JMIA - 2 Reasons to Buy The Amazon of Africa and 1 Pitfall to Consider
It's hardly surprising that Jumia Technologies (NYSE: JMIA) has struggled recently. Growth stocks have been squashed by the market due to inflationary pressures, rising interest rates, and ongoing political woes involving Russia and Ukraine. In times of great uncertainty, investors tend to exit positions in speculative stocks and flock to safer assets. Given Jumia, a Nigerian-based e-commerce platform, is highly unprofitable and not yet cash-flow positive, most investors have lost all interest.
As a result, the company has watched its share price plummet 77% over a one-year span. Jumia has a long way to go until it's proven successful, but the ongoing sell-off surely makes the company more attractive than it has been in quite some time. Equipped with 1.4 billion consumers, Africa is the last frontier for investors. And given that Jumia is the continent's pacesetter in e-commerce , I believe the company deserves a look. Here are two reasons to buy Jumia today and one pitfall to be aware of.
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2 Reasons to Buy The "Amazon of Africa" and 1 Pitfall to Consider