Shoprite Holdings (SRGHY) AI Stock Analysis

• Market Cap: $9.03B
• Dividend Yield: 2.25%
• Average Volume (3M): 77.00
• Price to Earnings (P/E): 21.3
• Beta (1Y): 0.77
• Revenue Growth: 8.19%
• EPS Growth: N/A
• Country: US
• Employees: 140,000
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Department Stores
• EPS (TTM): 0.39
• Shares Outstanding: 591,339,000
• 10 Day Avg. Volume: 0
• 30 Day Avg. Volume: 77
• PEG Ratio: 1.61
• Price to Book (P/B): 5.20
• Price to Sales (P/S): 0.62
• P/FCF Ratio: 52.58
• Enterprise Value/Market Cap: 21.95
• Enterprise Value/Revenue: 0.78
• Enterprise Value/Gross Profit: 3.46
• Enterprise Value/Ebitda: 9.25
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 76 Outperform
• Price Target: $19.50 ▲(16.77% Upside)

Shoprite Holdings' stock is supported by strong technical momentum and solid financial performance, despite challenges with high leverage and declining free cash flow. The valuation is less attractive due to a high P/E ratio, but the overall outlook remains positive due to operational efficiency and market momentum.

Positive Factors

Revenue Growth

Consistent revenue growth indicates strong market demand and effective business strategies, supporting long-term expansion and stability.

Operational Efficiency

Stable gross margins reflect effective cost control, enhancing profitability and competitive positioning over time.

Market Position

Dominant market position in Africa provides scale advantages and a strong customer base, supporting sustained growth and resilience.

Negative Factors

High Leverage

High leverage can increase financial risk, potentially limiting strategic flexibility and impacting long-term financial health.

Declining Free Cash Flow

Declining free cash flow may hinder reinvestment and debt servicing, affecting future growth and financial stability.

Low Net Profit Margin

Low net margins indicate potential inefficiencies or pricing pressures, which could impact profitability and competitiveness.

Shoprite Holdings Business Overview & Revenue Model

Company Description

Shoprite Holdings Limited, an investment holding company, primarily engages in the food retailing business in South Africa and internationally. The company operates through four segments: Supermarkets RSA, Supermarkets Non-RSA, Furniture, and Other Operating segments. It also offers clothing, general merchandise, cosmetic, and liquor products; furniture, home entertainment, and floor covering products; and liquors, electrical and household appliances, and soft furnishings. In addition, the company distributes various pharmaceutical products and surgical equipment to pharmacies, hospitals, clinics, dispensing doctors, and veterinary surgeons. As of July 04, 2021, it operated 2,913 stores under the Shoprite, Shoprite Hyper, Checkers, Checkers Hyper, Usave, Shoprite LiquorShop, Checkers LiquorShop, House & Home, OK Furniture & Power Express, MediRite Pharmacy, TransPharm, Computicket, Computicket Travel, Checkers Food Services, Freshmark, k'nect, OK Foods, OK Grocer, OK MiniMark, OK Express, Sentra, OK Liquor, and Megasave brands. Further, the company provides ticketing, and car rental and accommodation services; stadium management, capacity management, travel management, and access control solutions; and short-term insurance and treasury management services. Shoprite Holdings Limited was founded in 1979 and is based in Brackenfell, South Africa.

How the Company Makes Money

Shoprite Holdings generates revenue primarily through the sale of goods in its supermarkets and retail outlets. The company's revenue model is centered on high-volume sales and competitive pricing strategies, which attract a large customer base. Key revenue streams include grocery sales, non-food items, and private label products, which often yield higher margins. Shoprite also benefits from economies of scale, allowing it to negotiate better pricing with suppliers. Additionally, the company engages in promotional activities and loyalty programs to drive sales. Strategic partnerships with local suppliers and manufacturers enhance product offerings and support operational efficiency, contributing to its overall earnings.

Shoprite Holdings Financial Statement Overview

Summary

Shoprite Holdings demonstrates strong revenue growth and operational efficiency, but faces challenges with high leverage and declining free cash flow. The company needs to focus on improving profitability and managing debt levels to ensure long-term financial stability.

Income Statement

Shoprite Holdings has demonstrated consistent revenue growth over the years, with a 4.98% increase in the latest period. The gross profit margin has remained stable, indicating efficient cost management. However, the net profit margin is relatively low at 3.00%, suggesting room for improvement in profitability. The EBIT and EBITDA margins are healthy, reflecting strong operational performance.

Balance Sheet

The company's debt-to-equity ratio is relatively high at 1.85, indicating significant leverage, which could pose a risk if not managed carefully. However, the return on equity is strong at 25.12%, showcasing effective use of shareholder funds. The equity ratio suggests a balanced capital structure, but the high debt levels warrant caution.

Cash Flow

Shoprite Holdings has experienced a significant decline in free cash flow growth, down by 69.61%, which is a concern. The operating cash flow to net income ratio is moderate, indicating decent cash generation relative to earnings. The free cash flow to net income ratio is lower than ideal, suggesting potential challenges in converting profits into free cash flow.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	252.70B	252.70B	240.72B	214.96B	184.08B	168.03B
Gross Profit	57.35B	61.44B	54.81B	51.71B	45.06B	41.21B
EBITDA	21.44B	24.66B	21.80B	19.68B	17.25B	15.78B
Net Income	7.58B	7.58B	6.25B	5.89B	5.71B	4.84B
Balance Sheet
Total Assets	124.94B	124.94B	112.33B	102.36B	91.45B	77.07B
Cash, Cash Equivalents and Short-Term Investments	10.07B	10.07B	13.02B	13.26B	11.11B	8.57B
Total Debt	55.88B	55.88B	49.37B	48.55B	42.13B	34.22B
Total Liabilities	94.83B	94.83B	84.60B	76.08B	65.83B	55.86B
Stockholders Equity	30.19B	30.19B	27.79B	26.13B	25.48B	21.08B
Cash Flow
Free Cash Flow	6.95B	2.98B	6.11B	3.12B	4.78B	4.76B
Operating Cash Flow	14.97B	10.98B	13.84B	9.83B	9.91B	7.98B
Investing Cash Flow	-7.37B	-7.37B	-6.78B	-6.23B	-4.06B	-653.00M
Financing Cash Flow	-8.28B	-4.30B	-7.75B	-2.85B	-7.24B	-9.74B

Shoprite Holdings Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 16.70
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SRGHY, the sentiment is Positive. The current price of 16.7 is above the 20-day moving average (MA) of 16.42, above the 50-day MA of 16.24, and above the 200-day MA of 15.62, indicating a bullish trend. The MACD of 0.14 indicates Negative momentum. The RSI at 60.17 is Neutral, neither overbought nor oversold. The STOCH value of 57.49 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SRGHY.

Shoprite Holdings Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
URBN	82 Outperform	$6.29B	13.34	19.34%	―	11.09%	51.51%
VIPS	81 Outperform	$9.10B	9.69	17.83%	2.46%	-2.97%	-8.57%
SRGHY	76 Outperform	$9.03B	21.29	25.27%	2.25%	8.19%	―
GAP	76 Outperform	$9.91B	11.94	25.10%	2.45%	0.29%	3.65%
M	74 Outperform	$5.63B	12.46	11.28%	3.23%	-2.83%	184.32%
KSS	68 Neutral	$2.17B	11.32	5.02%	2.33%	-6.13%	-22.57%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%