With 129 stores across the country and three in Namibia Dis-Chem Pharmacies Limited is one of the largest leading corporate retail pharmacy groups in South Africa.
It was founded in 1978 by Ivan and Lynette Saltzman after qualifying as pharmacists. Its first store was opened in Mondeor, south of Johannesburg wherein they introduced the concept of a discount pharmacy with product categories that were not previously offered in pharmacies in South Africa.
Today, it offers a wide range of categories and products as it offers dispensary access, personal care and beauty, healthcare and nutrition, baby care, and other categories such as confectionery, household goods, and ancillary services that include clinics, and hair and beauty salons.
Its major shareholders are Foord Asset Management, Government Employees Pension Fund, Imvula Trust, and Berkeley Private Wealth.
Where can you buy the shares?
Buying Dis-Chem shares has been made easily accessible and simple.
There are various platforms you can use to buy Dis-Chem’s shares or stock with one being EasyEquities, an authorised financial provider. It is an investment online platform that allows anyone to buy shares in the brands and companies they like.
Moreover, it is easy to use, affordable, safe, and it is transparent about your investment. One can make an investment from as little as R5.
Here’s the Dis-chem’s latest consensus view:
- Market cap: 21,132,275,747
- EPS – TTM: 74.59
- P/E ratio: 32.94
- Forward P/E: 29.96
- Dividend yield: 0 %
- Last dividend: 0.13ZAR
- Date of last dividend: 2019/11/07
- Return on equity: 24.54 %
- Return on assets: 8.26 %
- Net asset value: 298.45
- Authorised shares: 1,500,000,000
- Issued shares: 860,084,483
Is it wise to buy Dis-Chem shares now?
The big question is “are Dis-Chem shares worth it?” well, just like any other investment, it’s all about taking risks.
Dis-Chem has done exceptionally well from inception to today, however, looking at their one-year trend below, Dis-Chem has been having its inconsistencies but, if you want to buy the shares there seems to be room for your shares to grow.
Although at its current level Dis-Chem is seen to be so close to its peak point or maximum growth, you should regularly monitor your investment if you buy the shares at the current level, just in case there is a downfall but, overall there is plenty of room to make a profit.
It is important to note that the Dis-Chem is less volatile than 75% of South African stock over the past 3 months, typically moving at +/- 3% a week.
Looking at Dis-Chem’s market performance in the past year, it has underperformed the consumer retailing industry which returned 17.9% over the past year.
Potential growth
Dis-Chem has the potential to grow further but not significantly.
Looking at the earning’s versus the savings rate its forecasted annual earnings growth has been set at 18.1% for the next 1 to 3 years which is above the savings rate of 9.2%.
And on its revenue versus the market, its revenue of 9.7% per year is anticipated to grow faster than the South African market which is 9.6% per year.
Quick Tip
One thing you should know is that the listing of Dis-Chem on the JSE is not an offer to the public.
According to the pharmacy CEO Mr. Salzman, it is all about placing shares with selected institutional investors in South Africa, qualified institutional buyers in the United States, and selected institutions in other territories.
This means that any retail investor will only be permitted to buy shares on the morning of listing on the Johannesburg Stock Exchange. Mostly, if demand is high, then the price will trade at a premium to the offer price at which institutions will have subscribed to the offer.
This price is anticipated to be between R16.25 and R20.25 per share. So, for example, Dis-Chem could open on the market at R20 per share, even if the offer price (which institutions bought at) was only ±R18.