Finweek English Edition - - INVESTMENT -


BUY Noah Cap­i­tal Mar­kets has s hr ugged of f t he neg­a­tivit y around the JSE-listed mi­crolen­der and told clients that it has a pos­i­tive out­look for the lender. The f irm has a 12-month price tar­get of R29.78/share but did warn (when the share was trad­ing around R21/share): “Abil is his­tor­i­cally known for its strong div­i­dend yield and is con­se­quently held by a num­ber of div­i­dend funds. ABL has in­creased the div­i­dend cover ra­tio to 5.0x, which is likely to re­sult in th­ese div­i­dend funds off load­ing the stock, re­sult­ing in fur­ther pres­sure to the share price. The fact that the div­i­dend cover ra­tio is so high and that a scrip elec­tion has been of­fered sug­gest that the cap­i­tal po­si­tion is not as ro­bust as man­age­ment main­tains.”

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