGNCognition Holdings operates as a conglomerate specializing in agency-based payment systems, fax to email services, knowledge creation, and management. The company positions itself as a multi-disciplinary entity that provides a wide array of services to the Fast Moving Consumer Goods (FMCG) sector, media, and digital agencies. For the six-month period ending on 31st December 2023, Cognition reported a decrease in revenue by 8.6% but saw a significant increase in headline earnings per share (HEPS) by 272.7%. Additionally, the company's net asset value (NAV) experienced a 4% increase, reaching 104.98 cents per share. The decline in revenue was noted specifically in the Campaign Management and Research and Insights divisions, whereas the Channel Incentive unit saw a notable recovery when compared to the same period in the previous year. This recovery was attributed to a strategic shift in the services offered to clients, moving away from traditional channel incentives towards more innovative solutions. Despite these financial results and strategic shifts within its business units, Cognition faces a notable challenge related to its share liquidity. The average daily trading volume of approximately R10,000 renders the share highly illiquid, making it a challenging investment for private investors seeking practical entry and exit points in the market. This low trading volume could significantly impact investors' ability to buy or sell shares without affecting the market price, thereby limiting its attractiveness as an investment option despite the company's operational achievements and strategic realignments.
C
by PDSnetSA
Our opinion on the current state of AEGAveng, once a towering presence in the construction sector, experienced a dramatic decline, transforming from a stock valued at R69 a share in 2008 to a penny stock. This downturn was influenced by several critical factors, including reduced construction spending following the sub-prime crisis and the subsequent cessation of government infrastructure development post-2010 World Cup. Further exacerbating the company's challenges were the R1.4 billion fines levied by the competition commission on the construction industry and significant losses on various construction contracts necessitating considerable write-downs and impairments. In a strategic pivot, Aveng focused on bolstering its profitable entities, McConnell Dowell in Australia and the mining contractor Moolmans, steering the company towards a more sustainable path. A pivotal moment in its restructuring efforts was the announcement on 26th January 2021 of a fully underwritten rights issue aimed at raising R300 million by issuing approximately 20 billion shares at 1.5c each, resulting in substantial dilution for existing shareholders. On 12th October 2021, Aveng undertook a 500-for-1 share consolidation, which saw its share price adjust to around R28, marking a significant restructuring of its share capital. The sale of Trident Steel for R1.2 billion, announced on 3rd May 2023, significantly bolstered the company's financial position, rendering it effectively debt-free. For the fiscal year ending on 30th June 2023, Aveng reported a 28% increase in revenue but acknowledged a "disappointing operational performance," culminating in a headline loss per share of 753c, a stark contrast to the profit of 252c reported in the previous year. The trading statement for the six months ending on 31st December 2023, however, projected an increase in headline earnings per share (HEPS) of between 65.4% and 75%, signaling a potential turnaround in its financial health. In a strategic move reflecting its operational focus, Aveng announced its decision to switch its reporting currency to Australian dollars, given that 91% of its income is now generated in that currency. Despite these efforts, the company's share price has continued to experience downward pressure. Investors are advised to exercise caution and consider waiting for a decisive upward breach of the long-term downward trendline before committing to the stock, indicating a potential shift in investor sentiment and the company's market performance.
JSE:AEG
by PDSnetSA
UPDATE: Will be get our long awaited breakout yet?Sun International has been a roller coaster of a ride. Been swinging between R38.00 and R42,50. Well, lately we've seen higher lows, and the price keeps touching the top. It's like hitting thin ice. Eventually it'll break up and out. So, let's see what it does. UPDATE: Over the past year, the most notable insider purchase was made by CEO & Executive Director Anthony Leeming, who bought shares valued at R2.2 million, priced around R36.42 each. While insider purchases are generally a positive sign, it's important to note that this significant buy was made at a price considerably lower than the current price of R41.70. This lower purchase price suggests that it may not provide much insight into whether insiders currently see the stock as a good value. During the last year, insiders at Sun International have been buying shares but haven't sold any. The insider transactions for the past year, including purchases by both companies and individuals, are illustrated in the provided chart. For detailed information on the transactions, including specifics on who sold shares, the sale amounts, and the timing, you're encouraged to check the chart directly.
