South African stock report - Naspers

SAFR

Naspers falls in weak trading with rising open interest April 20, 2018 17:00 SAST

NEWS BITES - AFRICA

Naspers Limited (J:NPN), South Africa's largest Media company by market cap, has decreased ZAR29.53 (1.0%) from its last trading session of April 19 to close at ZAR3,007.47. Compared with the FTSE/JSE- Africa Top 40 Index which rose 5.7 points (0.01%) in the day, the relative price change was -1.0%. The volume was 0.5 times the average daily trading volume of 1.5 million shares. The stock's open interest climbed 5.8% from 13,091 to 13,849. Combined with the price decrease, this suggests a weak stock price.

YEAR-TO-DATE

Naspers slumps 13% in 2018

Naspers Limited (J:NPN), slumped ZAR443.53 (or 12.9%) year-to-date (YTD) in 2018 to close at ZAR3,007.47. Compared with the FTSE/JSE- Africa Top 40 Index which has fallen 3.4% YTD, this is a relative price change of -9.5%.

Highlights in today's Report:

SECTION 1 BEARISH SIGNALS

Fundamentals, Overvaluation [compared with sector average], Technicals, Open Interest, Low Performance Indicators

SECTION 2 BULLISH SIGNALS

Fundamentals, Technicals, Open Interest, High Performance Indicators

SECTION 3 PRICE VOLUME DYNAMICS

Technicals, Moving Annual Return, Beta, Turnover Rate & Turnover Period

SECTION 4 RANKING

Global, Independent Ratings

SECTION 5 FINANCIALS

Financials Summary, Trailing 12 Months Dividends

SECTION 6 PROFILE

Activities, Industry & Sector, Issued Capital

SECTION 7 REPORTED BUYING AND SELLING

SECTION 8 STOCK BUZZ

SECTION 1 NASPERS BEARISH SIGNALS

1.1 Fundamentals:

+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 5. Compared with the rest of the market the stock is overvalued and ranks in the bottom 2% of stocks by value of Q Ratio.

+ As per the Du Pont analysis, Return on Equity of 18.0% is lower than sector average of 19.2%. This is computed as net profit margin of 46.0% times asset turnover [sales/assets] of 0.46 times leverage factor [total assets/shareholders' equity] of 1.5.

1.2 Overvaluation [compared with sector average]:

+ Dividend yield of 0.1% [0.2%].

1.3 Technicals:

+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 3,030.16 minus the 26-day EMA of 3,101.32 is negative 71.16 suggesting a bearish signal. Both EMA prices are falling, another bearish signal.

+ Falls to Rises: in the past month the number of falls outnumbered rises 13:8 or 1.6:1.

+ The stock's relative price strength percentile is slipping at 36 for 6 months, 16 for 3 months and 8 for 1 month.

1.4 Open Interest:

Open Interest Trend

Same day trend: The price decreased 1.0% from ZAR3,037.0 to ZAR3,007.47; Open interest has climbed 5.8% from 13,091 to 13,849. A fall in price combined with an increase in open interest suggests there is new money coming into the market from short sellers. This is a bearish signal.

DurationOpen Interest change %Price change %Interpretation
1-day5.8-1.0Weak Market
1-week21.1-0.5Weak Trend

% Change in Put Call Ratio

Put Call Ratio1 Day1 WeekInterpretation
Change %10.633.4Downtrend

1.5 Low Performance Indicators:

DescriptionValueRank In Market
Price to Sales10.9In Bottom 2%
Price Change %-1.0In Bottom Quartile

SECTION 2 NASPERS BULLISH SIGNALS

2.1 Fundamentals:

+ Total Liabilities/EBITDA of 2 is comfortably below the Joseph Piotroski benchmark of 5.

+ Interest cover defined by EBIT/I is 12 times. This indicates it is less leveraged.

+ Net profit margin has averaged 27.4% in the last 3 years. This is considered superior and suggests a high margin of safety.

2.2 Technicals:

+ The present value of ZAR1,000 (PV1000) invested one year ago in Naspers is ZAR1,215, comprising a capital gain of ZAR213 and dividend reinvested of ZAR2.

PV10001-week1-month1-year
NPN.J9958681,215
FTSE/JSE- Africa Top 40 Index1,0171,0401,110

+ The present value of ZAR1,000 (PV1000) invested five years ago in Naspers is ZAR5,176, including a capital gain of ZAR4,115 and dividend reinvested of ZAR61.

