Sell Rating for IHS Holding Due to Limited Growth Potential and Regional Challenges

In a report released today, Richard Choe from J.P. Morgan downgraded IHS Holding to a Sell, with a price target of $6.00.

Richard Choe has given his Sell rating due to a combination of factors impacting IHS Holding’s stock. Despite the company’s significant year-to-date stock increase and efforts to address past challenges, Choe sees limited growth potential in its core markets, particularly Nigeria and Africa. The modest growth outlook, coupled with uncertainties around long-term carrier capital expenditures in Nigeria, and potential currency weaknesses, contribute to a less favorable view.
Additionally, the company’s substantial exposure to Nigeria and Latin America presents challenges, with the latter requiring significant capital investment for tower builds. The presence of large stockholders, who could potentially offload their shares, adds an overhang risk to the stock. While IHS has shown solid execution and a low valuation, Choe believes there are more attractive opportunities in U.S. tower companies, which offer better growth prospects and are less affected by market volatility in emerging regions.