Equity analysts at Rennaissance Capital have cut their share price target for Atlas Mara. The company’s share price are tumbling and fallen by more than 10% in the last one week.
Atlas Mara is the 30% shareholder in Union Bank PLC. The company is planning to release its second quater result by next week.
Ilan Stermer, an analyst with Renaissance Capital in Johannesburg said ‘We expect Atlas Mara’s full-year profits to be down by more than 50 percent, in large part due to continued forecast weakness in the naira’. Stermer however gave the stock a buy rating.
In its Q1 2016 result, Atlas Mara’s headline revenue rose to USD51.9 million compared to USD44.3 million the company made in the same quarter last year.
Atlas Mara’s stock price has fallen by more than 40% year to date, giving it a market value of about USD220 million. The stock is down 72% since the intial public offering in 2013.
The major reason behind the company’s stock price debacle is Nigeria’s economy and depreciating currency. It will be interesting to see what Bob Diamond’s company reports next week.