+ 5 years Multiplier in ZAR = 5.176x

+ Compound Annual Growth Rate (CAGR) in ZAR = 38.9%

Present Value of USD1,000 invested 5 years ago:

+ The present value of USD1,000 (PV1000) invested five years ago in Naspers is $US3,979, including a capital gain of $US2,932 and dividend reinvested of $US47.

+ 5 years ago USD 1 equalled ZAR 9.1996

+ 5 years Multiplier in USD = 3.979x

+ Compound Annual Growth Rate (CAGR) in USD = 31.8%

Apr 20, 2018: USD 1 equals ZAR 11.97

2.3 Open Interest:

+ Open interest hit a 12-day high.

2.4 High Performance Indicators:

DescriptionValueRank In Market
Today's TurnoverZAR2.4 billion (US$203.2 million)In Top 1%
Return on Assets [ROA] %12.8In Top Quartile
EBITDA Margin %54.6In Top Quartile

SECTION 3 PRICE VOLUME DYNAMICS

3.1 Technicals:

+ Volume: there were 808,680 shares worth ZAR2.4 billion (US$203.2 million) traded today. In the past week, volume was 0.5 times average and the shares were down 0.5%.

+ Naspers is at a discount of 27.4% to its 12-month high of ZAR4,142.99 on November 21, 2017. It is also at a premium of 23.5% to the 12-month low of ZAR2,435.79 on April 24, 2017.

3.2 Moving Annual Return

Based on a dynamic start date of 2 years ago, the Moving Annual Return has consistently exceeded 18%.

NPNClose (ZAR)Dividends (ZAR)Capital Gain %% YieldAnnual Return %
Apr 203,007.474.6421.30.221.5
1 Yr ago2,4794.4218.30.218.6

Close 2 years ago ZAR2,094.72

3.3 Beta:

+ Beta: the Beta of Naspers stock is 2.1. A Beta greater than 1 suggests this is a high risk, high return stock with volatility greater than that of the market.

3.4 Turnover Rate & Turnover Period:

+ The turnover rate in the 12 months to date was 70.7% (or a turnover period of 1 year 5 months). This average length of ownership of the stock at 0.7 times the average holding period of 2 years for stocks in the FTSE/JSE- Africa Top 40 Index suggests a slightly larger number of speculators on the share register, making it less safe for long-term investors.

SECTION 4 RANKING

4.1 Global Rank [out of 47,666 stocks] and Rank in the Middle East & Africa Region [out of 2,306 stocks]

DescriptionValueGlobal RankIn MEA Region
MCap (US$)110.2B811
Total Assets (US$)21.9B1,65766
Revenue (US$)10.2B1,38921
Net Profit (US$)2.9B3589
Return on Equity %18.05,506316
Net Profit Margin %46.02,213198
Price to Book9.832,1631,482
Yield %0.221,9371,160
PV$1000 (1Year) US$*1,3508,912408
US$* Change (1Year) %40.38,119373

* 1 year ago USD 1 = ZAR 13.35

Apr 20, 2018: USD 1 equals ZAR 11.97

4.2 Independent Ratings

+ FT 500:

Naspers Limited is the 332nd largest by revenue in the FT Global 500.

+ Newsweek 500:

It was ranked 378 by Newsweek and Corporate Knights Capital in the World's 500 Greenest Companies 2016. It had outstanding scores of 1.6% in Carbon productivity.

+ Forbes 2000:

It is the 1225th largest by revenue in the Forbes Global 2000.

+ BSS/News Bites:

It is placed 60/263 in BSS News Bites' ranking of South African performers in the past year, a percentile ranking of 77.

+ Vanguard Total World Stock ETF 7517:

The stock was one of 7517 global stocks selected by Vanguard Total World Stock ETF (VT) who bought 6,856 shares in the period Nov 30, 2017 to Jan 31, 2018 worth $US24,796,968 at an estimated Volume Weighted Average Price (VWAP) of $US3616.8273. As at Jan 31, 2018, the Vanguard Total World Stock ETF held 123,030 shares worth $US37,210,417 or 0.22% by value of the ETF's portfolio [Ranked 52 out of 7517 by value and 1 out of 116 for South Africa].

