Back in our tar­get range

Finweek English Edition - - INVESTMENT - MARC ASH­TON

RE­CENTLY, we sug­gested in­vestors watch African Bank In­vest­ments Lim­ited (Abil) for a drop be­neath the R30 mark as an op­por­tu­nity to buy, which has now hap­pend.

The short-term sell-off ap­pears to be par­tially driven by a down­grade from rat­ings agency Moody’s, which may have seen the group be­ing sold down by some for­eign in­vestors who are man­dated to hold cer­tain grades of com­pany. How­ever, as Abil CEO Leon Kirki­nis points out, Abil main­tains a global in­vest­ment grade rat­ing, and the out­look from the agen­cies re­mains “sta­ble”, which sug­gests that it’s still com­fort­able with the op­er­a­tional risk at the lender. As­set man­agers like An­chor Cap­i­tal and Ves­tact con­tinue to hold the share, and if it is good enough for them, then it is prob­a­bly good enough for mere mor­tals.

For those with a higher-risk pro­file, you could con­sider some lever­age from th­ese lev­els as it seems to have devel­oped a sig­nif­i­cant mar­gin of safety. Watch your stop-losses but for now down-side risk seems lim­ited.

Newspapers in English

Newspapers from South Africa

© PressReader. All rights reserved.