By Peet Serfontein
Shoprite Holdings is an investment holding company whose combined subsidiaries constitute the largest fast-moving consumer goods (FMCG) retail operation on the African continent. The group holds a strong presence in South Africa and several other countries through various brands including Shoprite, Checkers, Usave, OK, House & Home and Hungry Lion.
The current phase in the price swing heatmap also supports our bullish case (see insert on the main chart). This weekly price swings heatmap visually highlights the alternation between bullish and bearish momentum. The consistent reappearance of green bars (indicating bullish swings) suggests that the share has repeatedly attracted buying interest and can reverse downward pressure.
The price is also testing its 200-day simple moving average (SMA), which can be regarded as bullish if the asset shows signs of stabilisation or upward momentum at this key technical level.
Upside momentum according to the Moving Average Convergence Divergence (MACD) histogram, as well as a sideways movement of the On-Balance Volume indicator, is also encouraging.
| Share Information | |
|---|---|
| Share Code | SHP |
| Industry | Food & Staples Retailing |
| Market Capital (ZAR) | 172.68 billion |
| One Year Total Return | 19.91% |
| Return Year-to-Date | 0.20% |
| Current Price (ZAR) | 292.01 |
| 52 Week High (ZAR) | 315.69 |
| 52 Week Low (ZAR) | 234.21 |
| Financial Year End | June |
| The share has been on a strong upward trajectory over the past few years but has been flat year to date. Various technical indicators suggest upside to come. | |
| Consensus Expectations (Bloomberg) | ||||
|---|---|---|---|---|
| FY24 | FY25E | FY26E | FY27E | |
| Headline Earnings per Share (ZAR) | 12.04 | 13.70 | 15.39 | 17.11 |
| Growth (%) | 13.78 | 12.34 | 11.14 | |
| Dividend Per Share (ZAR) | 7.12 | 7.67 | 8.58 | 9.51 |
| Growth (%) | 7.72 | 11.85 | 10.79 | |
| Forward PE (times) | 21.31 | 18.97 | 17.07 | |
| Forward Dividend Yield (%) | 2.63 | 2.94 | 3.26 | |
| Bottom-line growth is expected to remain robust over the forecast horizon. | ||||
Buy/Sell Rationale:
Technical Analysis:
Fundamental view
| Share Name and Position | MRP - BUY (Approaching a time exit) |
NTC - BUY (Continue to hold) |
GRT - BUY (Continue to hold) |
|---|---|---|---|
| Entry | 219.84 | 14.14 | 13.22 |
| Current | 241.31 | 15.09 | 13.49 |
| Movement | +9.8% | +6.7% | +2% |
|
The price is at the start of wave five out of the Elliott wave price theory which remains of interest. Remains below its 200-day simple moving average. Upside momentum supports the trade.
Our take profit target remains at R267 with a trailing stop-loss level at R223. Exit the trade on 9 June 2025. |
A double-bottom pattern remains of interest. Remains above its 200-day simple moving average. Upside momentum supports the trade strategy.
Our profit target is R16 with a trailing stop-loss at R14.40. Exit the trade on 21 July 2025. |
The share is trading at one of the highest price bins out of the price distribution analysis. Crossed above its 200-day simple moving average. Upside momentum regained strength, which supports the trade.
Our profit target is R16 with a trailing stop-loss at R12. Exit the trade on 17 November 2025. |
| Share Name and Position | QLT - BUY (Continue to hold) |
BVT - BUY (Continue to hold) |
ABG - BUY (Continue to hold) |
|---|---|---|---|
| Entry | 35.27 | 239.73 | 171.50 |
| Current | 35.88 | 243.59 | 173.32 |
| Movement | +1.7% | +1.6% | +1.1% |
|
The price action is at the start of Wave five of the Elliott Wave theory, which remains of interest. Remains above its 200-day simple moving average. Fading downside momentum supports the trade.
Our profit target is R41, with a trailing stop-loss at R33.70. Exit the trade on 14 July 2025. |
An inclining linear regression channel pattern remains of interest. Remains below its 200-day simple moving average and the trade idea is regarded as a counter-trend strategy. Upside momentum supports the trade.
Our profit target is R274, with a trailing stop-loss at R230. Exit the trade on 1 September 2025. |
A favourable peer comparison for the share remains of interest. Remains just below its 200-day simple moving average. Fading downside momentum supports the trade.
Our profit target is at R200, with a trailing stop-loss at R162. Exit the trade on 4 November 2024. |
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