FirstRand (FSR.JO)
Financials · JSE · South Africa
Fundamentals
Valuation and ratings
FirstRand trades at R97.86, close to the R90.00 our discounted cash flow model puts on the business. On this measure the market and the model broadly agree, so the interesting question is which of them is wrong.
Our moat model scores it 72 out of 100, which is a wide moat. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 12.3 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About FirstRand
FirstRand Limited, together with its subsidiaries, provides transactional, lending, investment, and insurance products and services in South Africa, rest of Africa, the United Kingdom, and internationally. It operates in Retail and Commercial, and Corporate and Institutional segments. The company offers deposits and savings products; personal loans; and asset and invoice finance, as well as SME commercial, residential, and buy-to-let mortgages. It also provides life and short-term insurance products; and vehicle finance, instalment credit and fleet management, and corporate and investment banking services. In addition, the company offers asset management, as well as vehicle-related insurance services. Further, it provides franchise advisory, market risk management, capital market flow, and trading and structuring services. It serves retail and public sector customers, small and medium-sized enterprises, businesses, agricultural industry, medium corporates, and institutions. The company was incorporated in 1966 and is based in Sandton, South Africa.
FSR.JO passes 6 of our 30 screens today
Each screen prints the exact criteria it used, and the circumstances in which it is wrong.
Common questions
Is FirstRand (FSR.JO) undervalued?
Against our discounted cash flow estimate of R90.00, FSR.JO at R97.86 is 8% above fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
What is FSR.JO's P/E ratio?
FSR.JO trades at 12.3 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
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Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.