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Investing.com - RBC Capital raised its price target on Jumia Technologies (NYSE:JMIA) to $6.50 from $5.00 on Monday, maintaining a Sector Perform rating on the African e-commerce company. The stock has shown remarkable momentum, delivering a 50% return over the past six months and currently trading near $6.67.
The price target increase follows Jumia’s second-quarter financial results, which showed improvement and included raised guidance that suggests a potentially faster path to profitability. According to InvestingPro data, while the company maintains a strong balance sheet with more cash than debt, analysts don’t expect profitability this year.
RBC Capital noted that physical order growth improved modestly and appears positioned to accelerate further, while currency stabilization across most of Jumia’s geographic markets has become both a transactional and translational tailwind.
The firm highlighted that Jumia’s raised top-line outlook should give investors more confidence in the company’s roadmap toward reaching breakeven on a pre-tax profit basis by the end of 2026.
RBC Capital’s new price target is based on 2.7x enterprise value to estimated 2026 revenue, up from the previous multiple of 2.4x, with the firm describing Jumia as "looking increasingly intriguing" and suggesting the company is in a "much better place than 6 months ago."
In other recent news, Jumia has partnered with Mirakl to enhance its advertising capabilities. The collaboration involves the deployment of Mirakl Ads, a retail media solution designed for both first-party and third-party sellers. This initiative has been rolled out across Jumia’s operations in nine African countries, including Ghana, Nigeria, Kenya, and Egypt. Additionally, there is takeover interest in Jumia from Axian Telecom (BCBA:TECO2m), a Mauritius-based telecommunications company. According to a Bloomberg report, Axian Telecom has raised $600 million, which may be used to fund an acquisition of Jumia. The potential acquisition aligns with Axian’s strategy to expand its presence across the African continent. These developments highlight significant strategic moves for Jumia in the e-commerce and telecommunications sectors.
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