Capitec hammered following trading update

Capitec’s share price plummeted over 8% on Thursday following a trading statement for the half year ended 31 August 2022.

Capitec revealed that its headline earnings per share are expected to be between 3,964 cents and 4,067 cents per share.

It represents an increase of between 15% and 18% compared to the 3,447 cents per share reported in the previous period ended 31 August 2021.

Group earnings per share will be between 3,963 cents and 4,064 cents per share.

It represents an increase of between 17% and 20% compared to the 3,387 cents per share reported in the previous period ended 31 August 2021.

The trading update disappointed the market, sending the Capitec share price plummeting from R2,091 per share to under R1,930 per share.

Although Capitec continues to trade close to its peak in April this year, the latest decline means Capitec’s share price went into the red year-to-date.

The chart below shows Capitec’s share price over the last five days.

Capitec’s performance

Capitec has achieved exceptional performance since its launch, with all indicators, including revenue, book value, and earnings per share, pointing upwards.

However, the bank’s price-to-earnings ratio is significantly higher than its peers, which puts a lot of pressure on it to continually achieve standout results.

This time around, Capitec’s performance did not meet expectations which is why its share price took a hammering.

The charts below give an overview of Capitec’s performance.