Following the recent release of Airtel Africa Plc Q1-27 Earnings, Cordros Research has updated its rating on the stock from Buy to Hold, noting that the momentum remains Intact.
“However, with the stock having largely priced in the stronger outlook, our implied upside narrows to 16.9% from the current market price of NGN5,801.40, leading us to downgrade our rating from “BUY” to “HOLD”. Stated Cordros Research.
Cordros Research in its update forecast a 60.7% y/y growth in PAT in 2027E. EPS including NCI is forecast at USD0.36 (2027E-2031E CAGR: +13.9%), while DPS is forecast at USD0.08 (2026FY: USD0.07).
The Cordros Research in its outlook update of AIRTELAFRI for 2027E following the release of the company’s Q1-27 results, made a forecast of sustained growth across revenue (+24.0% y/y), EBITDA margin (+75bps y/y to 50.0%) and EPS (+93.0% y/y to USD0.36).
The view, according to the investment analysts is predicated on three factors, comprising, sustained momentum in data, with usage per customer projected to rise by 13.7% y/y to c.10.1GB per month, also on a steadily expanding customer base (voice net adds: +18.1 million | data: +12.5 million.
And the third, which is predicated on operating leverage as cost-efficiency initiatives hold.
Based on the above, Cordros raised its target price to NGN6,782.60.
“Accordingly, we raised our target price to NGN6,782.60 (Prev.: NGN4,362.49), reflecting improved earnings expectations.
However, with the stock having largely priced in the stronger outlook, our implied upside narrows to 16.9% from the current market price of NGN5,801.40, leading us to downgrade our rating from “BUY” to “HOLD”. We also forecast a total dividend per share of USD0.08 for 2027E (Dividend yield: 1.8%). Based on our estimates, AIRTELAFRI trades at a 2027E P/E of 12.0x and an EV/EBITDA of 5.4x vs MEA peer averages of 16.1x and 6.1x, respectively.
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