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Prosus (NL:PRX)
:PRX
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Prosus
(OTC:PRX)
Rating:69Neutral
Price Target:―
Positive Factors
Dividends
Growing free cash flow generation of the e-commerce portfolio has increased investor focus on whether Prosus could announce a plan for returning the Tencent dividend to shareholders.
Earnings Guidance
Prosus pre-announced FY25 adjusted EBIT of at least $435m, exceeding its previously announced ambition and significantly above market expectations.
Financial Performance
Mid-term profitability targets for the e-commerce portfolio are likely to be strong, with the CEO focused on driving profitability and potentially announcing an ambitious plan for the Classifieds and Food Delivery business.
Negative Factors
Investor Expectations
Analysts expect the shares to rise based on the positive announcement, which may lead to heightened investor expectations and potential volatility if future results do not meet these expectations.
Prosus (PRX) vs. iShares MSCI Netherlands ETF (EWN)
Market Cap
$103.28B
Dividend Yield0.2%
Average Volume (3M)2.72M
Price to Earnings (P/E)16.2
Beta (1Y)1.70
Revenue Growth13.77%
EPS GrowthN/A
CountryNL
Employees21,048
SectorCommunication Services
Sector Strength88
IndustryInternet Content & Information
Share Statistics
EPS (TTM)1.24
Shares Outstanding2,378,947,800
10 Day Avg. Volume3,087,311
30 Day Avg. Volume2,715,579
Financial Highlights & Ratios
PEG Ratio1.10
Price to Book (P/B)3.93
Price to Sales (P/S)0.00
P/FCF Ratio87.09
Enterprise Value/Market Cap1.20
Enterprise Value/Revenue5.86
Enterprise Value/Gross Profit50.28
Enterprise Value/Ebitda-474.38
Forecast
1Y Price Target
$55.57Price Target Upside17.69% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering8
Prosus Business Overview & Revenue Model
Company DescriptionProsus N.V. engages in the e-commerce and internet businesses. The company operates internet platforms, such as classifieds, payments and fintech, food delivery, travel, education technology, etail, health, ventures, social, and other internet platforms. It has operations in Latin and North America, the Middle East, Africa, Europe, Asia, and internationally. The company was formerly known as Myriad International Holdings N.V. and changed its name to Prosus N.V. in August 2019. Prosus N.V. was incorporated in 1994 and is headquartered in Amsterdam, the Netherlands. Prosus N.V. is a subsidiary of Naspers Limited.
How the Company Makes MoneyProsus generates revenue primarily through its diverse portfolio of investments in technology and internet companies. A significant portion of its earnings comes from its stake in Tencent, which contributes through dividends and share appreciation. Additionally, Prosus owns and operates businesses in online classifieds, food delivery services, and fintech, which generate income through service fees, advertising, and transaction commissions. The company also benefits from strategic partnerships and investments in high-growth markets, enhancing its revenue streams through capital gains and returns on investment.
Prosus Earnings Call Summary
Earnings Call Date:Dec 02, 2024
(Q2-2025)
| % Change Since: 22.49%|
Next Earnings Date:Jun 30, 2025
Earnings Call Sentiment Positive
The earnings call reflected a generally positive sentiment with robust revenue growth, significant EBIT improvement, and successful IPO and asset sales. The company's focus on AI and ecosystem strategy was highlighted as a potential driver for future growth. However, concerns about increased central costs and a lack of clarity in capital return policies were noted as challenges.Q2-2025 Updates
Positive Updates
Strong Revenue Growth
Reported a 26% growth in revenue, showcasing strong performance across business segments.
Significant EBIT Increase
EBIT increased by 5 times, indicating improved operational efficiency.
Successful IPO and Asset Sales
Completed a $13 billion IPO and sold $2 billion in assets, strengthening the company's financial position.
Positive Free Cash Flow Growth
Free cash flow improved by 74%, with consolidated businesses contributing significantly.
Guidance Announcement
Provided first-time guidance with expectations of $6.2 billion in revenue and $400 million in EBIT for the year.
AI and Ecosystem Strategy
Focus on leveraging AI across the ecosystem to improve operations and develop new business models.
Negative Updates
Increased Central Costs
Reported an increase in central costs due to reallocation, impacting overall profitability.
Negative EBIT in OLX Brazil
OLX Brazil reported negative adjusted EBIT, attributed to increased investments in the period.
Challenges in Capital Allocation Communication
Concerns raised over the lack of a clear capital return policy, despite significant cash reserves.
