Allan Gray Increases Stake as Clicks Shares Fall

The investment firm has boosted its holding in Clicks following a significant decline in the retailer's market valuation.

Updated on Oct. 16, 2026 in Investing

Bold flat-color editorial illustration of uniform pill bottles in a grid, symbolizing retail operational resilience and investment. — Investment firm Allan Gray has increased its stake in Clicks as the South African retailer faces a market valuation decline. AI Illustration. Upload story photo >

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Allan Gray has increased its shareholding in South African retailer Clicks as the company's stock price experienced a sharp downturn. The retailer has seen its market capitalisation drop by R21.39 billion in 2026 amid a broader shift in its earnings multiple.

Why it matters

The firm views Clicks as a robust business whose previous valuation was unusually high, characterising the current consumer spending pressures as a cyclical rather than permanent trend. This move suggests confidence in the retailer's long-term operational resilience despite current market headwinds.

Clicks shares currently trade at approximately 15 times earnings, down from a long-standing historical multiple of more than 30 times. The company continues to maintain a return on equity exceeding 30% while operating a network of 1,005 stores and pharmacies.

The players

Allan Gray

Allan Gray is a prominent South African investment management firm that focuses on long-term value investing.

Clicks

Clicks is a major South African retail pharmacy and healthcare chain with a nationwide store presence.

The details

Clicks reported an 8.1% increase in headline earnings per share for the half-year ending February 2026, even as its share price dropped to R243.03. The retailer plans to expand its footprint with 50 new stores during the 2026 financial year as part of a strategy to reach a network size of 1,200 locations.

The share price reached its peak in December 2024.
Half-year earnings were reported in February 2026.
Shares have declined 26.78 percent year to date in 2026.
The retailer intends to open 50 new stores throughout the 2026 financial year.

Market Dynamics

This activity reflects the broader retail earnings multiple contraction observed across the South African consumer sector. It highlights a shift in institutional sentiment where investors are re-evaluating historical premiums in favour of value-based positioning during cyclical downturns.

Retail investors holding Clicks shares may see increased institutional buying support the stock price as the company pursues its planned expansion. This development underscores the importance of monitoring earnings multiples when assessing long-term positions in retail equities.

The takeaway

The firm's decision to increase its stake during a downturn serves as a practical reminder that long-term investors often focus on business fundamentals rather than temporary market cycles. Readers should assess whether their own portfolios are positioned for such cyclical volatility or if they are overly sensitive to short-term price movements.