Does Discovery still offer good value for investors?
The company is considered a leading global fintech firm, but opinion over its future is divided
Many investors have missed out on Discovery’s strong share price performance. Over the past year, the share is up 45% to R180. This puts the performance of Adrian Gore’s company far ahead of that of rivals such as Liberty (up 17%) and MMI Holdings (down 9%), as well as staid, established firms such as Sanlam (up 35%) and Old Mutual (up 17%). But few SA asset managers have benefited from this rise because, outside of the insurer’s main shareholder, Rand Merchant Investment Holdings (which holds 25.8%), the rest of Discovery’s shareholder register is dominated by foreign shareholders. The question is: does Discovery still offer good value for investors? Or has its major growth spurt already happened? One of the few SA funds with a weighting in Discovery of more than 5.5% is PSG Equity. Kevin Cousins, PSG’s head of research, says SA analysts tend to value Discovery by the method used to value insurance companies — its embedded value, which is a way of calculating the present value of i...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.