Jumia Technologies (JMIA), often referred to as the African Amazon (AMZN) due to its focus on ecommerce and digital services, saw its stock rise by 9% on Wednesday, crossing the $12 threshold. This surge comes after a previous 30% increase on Tuesday, marking a significant uptrend since late February. JMIA shares have gained over 220% year to date.
The recent rally can be attributed in part to Benchmark’s upgrade on Tuesday, giving JMIA a Buy rating and setting a price target of $14. Analyst Fawne Jiang highlighted the potential for growth in Jumia’s primary market of Africa, citing the region’s expanding youth population as a positive indicator for the company’s future prospects.
Despite facing losses for over a decade, Jumia has continued to attract investment and expand its platforms and products. While profitability may still be a few years away, the company’s reduced cash burn rate and strategic growth initiatives indicate a positive trajectory.
With JMIA now trading above penny stock levels, investors are optimistic about its future performance. Technical analysis suggests potential resistance at previous levels around $12.53, with further resistance at $17.00. The Moving Average Convergence Divergence (MACD) indicator points to continued upward momentum, supporting the expectation that JMIA could reach Benchmark’s target of $14.00 in the near term.
Overall, Jumia’s recent stock movements reflect growing investor confidence in the company’s long-term growth potential, particularly in the African ecommerce market.