Naspers vs Prosus Which Is a Smarter Choice?

Naspers and Prosus are both South African multinational conglomerates that hold significant investments in various industries around the world, particularly in technology and e-commerce sectors. Naspers is known for its early investment in Tencent, which has become one of the largest technology companies globally. Prosus, on the other hand, was spun off from Naspers to focus more on its international investments. Both stocks are closely watched by investors for their potential growth opportunities and exposure to emerging markets.

Naspers or Prosus?

When comparing Naspers and Prosus, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Naspers and Prosus.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Naspers has a dividend yield of 0.19%, while Prosus has a dividend yield of 0.26%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Naspers reports a 5-year dividend growth of 1.56% year and a payout ratio of 6.98%. On the other hand, Prosus reports a 5-year dividend growth of 0.00% year and a payout ratio of 3.03%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Naspers P/E ratio at 3.29 and Prosus's P/E ratio at 4.86. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Naspers P/B ratio is 0.53 while Prosus's P/B ratio is 0.78.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Naspers has seen a 5-year revenue growth of 3.70%, while Prosus's is 1.19%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Naspers's ROE at 16.19% and Prosus's ROE at 16.24%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $49.40 for Naspers and $8.70 for Prosus. Over the past year, Naspers's prices ranged from $29.51 to $51.46, with a yearly change of 74.38%. Prosus's prices fluctuated between $5.47 and $9.20, with a yearly change of 68.19%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.