Airtel Africa’s recent financial performance has been impressive, with the company reporting a profit after tax (PAT) of $156.0 million in Q1’25/26. This growth is attributed to various factors, including the full quarter impact of tariff adjustments in the Nigerian OpCo, relatively stable foreign exchange dynamics, and sustained capital expenditure (CAPEX) investment.
Airtel Africa’s revenue is expected to rise by 16.6% year-on-year to $5.8 billion in FY’25/26, driven by resilient demand for mobile internet services and accelerating smartphone penetration. The company’s partnership with SpaceX to bring Starlink’s high-speed internet services to its customers in Africa is expected to expand coverage, improve customer experience, and provide cost efficiency.
The company’s net profit margins are expected to improve, driving its return on equity (ROE) recovery, with additional support from improved asset turnover. Airtel Africa has also reported a significant reduction in foreign exchange losses, which is expected to drive its profitability. The company’s earnings quality is marked for improvement, with a rebound likely due to revenue growth, cost efficiencies, and a healthier balance sheet.
CardinalStone maintains its BUY rating on Airtel Africa, with a raised 12-month target price of N3,906.75, implying a potential upside of 69.1% from the current market price. This expectation is driven by the company’s strong financial performance, growth prospects, and attractive valuation.
Overall, Airtel Africa’s strong financial performance, growth prospects, and attractive valuation make it an attractive investment opportunity. With its partnership with SpaceX and expected revenue growth, the company’s future looks bright
