Our opinion on the current state of SFN

Nov 3, 2023

Sasfin (SFN) is a banking group that specialises in various types of finance for small businesses and high net-worth individuals. It was listed on the JSE in 1987. The company has been investing heavily into its digital platforms and into acquisitions. The share was in a strong downward trend and we advised investors to wait until there was a measurable turn in the price such as an upside break through its long-term trendline before investigating further. That upside break has not yet occurred mainly because of the impact of COVID-19 but there are signs that the share is beginning to recover. On 16th October 2023 the company announced, "Sasfin has entered into binding heads of agreement to dispose of its capital equipment finance and commercial property finance businesses to African Bank Limited". This caused the share price to rise sharply. This is definitely a share to watch now. In its results for the year to 30th June 2023 the company reported total income up 7,31% and headline earnings per share (HEPS) down 19,42%. The company's net asset value (NAV) increased by 4,49% to 5122c per share. The company said, "Total costs were impacted, primarily, by an increase in costs within our Business and Commercial Banking pillar as well as the cost of the previously reported investigation into financial misconduct by former employees of the bank". We suggested that you should wait until it broke above its long-term downward trendline before buying. That happened on 7th June 2021 at 2200c. The share is now trading for 2849c.