PZ Cussons’ European business remains resilient, but Nigeria continues to weigh on profits given the uncertain outlook for consumer spending and FX. The stock dropped c 9% after results and trades at 13.6x 2017e P/E, a sharp discount to its peer group. Although the company is well positioned to benefit from a turnaround in its core African business, in our view a rerating is dependent on an improvement in macro conditions.

27 Jan 2016
Negative FX and emerging market challenges

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Negative FX and emerging market challenges
PZ Cussons Plc (PZC:LON) | 68.2 -0.1 (-0.1%) | Mkt Cap: 292.6m
- Published:
27 Jan 2016 - Author:
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Pages:
2 -
PZ Cussons’ European business remains resilient, but Nigeria continues to weigh on profits given the uncertain outlook for consumer spending and FX. The stock dropped c 9% after results and trades at 13.6x 2017e P/E, a sharp discount to its peer group. Although the company is well positioned to benefit from a turnaround in its core African business, in our view a rerating is dependent on an improvement in macro conditions.