Jumia short-seller Andrew Left changes mind, now buying shares

By David Whitehouse

Posted on October 13, 2020 16:45

 The Jumia marketplace site is now operational in 13 countries on the continent, including Côte d’Ivoire (pictured here) © Jumia
The Jumia marketplace site is now operational in 13 countries on the continent, including Côte d’Ivoire (pictured here) © Jumia

Andrew Left, the short seller who drove down Jumia’s share price in 2019, has seen the light and is now buying the shares.

“I am positive on their outlook now that much of the fraud seems to be behind them,” Left told The Africa Report.  “Nigeria obviously will not be the only country in the world not to embrace e-commerce.”

  • Left said he has a long position in the shares and a price target of $50.
  • He says he will share his new investment analysis today in the US.

Left’s Citron Research firm in May 2019 declared that Jumia was fraudulent and that the stock was worthless. Jumia denied those claims, but the share price suffered. The stock, which reached a post-IPO peak above $40, sank lower than $5 earlier this year.

READ MORE Jumia chief executive denies short-seller Citron’s claims of fraud

A partial recovery has seen the shares reach their current level of $12. Part of that recovery is due to Left saying on Twitter on October 9 that there is “no way” he would be shorting Jumia stock. Now he has taken the plunge and started buying.

Jumia has lurched from crisis to crisis since listing in New York in April 2019.

READ MORE Jumia pain may not be over as shares slump below IPO price

Losses have continued, and Jumia has pulled out of markets such as Cameroon, Tanzania and Rwanda. German tech investor Rocket Internet, which in November 2019 had an 11% stake in the company, had completely bailed out by the start of April. In August, Jumia paid $5 million to settle class action lawsuits brought by investors in the US over its IPO documentation.

Stay tuned for Left’s analysis.

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