Anglo African Agriculture PLC

Anglo African Agriculture PLC (LON: AAAP) is an LSE-listed Company focused on the development of an agricultural trading group in Africa.

Investment Rationale – WATCH at GBX 4.00

• Weak Fundamentals: The Company’s top-line business demonstrated a decline during H1 FY21. Moreover, the losses increased during H1 FY21.
• Delay in Financial Reporting: AAAP had shown a significant delay in reporting FY21 financial results. Moreover, the results for 12 months ended October 2021 would be expected by March 2022.
• Macroeconomic Risk: The Russian invasion in Ukraine has already jolted the market, while the global stagflation fear can keep the equity market under pressure.
• Low Market Capitalization: Considering the low market capitalization of less than £1.00 million, the stock price may undergo sizeable corrections.
• Technical Indicator: AAAP's prices started to recover from the lower level and currently facing stiff resistance from a downward sloping trend line. On the weekly chart, the leading indicator RSI (14-period) is trading below mid-point at 40.79 levels, supporting a downside direction. The trend-following indicator 21-Period SMA (at GBX 3.92) is placed below the CMP, supporting an up-move; however, the 50-period SMA (at GBX 4.96) is above CMP which may act as a resistance level for the stock.

One Year Share Price Chart

 (Source: Refinitiv, chart created by Kalkine Group)

Conclusion

Please note markets are trading in a highly volatile zone currently due to certain macro-economic and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Based on the low market capitalization, weak fundamentals, and unfavourable technical indicators, we have given a “WATCH” recommendation on Anglo African Agriculture PLC at the closing market price of GBX 4.00 (as on 08 March 2022). The stock has not traded as on 09 March 2022 (as of 2:15 PM GMT).

Investors can evaluate the stock based on the support and resistance levels provided in the report in case of keen interest taking into consideration the risk-reward scenario. 

Note 1: The reference data in this report has been partly sourced from REFINITIV.

Note 2: Investment decisions should be made depending on the investors’ appetite for upside potential, risks, holding duration, and any previous holdings. Investors can consider exiting from the stock if the Target Price mentioned as per the Valuation has been achieved and is subject to the factors discussed above.

Note 3: ‘Kalkine reports are prepared based on the stock prices captured either from the London Stock Exchange (LSE) and or REFINITIV. Typically, both sources (LSE and or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’

Disclaimer

References to ‘Kalkine’, ‘we’, ‘our’ and ‘us’ refer to Kalkine Limited.

This website is a service of Kalkine Limited. Kalkine Limited is a private limited company, incorporated in England and Wales with registration number 07903332. Kalkine Limited is authorised and regulated by the Financial Conduct Authority under reference number 579414.

The article has been prepared for informational purposes only and is not intended to be used as a complete source of information on any particular company. No advice or information, whether oral or written, obtained by you from Kalkine or through or from the service shall create any warranty not expressly stated. Kalkine does not intend to exclude any liability which it is not permitted to exclude under applicable law or regulation.

Kalkine does not offer financial advice based upon your personal financial situation or goals, and we shall NOT be held liable for any investment or trading losses you may incur by using the opinions expressed in our publications, market updates, news alerts and corporate profiles. Kalkine does not intend to exclude any liability which it is not permitted to exclude under applicable law or regulation. Kalkine’s non-personalised advice does not in any way endorse or recommend individuals, investment products or services for your personal financial situation. You should discuss your portfolios and the risk tolerance level appropriate for your personal financial situation, with a professional authorised financial planner and adviser. You should be aware that the value of any investment and the income from it can go down as well as up and you may not get back the amount invested.

Kalkine Media Limited, an affiliate of Kalkine Limited, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.