The market continued the Bullish run into the third trading day of the week amidst investors repositioning and realignment of portfolios. Year to date the market has returned 23.94% as All Share Index closed at 33,268.36 points as against 26,842.07 points in December 31, 2019.
Equity market on Wednesday closed on a positive note as the All Share Index grew further by 1.90% to settle at 33,268.36 points from the previous close of 32,647.10 points.
Market Capitalisation grew by 1.90% to N17.384 trillion from the previous close of N17.059 trillion, which translates to N325 billion gain.
An aggregate of 858.16 million units of shares were traded in 8,142 deals, valued at N9.06 billion.
Commenting on the market performance, Mallam Garba Kurfi, Managing Director of APT Securities and Funds Limited said that he anticipated double digit return for the equity market. Good enough, the market has returned 23.94% year to date.
According to Mallam Kurfi, from all indication the bull is likely to continue up to the end of the year.
“The market is rising on the fundamentally sound stocks and not on mediocre stocks. The stocks that are gaining have good fundamentals and they are trading within the fair value. At that they can justify their price. We still have penny stocks that are trading at N0.20 and they did not gain. The investors are wiser and that shows you the impact of Institutional Investors and Foreign Investors who have selected stocks to go for; and it is obvious that they go for stocks with good fundamentals and that brought about the rising of the market.“
“Stocks with sound fundamentals can justify their prices. For stocks with good fundamentals, the sky is their limit. Most of the stocks are trading within their fair value and there is no cause for alarm.“
“The beauty of the current bull is that the stocks that can justify their prices are moving while the mediocre stocks for now are still down.“
“It is when the mediocre stocks starts rising without any reason that should bring about concern. For instance there was a time when Japaul was trading at N21, many other stocks were trading far above there their intrinsic value. In that kind of scenario, you know we are in crisis.“
The market breadth closed positive as 51 equities gained while 7 equities declined in their share prices.
Sterling Bank, Fidson Healthcare, Guinness and Neimeth led other gainers as they all grew their share prices by 10% respectively.
Glaxosmith, Oando and United Capital among other gainers also grew their share prices by 9.85%, 9.82% and 9.81% respectively.
Learn Africa led 6 other price decliners as it shed 4.76% of its share price to close at N1.00 from the previous close of N1.05.
C&I Leasing, Stanbic IBTC and Linkage Assurance among others also shed their share prices by 4.65%, 4.17% and 4.08% respectively.
- First Bank of Nigeria Holdings traded about 145.05 million units of its shares in 592 deal, valued at N1.078 billion.
- Transcorp Plc traded about 126.26 million units of its shares in 305 deals, valued at N141.2 million.
- Zenith Bank traded about 60.81 million units of its shares in 777 deals, valued at N1.52 billion.
STOCKS TO WATCH
Nestle was trading around N765 in April this year, today it is trading at N1400. In the past, Nestle has traded around N1700. So at the current price of N1400, it has not yet reached its peak.
Lafarge (WAPCO) is currently trading at N21.8. Two years back, it traded at N52 and that shows that it has not reached anywhere.
Zenith Bank closed at N25.6. With EPS of N6.65, Zenith bank has a low P.E ratio of 3.85x. This suggest that Zenith Bank is considered cheap at the current price and has further growth potential.
GUARANTY TRUST BANK
GT Bank is currently trading at N3. With earnings per share of N6.69, P.E ratio of 5.38x is estimated for GT Bank which is considered low. This suggest that the current price movement is justifiable as it is trading with its fair value.
The big elephant closed at N7.7 and that translates to 25.2% growth year to date. Precisely between October 6 and November 11, the share price of First Bank moved from N6.05 to N7.70, which represents 27.27% growth.
A strong BUY recommendation is indicated for FBNH on the technical Chart
Access Bank closed at 9.3 from the previous close of N8.9. Considering the 52 weeks high of N12, Access Bank has a uptrend potential of 22.5%.
On the technical chart a BUY recommendation is indicated for Access Bank.