CBN’MPC last week sat to determine rates for the last time in 2017. In the same vein, the last reports from the NBS on the GDP were released. As expected, the impacts of these were felt in the market. With waning earnings release, the market is expected to oscillate without a clear direction. In other words, profit taking will subsist as consistent price appreciation is not feasible.
The month of November ends this week while the last month of the year rolls in. since November is not an end of a quarter, the market is not expected to experience any meaningful rush for portfolio reshuffling.
The list of stocks herein contained is designed to guide but does not necessarily represent a buy recommendation. The list does not also officially represent the opinion of this publication but of the Analyst.
- FIDELITY BANK:
After one day of decline and two days of gains, Fidelity last week closed at N1.70. Going into the last month of the year, the stock seems to be pursuing a N1.77 price. Notably, 67kobo 2017 Quarter three earnings from 40 kobo in the previous year is attractive enough and makes the stock suitable for medium term hold. Please note that at current price, Fidelity’s PER is 2.64.
CAVEAT: The burden of unremitted NNPC funds
- STANBIC IBTC: Just one day of price gain last week paid for the previous three straight sessions of losses last week. To close the week, the price stood at N41.99. Low share cap and shareholding distribution remain the major sustaining factors for the stock as the N3.61 Q3 earnings, though a significant improvement over the N1.73 declared in the previous year, the PER of 11.63 is not competitive in the industry. Technically, the stock has the capability to attain its 12 months high, N44.30.
- INTERNATIONAL BREWERY: Recording N6.20 gain to close at N58, the stock could touch the N61 mark in an attempt to attain its 52-week high of N61.89.
- DANGOTE FLOUR:
Though its stock price declined for three sessions last week, it could yet be said to be resilient even it grew in just one session in the week. On the whole, for the week, it was a 23kobo Week-on-Week (WoW) price gain to close at N9.23. Significant growth in the company’s 2017 Q3 earnings to N2.55 from the previous 57kobo with PER at 3.62 all combine to make the stock attractive, not just in the short term but in the medium term all things being equal. Expectedly current level of resilience will be sustained as it moves close to attaining its 52 weeks’ high of N9.97. If the stock for whatever reason comes cheaper, it will only become far more buyable.
- ACCESS BANK:
The stock price recorded two days of gains and lost only once last week. A price of N9.77 is rather moderate for Access going by its 2017 Q3 EPS of 2.49 with a P.E. Ratio of 3.77. Access seems set to hit N10 shortly and thereby gradually rally higher in the near term.
- DANGOTE CEMENT:
Though priced beyond the reach of most retail investors, Dangote Cement is worth some considerations as possibilities of breaking its N245.17 resistance is high. Considering the price, expectedly, 2017 Q3 EPS of14.49 and P.E. Ratio at 16.57 might sound high when compared with some other low price stocks in the market, the company’s peculiar fundamentals make it buyable. The firm now operates in 14 African nations and growing stronger
Another company in the Dangote group, NASCON inched up in price twice last week. It was down for just one day to close at N15.10 or a growth of 4.14 percent for the week. The stock closed on offer Friday hence, stands to open weak this week but might improve into the week. Key attractions include the significant growth in its 2017 Q3 earnings to N2.04 from just 89kobo in the previous year. Going by the current price, the PER at 7.40. with favorable shareholding structure? You don’t expect to see the price down going forward.
- NIGERIAN BREWERIES:
The price was down three trading sessions last week. There was one day of a rather flat outing thus leaving only one trading session for a gain to close at N130.07 Friday. WoW, it was a decline of 6.29%. Despite the high price, NB pls closed with excess bid of over 22,000 units and offer of roughly 7,500 units Friday. Most probably, the price at weak open stands strong though might oscillate into the week. The stock is expected to regain its lost grounds as it is expected to rally towards its 12 months high of N193. The 2017 Q3 earnings of N3 and the Q3 PER at current price make the stock unattractive to retail investors. Its fundamentals make it most suitable for institutions and high net-worth investors.
- FORTE OIL:
The Femi Otedola led oil marketing company’ stock price lost in three trading sessions last week to close at N40. Closing with a higher bid size than offer portends a strong open this week. For the rest of the week, anything is possible.
Please note, investment in Forte oil carries high risk in the sense that the 2017 Q3 earnings was very low at just 50kobo against N2.27 it reported in the previous year. The PER is too high.
Despite all these, the fact that the stock price had seen a decline of well over 50% this year alone, favorable share distribution and a major force most times behind performances might just be the succor on which recovery hangs.
Technically, it looks set to at least attempt to regain its lost grounds of last week this week. The stock at any price around its present price is good is for the medium or long term to those who has the nerves for risk. Strategic investment in the power sector might be the long term attraction in the company’s stock.
The stock closed with an excess bid of 2.617 million units Friday though at relatively lower bid price. If sellers should hold on to their N1.38, Transcorp might have a strong start for the week though anything might happen into the week as the 2017 Q3 earnings that should be the firm support on which short term investment could hinge is yet to be released to the market. This is a never say die stock of a never say die company. The long term value of the company resides in its strategic investment in the power sector and the hold of a number of oil wells. Previous three weeks of losses, amount to nothing to those who have access to the real facts behind the recommended hold of the company’ stock into the future.
WISHING YOU A BULLISH WEEK