SECTION 5 NASPERS FINANCIALS

5.1 Financials Summary

Year endedMar 2017Mar 2016Mar 2015
Sales (USD B)10.27.76.6
Pretax (USD B)3.11.31.6
Net (USD)2.9B994M1.3B
EPS (USD)--3.05

Sales were up 31.8% from US$7.7 billion in 2016 to US$10.2 billion in 2017. Net profit was up 193.9% from US$994 million in 2016 to US$2.9 billion in 2017.

5.2 Trailing 12 Months Dividends

Trailing 12 Months ToValue (ZAR)
20 Apr 20184.64
20 Apr 20174.42
20 Apr 20164
20 Apr 20153.61
20 Apr 20143.27

SECTION 6 NASPERS PROFILE

6.1 Activities

Naspers operates, through its subsidiaries, in the areas of pay-television, internet, instant messaging subscriber platforms, publishing of magazines, newspapers and books and private education services. These activities are conducted in South Africa, sub-Saharan Africa, Greece, Cyprus, Brazil, Russia, China, Netherlands and USA.

6.2 Industry & Sector

Classification LevelName of Sector
Business SectorCyclical Consumer Services
Industry GroupMedia & Publishing
Economic SectorConsumer Cyclicals

6.3 Issued Capital

Based on 438,640,000 issued shares the market capitalisation is ZAR1,319.2 billion (US$110.2 billion).

SECTION 7 REPORTED BUYING AND SELLING

Insider Buying

January 18: Naspers director buys

Naspers (J:NPN) director B J van der Ross bought 1,650 shares worth ZAR60,426 ($US4,903) on January 16. The purchase price was ZAR36.62. The shares hit a 12-day high on the day.

SECTION 8 STOCK BUZZ

Corporate Wire

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March 22: Naspers Limited - Accelerated Offering Of Tencent Shares And Cautionary Announcement

Accelerated Offering of Tencent shares and Cautionary Announcement

Naspers announces its intention to sell up to 190 million Tencent Holdings Limited (Tencent) shares, equal to 2% of Tencent's total issued share capital (the Tencent Sale Shares), reducing its stake in Tencent from 33,2% to 31,2% (the Transaction).

The funds will be used to reinforce Naspers' balance sheet and will be invested over time to accelerate the growth of our classifieds, online food delivery and fintech businesses globally and to pursue other exciting growth opportunities when they arise.

The Company has not previously sold any Tencent shares since it invested in 2001.

March 22: Naspers Limited - Accelerated Offering Of Tencent Shares And Cautionary Announcement

Naspers announces its intention to sell up to 190 million Tencent Holdings Limited (Tencent) shares, equal to 2% of Tencent's total issued share capital (the Tencent Sale Shares), reducing its stake in Tencent from 33,2% to 31,2% (the Transaction).

The funds will be used to reinforce Naspers' balance sheet and will be invested over time to accelerate the growth of our classifieds, online food delivery and fintech businesses globally and to pursue other exciting growth opportunities when they arise.

The Company has not previously sold any Tencent shares since it invested in 2001.

December 19 2017: Naspers Limited - Amendments To Composition Of Board Committees

Shareholders are advised that the composition of the human resources and remuneration committee, the nomination committee and the social and ethics committee will be amended.

December 12 2017: Naspers Limited - Naspers Hosts Investor Day - 12 December 2017

Naspers Limited will be hosting an Investor Day in New York today beginning at 16:30 SA time/ 09:30 EST. Presentations will be made by executives of the underlying business segments to investors and other market participants in attendance. The proceedings will be accessible via live webcast on http://www.naspers.com/investors/investor-day (the Investor Day page).

November 30 2017: Naspers Limited - Condensed Consolidated Interim Report For The Six Months Ended 30 September 2017

Naspers delivered a solid performance for the six months to 30 September 2017 with group revenue, measured on an economic-interest basis, increasing 33% year on year to US$9.0bn (or 39% in local currency and adjusted for acquisitions and disposals). This is a 17% increase on last year's growth rate with the ecommerce businesses being key drivers of the acceleration.

Contact: (27 21) 406 2121

Physical Address: 40 Heerengracht Cape Town, 8001 South Africa

State/Province/Country: South Africa

Exchange: Johannesburg Stock Exchange (JSE)

ISIN: ZAE000015889

J:NPN; JNB:NPN; SJ:NPN; NPNJn.J

PermID: 4295888592

RIC: NPNJn.J

Source: www.BuySellSignals.com