Why Jumia Technologies Stock Is Tanking

Jumia Technologies AG JMIA shares are dropping Tuesday after the company posted worse-than-expected sales results for the second quarter.

The Details: Jumia reported revenue of $36.5 million which missed the analyst consensus estimate by 19.09% and represents a decrease of 17% year-over-year. 

Marketplace revenue was $20 million, down 10% year-over-year, and first-party sales revenue was $16.1 million, down 24% year-over-year. The company reported GMV of $170.1 million, down 5% year-over-year, with 13% gross profit as a percentage of GMV. 

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"Jumia delivered another quarter of acceleration in its usage trends along with improved cash efficiency. Continued execution against our strategic priorities drove a 7% year-over-year increase in Orders, while Orders per Customer, excluding JumiaPay app Orders, which do not incur logistics costs, climbed to 2.1 Orders in the second quarter of 2024," said Francis Dufay, CEO of Jumia Technologies. 

"GMV improved 35% year-over-year in constant currency and we delivered GMV growth in reported currency in six of our countries in the second quarter, up from five in the first quarter of 2024, a sign that the Jumia value proposition continues to resonate with the African consumer."

Outlook: The company reiterated its outlook for 2024 and aims to further reduce its cash utilization as compared to fiscal year 2023. Jumia said it projects an increase in both orders and GMV in 2024, excluding the potential impact of foreign exchange.

Will JMIA Stock Go Up?

When trying to assess whether or not Jumia Technologies will trade higher from current levels, it's a good idea to take a look at analyst forecasts.

Wall Street analysts have an average 12-month price target of $14 on Jumia Technologies. The Street high target is currently at $14 and the Street low target is $14. Of all the analysts covering Jumia Technologies, one has positive ratings, no one has neutral ratings and no one has negative ratings.

In the last month, one analyst has adjusted price targets. Here's a look at recent price target changes [Analyst Ratings]. Benzinga also tracks Wall Street's most accurate analysts. Check out how analysts covering Jumia Technologies have performed in recent history.

Stocks don't move in a straight line. The average stock market return is approximately 10% per year. Jumia Technologies is 71.13% up year-to-date. The average analyst price target suggests the stock could have further upside ahead.

For a broad overview of everything you need to know about Jumia Technologies, visit here. If you want to go above and beyond, there's no better tool to help you do just that than Benzinga Pro. Start your free trial today.

JMIA Price Action: According to Benzinga Pro, Jumia Technologies shares are down 49.8% at $5.32 at the time of publication Tuesday.

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Image: Courtesy of Jumia Technologies