Piet Viljoen’s JSE stock picks

Piet Viljoen, a portfolio manager and executive director at Merchant West Investments, selected three stocks during a recent JSE SA Stock Picks event – Astoria, Lewis, and AdCorp.

Viljoen recently won the Best South African General Equity Fund on a Risk-Adjusted Basis over five years at the 27th annual Raging Bull Awards. 

This is his second-consecutive Raging Bull award, winning the Best South African Equity General Fund in 2022. 

Piet’s winning fund, the Counterpoint SCI Value Fund, focuses on investing in South African companies that are undervalued and have strong growth potential. 

The fund has delivered exceptional returns for investors over the past five years, making it one of the top performers in its category. 

Despite the challenging economic environment in South Africa, Viljoen’s fund has managed to deliver consistent returns and solid returns for investors. 

Viljoen started as a lecturer at the University of Pretoria before joining the South African Reserve Bank as an economic analyst. 

He discovered value investing at Allan Gray Investment Counsel, where he became a portfolio manager in 1991. 

In 1995, Viljoen moved to Investec Asset Management, where he built up a following as the portfolio manager of the Investec Opportunity Fund before leaving to set up RECM in 2003.

RECM merged with like-minded firm Counterpoint Asset Management in 2020, where Piet continues to manage funds with mandates that suit his value-oriented style. 

In addition to his fund management responsibilities, he is a director of various listed and unlisted businesses.

Viljoen is widely regarded as an expert in value investing and has published numerous articles and commentary on the subject in leading financial publications. 

Below are his three stock picks and why he likes these companies. 


Astoria is an investment holding company that owns seven businesses, of which Outdoor Investment Holdings is the largest. 

Outdoor specialises in outdoor equipment, which it sells through its retail brand, Safari Outdoor. It also owns Family Pet Center, among other companies. 

Astoria has grown its earnings at an average annual compound rate of 20% for the last decade and is trading at a low price-to-earnings ratio of six. 

The company trades at a big discount on its net asset value (NAV). Most importantly for Viljoen is that it is cash-generative and growing. 

Trans Hex, one of the other companies Astoria owns, benefits immensely from a weakening rand as it is a diamond miner which earns revenue in dollars. 

Thus, it stands to benefit from the substantial decrease in the rand’s value since the beginning of the year. 

Lewis Stores

Lewis is “basically the last man standing” in the home furnishing retail sector, according to Viljoen. Thus, while it operates in a tough market, it has minimal competition. 

Furthermore, it has a very good management team and is highly cash-flow generative, giving it immense flexibility to respond to external shocks. 

Importantly for Viljoen, the company is buying back its own shares, which means that investors do not have to rely on other investors buying into the business to drive up the share price. 

Basically, Lewis is creating value for its shareholders by itself through share buybacks.

Lewis is buying back shares on a large scale, with over one-third of its outstanding shares being bought back in the last five years. 


Adcorp is a workforce solutions provider, which Viljoen says is “dirt cheap” at its current valuation, with the company trading below liquidation value. Essentially, its net equity is greater than its market capitalisation. 

Following on from Astoria and Lewis, Adcorp is also a “cash-rich” business. In the last seven years, it has undergone an incredible turnaround from R1.3 billion in debt to R300 million in net cash. 

Adcorp has also emerged from the tough period as an asset-light business that does not require substantial capital investment to grow. 

This means the company is cash-generative and thus able to buy back its own shares, which it has begun doing. 

Adcorp also declared a special dividend recently of R1.00. With a share price of R5, that is a 20% yield for shareholders.