Company Guidance
In the recent results call, the company provided several key metrics that outline its financial performance and strategic initiatives. The company reported a growth rate of 26% and a fivefold increase in EBIT. It recently executed a $13 billion IPO and sold $2 billion in assets. The company has $10 billion available for investment and is focused on strategic investments that leverage its ecosystem. For the first time, the company has given guidance for the year, projecting $6.2 billion in revenue and $400 million in EBIT. The call also highlighted the significant increase in free cash flow, which grew by 74%, and the company's commitment to disciplined investment and operational excellence. The company emphasized the importance of its ecosystem and culture, particularly in leveraging AI and innovation to drive future growth.Prosus Financial Statement Overview
Summary
Prosus shows a mixed financial performance with strengths in revenue recovery and EBITDA performance, but challenges in profitability and cash flow consistency. The balance sheet remains stable with manageable leverage. Overall, the company needs to focus on improving profitability and maintaining positive cash flow trends.Income Statement
The company's revenue has shown volatility, with a decrease from 2022 to 2023 but an increase from 2023 to 2024. Gross profit margin has improved in 2024, indicating better cost management. However, the net profit margin and EBIT margins are negative, reflecting challenges in profitability. EBITDA margin remains strong, suggesting potential for operational improvement.65
Positive
Balance Sheet
The balance sheet is solid with a relatively high stockholders' equity compared to total assets, indicating financial stability. Debt-to-equity ratio is moderate, suggesting manageable leverage. However, the decline in stockholders' equity over the years and high net debt in 2023 are areas of concern.70
Positive
Cash Flow
Free cash flow has improved significantly in 2024 after negative years, indicating better cash management. Operating cash flow to net income ratio is stable, although fluctuations in operating cash flow in previous years highlight volatility. The company shows potential for cash flow stabilization.60
Neutral
| Breakdown | |||||
| TTM | Mar 2024 | Mar 2023 | Mar 2022 | Mar 2021 | Mar 2020 |
|---|---|---|---|---|---|
| Income Statement | Total Revenue | ||||
| 5.87B | 5.47B | 5.76B | 6.87B | 5.12B | 3.33B | Gross Profit |
| 2.47B | 2.22B | 1.66B | 2.06B | 1.66B | 1.15B | EBIT |
| 1.00M | -546.00M | -1.34B | -859.00M | -976.00M | -593.00M | EBITDA |
| 189.00M | 7.75B | 10.48B | 8.82B | -831.00M | 4.14B | Net Income Common Stockholders |
| 7.81B | 6.61B | 10.11B | 18.73B | 7.45B | 3.77B |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | ||||
| 9.17B | 18.99B | 20.87B | 13.57B | 6.03B | 7.85B | Total Assets |
| 32.99B | 61.82B | 65.08B | 71.34B | 55.73B | 35.76B | Total Debt |
| 3.31B | 16.24B | 16.27B | 16.08B | 8.20B | 3.82B | Net Debt |
| 1.17B | 14.06B | 6.71B | 6.43B | 4.63B | -186.00M | Total Liabilities |
| 5.61B | 20.53B | 20.45B | 20.82B | 12.54B | 6.45B | Stockholders Equity |
| 27.25B | 41.26B | 44.59B | 50.42B | 43.07B | 29.10B |
| Cash Flow | Free Cash Flow | ||||
| 1.35B | 978.00M | -383.00M | -847.00M | 54.00M | -310.00M | Operating Cash Flow |
| 1.42B | 1.04B | -120.00M | -605.00M | 159.00M | -209.00M | Investing Cash Flow |
| 12.88B | 209.00M | 12.64B | 4.39B | -3.22B | 2.27B | Financing Cash Flow |
| -6.89B | -8.12B | -12.45B | 2.40B | 2.45B | 17.00M |
Prosus Technical Analysis
Positive
47.22
Price Trends
42.63
Positive
41.63
Positive
39.58
Positive
Market Momentum
1.04
Positive
65.36
Neutral
96.69
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NL:PRX, the sentiment is Positive. The current price of 47.22 is above the 20-day moving average (MA) of 45.95, above the 50-day MA of 42.63, and above the 200-day MA of 39.58, indicating a bullish trend. The MACD of 1.04 indicates Positive momentum. The RSI at 65.36 is Neutral, neither overbought nor oversold. The STOCH value of 96.69 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NL:PRX.
Prosus Peers Comparison
Overall Rating
UnderperformOutperform
Sector (61)
Financial Indicators
Performance Comparison
NL:PRX
Prosus
47.22
13.24
38.98%
UMGNF
Universal Music Group
31.26
0.58
1.89%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.