I want to break down a stock I've been long on for a couple of months.

Jumia Technologies AG $JMIA

In the time period, we are in with all of the skyrocketing stock prices, it's time to look 5-10 years ahead and identify the companies of today that will become household names of tomorrow.

$JMIA is one of them.

Jumia is Nigeria's #1 E-commerce company.

One needs to acknowledge that Jumia is developing as a key player in the emerging African markets.

This means that:

There will be growing pains.
There will be challenges.
There will be ups and downs.

The key factors of why I've been long on $JMIA are:

1. Exponential growth of population in Africa

2. Exponential growth of e-commerce consumers in Africa and worldwide

3. An elite, multi-purpose platform of $JMIA

4. The first-mover advantage of $JMIA in the African markets

5. $JMIA is the only scaled e-commerce company in Africa

6. Potential $75b estimated market growth by 2025 for Africa e-commerce (Per McKinsey Global)

Now let's see the services offered by $JMIA

Jumia Marketplace - offers a wide range of goods such as smartphones, electronics, apparel, household goods, packaged foods, beauty, and perfumes.

$JMIA also provides:

Restaurant food deliveries
Hotel and flight booking
Advertising
Airtime recharge
Instant Deliveries

Jumia Logistics:

A large network of LEASED warehouses

Pick-up and drop-off locations for third-party sellers

Jumia Logistics facilitates and ensures a safe and reliable delivery of goods.

JumiaPay:

Easy, safe, and fast online payment solution on $JMIA platform.

$JMIA is active across 11 African countries, 600mm+ people, and accounts for more than 70% of Africa's GDP.

Now let's look at the financials (per Reuters research)

Valuation:

Price/Sales (TTM): 5.87
Price/Book (MRQ): 4.92

Profitability (%):

Gross Margin(TTM): 55.12
Operating Margin (TTM): (128.34)
Net Profit Margin (TTM): (127.11)

Financial Strenght (MRQ):

Quick Ratio: 2.5
Current Ratio: 2.6
LT Debt/Equity: 0.03
Total Debt/Eq: 0.05

Per Share Data:

Earnings (TTM): (3.43)
Sales(TTM): 2.54
Book Value(MRQ): 2.76
Cash Flow(TTM): (3.09)
Cash(MRQ): 3.50

Management Effectiveness(TTM) :

ROE: (83.69)%
ROA: (55.96)%
ROI: (81.37)%

GAAP EPS Growth and Trends:

Q1 2020: -$0.59
Q2 2020: -$0.55
Q3 2020: -$0.47

Change from Q1 to Q2 - 44.53%
Change from Q2 to Q3 - 35.28%

Revenues:

Q1 2020: $32.26
Q2 2020: $38.48
Q3 2020: $39.37
Q4 2020 est: $50.24

All in all, $JMIA is a long-shot. As a first-mover in E-commerce in one of the largest emerging markets, they hold a key advantage.

It will take years for $JMIA to become a big-time player, but for a buy-hold investor, the price fluctuations will not matter much.

Per @patrickc of Stripe:

“In absolute numbers, Africa may be smaller right now than other regions,
but online commerce will grow about 30% every year. And even with wider global declines, online shoppers
are growing twice as fast."

Continued

"Stripe thinks on a longer time horizon than others because we are an
infrastructure company. We are thinking of what the world will look like in 2040-2050.”

I personally believe in $JMIA and its management.

Obviously, this isn't investment advice.

I just wanted to share information about a company that I'm becoming more and more passionate about.