- I believe Jumia Technologies is currently being priced as if it's going to become Africa's Amazon.
- However, unlike Amazon, Jumia is structurally unprofitable and is burning cash at a tremendous rate.
- Nevertheless, I concede there's a slight possibility that its bullish thesis plays out perfectly. However, this is very unlikely and would be a multi-decade long story.
- All in all, my valuation model suggests Jumia's fair value is just $7.51, which implies a 49.9% potential downside from current levels.
- Thus, I recommend that prudent investors pass up on the stock for now.
For further details see:
Jumia Technologies Price Is Detached From Its Fundamentals