gtag('config', 'UA-12595121-1'); Delta Corp’s Market Capitalization Remains Undervalued, Says Analyst – The Zimbabwe Mail

Delta Corp’s Market Capitalization Remains Undervalued, Says Analyst

Delta Corporation Head Office in Borrowdale, Harare
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HARARE – Delta Corporation Limited has witnessed a remarkable 45% surge in its market capitalization since June 12, 2024.

Despite this significant rise, financial analyst Sylvester Mupanduki of the SMRI Institute maintains that the stock remains undervalued, highlighting a 13% margin of safety in his latest valuation.

“While the recent growth in Delta’s market value is impressive, my analysis suggests that the stock still carries a degree of undervaluation,” Mupanduki stated. “Based on my valuation, there is a 13% margin of safety that investors should consider.”

Mupanduki attributes much of Delta’s revenue and margin expansion to its dominant beer segment. He projects that Delta’s revenue for the fiscal year 2025 will hit an unprecedented $862 million, with earnings before interest and taxes (EBIT) margins averaging around 20%.

“The beer segment has been a major contributor to Delta’s robust financial performance,” Mupanduki explained. “I am confident that the stock’s intrinsic value is roughly twice its current market price, indicating substantial long-term potential for investors.”

This optimistic revenue forecast aligns with Delta’s recent market performance, where the company has capitalized on growing consumer demand and strategic market positioning. However, Mupanduki’s caution about undervaluation underscores the need for a careful investment approach.

Other market analysts have echoed Mupanduki’s sentiments, recognizing Delta’s strong market presence but also warning about potential undervaluation risks. According to recent industry reports, the beverage sector has experienced significant growth, driven by increased consumer spending and favorable market conditions. Delta, with its extensive product portfolio and strong brand recognition, has been a primary beneficiary of these trends.

However, the broader economic context and potential market volatility remain concerns. As the global economy grapples with inflationary pressures and shifting consumer behaviors, companies like Delta must navigate these challenges while maintaining growth and profitability.

Despite the potential undervaluation, Delta Corporation’s strategic initiatives and market strengths position it well for continued growth. The company’s focus on innovation, market expansion, and operational efficiency are expected to drive future performance.

“Delta’s strategic vision and market adaptability are commendable,” Mupanduki concluded. “While investors should be mindful of the current valuation levels, the company’s long-term growth prospects remain strong.”

As Delta Corporation continues to navigate the dynamic market landscape, stakeholders will closely monitor its performance, balancing short-term valuation concerns with long-term growth opportunities.