Finding the best African stocks to buy is a challenge worth taking up. Africa last great investing frontier.
The booming economies of China and India have made many investors eagled-eyed for what’s coming next, but there are still plenty who haven’t yet dipped their toes into emerging markets such as Africa.
The search for the best African stocks has put several companies in the spotlight for investors looking for massive gains ahead.
Africa is changing rapidly, and the middle class, in particular, has been growing at an incredible pace. The continent may have well over 300 million members already!
Additionally, with the proliferation of tech, the continent can effectively skip entire development levels and catch up with the world’s top economies. Having said that, here are some of the best African stocks to invest in now.
| JMIA | Jumia Technologies | $7.82 |
| IMPUY | Impala Platinum Holdings | $11.11 |
| AFMJF | Alphamin Resources | $0.52 |
Jumia Technologies (JMIA)
Jumia Technologies (NYSE:JMIA) is a leading eCommerce player on the continent. JMIA generated plenty of buzz over the past couple of years based on its massive addressable market and upside potential.
However, with an inability to control costs and exercise discipline in its expansion plans, JMIA stock has traded in the red of late. It seems it has turned a corner in the second quarter on multiple fronts.
Jumia reported its second-quarter results last month. Quarterly active users were up an incredible 25% from the prior-year period to $3.4 million, while platform orders rose by 35% to 10.3 million.
Also, merchandise and payments volume were up by an incredible amount as well. Also, it re-iterated its 2022 sales guidance of $200 million to $220 million.
Furthermore, its management has done remarkably well in implementing cost controls to limit the growing quarterly losses.
Sales and advertising costs as a percentage of gross merchandise value grew to 10.1% in the third quarter of 2021. However, the company managed to bring that down to 7.5% in the second quarter.
If it can continue to grow at scale and keep costs in check, JMIA stock may be a fascinating long-term play.
Impala Platinum Holdings (IMPUY)
Impala Platinum Holdings (OTCMKTS:IMPUY) is a leading South African mining stock with a spectacular track record over the past several years.
Its top-line results have grown by more than 34.50%, while its EBITDA has grown by over 115% on average over the past five years. Lately, its results have witnessed a marked slowdown from yesteryears due to acquisition challenges and refinery bottlenecks.
Moreover, macroeconomic and geo-political headwinds have further weighed down operating results.
Impala operates five mines and a couple of refineries, primarily in the South African region. It has invested a ton of money in improving its mines which, coupled with its mining operations, have collectively generated close to 26 billion South African Rand.
With lower-than-expected export activity from Russia and a likely $220 billion stimulus from the Chinese economy, we could potentially see Impala filling a major supply gap in the platinum group metals space in the upcoming years.
Alphamin Resources (AFMJF)
Alphamin Resources (OTCMKTS:AFMJF) operates as a tin producer in Congo, though its headquarters are on the island of Mauritius.
Over the past years, it had a difficult time in the stock market due to a steep drop in global tin prices. Tin prices have dropped 50% since March, and there’s more carnage ahead.
Though its Bisie complex wrapped up the second quarter with record production numbers of 3,180 tonnes of tin, its average selling prices dropped below the $15,000 per tonne mark.
Moreover, its cash position improved by just over $8.2 million to $138 million. Though its near-term outlook looks troubling, it trades at just 1.3 times forward sales. Also, investing in it comes with close to a 5% dividend yield. Therefore, if the markets mount a comeback in the next few months, AFMJF could be an interesting bet.
On the date of publication, Muslim Farooque did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