JSE:SUILong
by Timonrosso
Aveng W Formation nearly time for a Breakout at R11.25We see a W Formation, with the price moving and completing the right Double Bottom. Once we get a breakout to the upside, we could see major upside to R11.25. Right now and it's a wait and see but the fundamentals look good. UPDATE: On February 16, 2024, the company announced an expected 45% increase in revenue for the six months ending December 31, 2023. This good news reflects the strong performance of Aveng and its significant progress through its divisions, McConnell Dowell and Moolmans. Following this announcement, Aveng's stock price jumped by nearly 15%, showing that investors are really optimistic about the company's future.
JSE:AEGLong
by Timonrosso
UPDATE: Merafe entered into a sideways Twilight Zone What's nextWe see Merafe has definitely entered into a Rectangle formation. Price is remaining above the 200MA where it could range between the high and low. We definitely need a breakout to the upside, before we see upside. The target potential will be at R1.61 if the price breaks above the Rectangle. Now I wouldn't be that positive and optimistic with this analysis, due to the bad numbers released with ferrochrome. UPDATE: In a strategic move that echoed the prevailing market conditions, Merafe Resources, the South African ferrochrome producer, reported a considerable drop in production for the year. The company's attributable ferrochrome production fell by a substantial 22% from 384 kilotons in the preceding year to 300 kilotons. This planned reduction in output was primarily driven by the high electricity demand during the winter season, characterised by escalated power prices. As a result, the Lion smelter was the only operational facility during this period.
JSE:MRF
by Timonrosso
UPDATE: Transaction Capital heading up to target 2 - R11.53Transaction Capital has been the come back duck since October. It's reached the first target of R6.88 in December. It then moved in a consolidation sideways pattern that formed a W Pattern. Since it broke above the neckline, the momentum has been on fire. This is just an update that the price is on its way to the next target at R11.53. UPDATE: Transaction Capital aims to generate between R900 million and R1.25 billion through the sale and issuance of shares in WeBuyCars. Preceding the proposed separation and independent listing of the successful second-hand car dealership. The strategy includes offering new shares to the asset manager Coronation, along with the issuance of additional shares for acquisition by new investors, which will result in a reduction of Transaction Capital's stake in WeBuyCars from 74.9% to a range of 57% to 67%.
JSE:TCPLong
by Timonrosso
$JSEMNP - Mondi: Triangle Outlook Invalidated, Now It's ComplexSee link below for previous update. After a 19 month sideways consolidation, which I had labelled as a wave 4 triangle, the bulls came out of nowhere and took price beyond the 33900 zone, which was key resistance, to around 37000 cps. This swift move from October invalidated the entire five wave impulse outlook from the all time high at 43005. The technical structure now looks complex and will require some time to get more clarity. I will sit on my hands on this one until such time.
JSE:MNP
by Loyiso_BlaqueSoros_Mpeta
$JSEBAW - Barloworld: New 52 Week Low, How Much Lower Can It Go?See link below for previous analysis. Barloworld released a voluntary trading update for the first four months of FY'24 yesterday. Salient points: -5% reduction in group revenue due to reduced sales volumes in some businesses, following a slowdown in the mining sector, continued geopolitical conflicts and reduction in consumer demand in its consumer industries vertical. There was mixed performance across the operations so the fundamental picture is still concerning. Technically, there is no change in the wave count. I am still viewing the stock as currently trading lower in wave wave of C. As to how much lower the share can go is anyone's guess but downside momentum is weak with strong convergence between price and the MACD indicator.
JSE:BAW
by Loyiso_BlaqueSoros_Mpeta