Wole Olajide
The much anticipated season for corporate actions by listed firms on NGX is fast approaching as audited reports will soon be flooding the market. We saw that of Nigerian Breweries and BUA Cement last week with declared dividend of N1.03 and N2.80 respectively to shareholders.
The stock market last week closed on a positive note, returning 2.13% week on week. Year to date, the market has returned 7.22% with the All Share Index and Market Capitalization at 54,949.21 points and N29.934 trillion respectively.
Although a few companies have notified the Exchange that their FY 2022 results will not be published again by February ending due to regulatory approvals: we should expect those results latest by March 31st.
The following companies are expected to release their audited results with dividend declarations this week, that is February ending: Zenith Bank, GTCO, Access Holdings, UBA, Dangote Sugar, United Capital, African Prudential, WAPCO, Dangote Cement, NASCON, Seplat, Nestle, Champion Breweries and Ecobank.
Dividend paying stocks with impressive earnings would definitely be rewarded by the market with commensurate price growth. This is why investors should start taking position now.
Quite a number of fundamentally sound stocks can give good dividend yield and price appreciation. We are going to limit this discussion to a few stocks that are expected to release their results soon.
ZENITH BANK
Zenith Bank has notified the Nigerian Exchange that its Audited Financial Statement should be expected by the end of March 2023.
Zenith has paid interim dividend of 30 kobo in June 2022. We expect Zenith to pay at least a final dividend of N2.80 or more for 2022 year end.
At the current share price of N25.75, Zenith Bank will give dividend yield of 10.87%.
It is trading 5.33% away from its 52 weeks high of N27.2. Zenith Bank has the capacity to surpass its 52 weeks high of N27.2 based on the expectation that Zenith will grow its earnings in FY 2022.
Going by its Book Value of N41.68, relative to its current price of N25.75, Zenith Bank is cheap and embedded with growth potentials.
GTCO
GTCO already paid an interim dividend of 30 kobo. We expect GTCO to pay at least a final dividend of at least N2.70.
At the current share price of N25.50, GTCO will give dividend yield of 10.59%.
GTCO is trading 5.56% away from its year high of N27 and has the capacity to surpass its 52 weeks high as it is trading below its book value.
The Book Value of N29.66, relative to the current price of N25.50 implies that GTCO is cheap.
ACCESS HOLDINGS
Access Corporation has paid an interim dividend of 20 kobo in June 2022. It paid a final dividend of 70 kobo in 2021 year end. We expect growth in the earnings of the financial institution and of course improved dividend payout for 2022 year end.
If 70 kobo dividend is declared, relative to its current share price of N9.20, a position in Access will give a dividend yield of 7.61%.
Access is trading 12.38% away from its 52 weeks high of N10.50, which implies an uptrend potential of about 12% for Access Holdings.
It has the capacity to surpass its 52 weeks high of 10.50 based on the sound fundamentals inherent in company.
With the Book Value of N29.11, Access Holdings is considered very cheap, relative to its current share price of N9.20.
UBA
UBA has paid an interim dividend of 20 kobo to shareholders. The Bank paid a final dividend of 80 kobo in 2021 year end. We expect UBA to increase its dividend payout as growth is anticipated in the 2022 financial year end.
If 80 kobo dividend of the previous year is declared again, relative to its current price of N8.50, a position in UBA will give a dividend yield of 9.41%.
UBA is trading close to its 52 weeks high of N8.75 by 2.86%.
The Bank has capacity to surpass its 52 weeks high of N8.85 as it is trading far below its fair value.
Considering its Book Value of N23.64, relative to its share price of N8.50, UBA is underpriced.
UNITED CAPITAL
United Capital paid N1.50 dividend to shareholders in 2021 year end. We expect growth in the Company’s earnings for 2022 financial year with probable growth in dividend payout.
Should UCAP decide to maintain a dividend payout of N1.50 for FY 2022, a position in UCAP will give a dividend yield of 9.71% relative to its current share price of N15.45
UCAP is already trading very close to its 52 weeks high of N15.50. It might need to shed some weight below the current price for suitable entry.
DANGOTE CEMENT
Dangote Cement paid a final dividend of N20 to shareholders in 2021 financial year.
The Company is likely to maintain same dividend payout for 2022 financial year.
Relative to the current share price of N272, a position in Dangote Cement will give a dividend yield of 7.35%.
DANGOTE SUGAR
Dangote Sugar paid a final dividend of N1 in 2021 financial year.
Should the a dividend payout of N1 be retained for 2022 year end, a position in Dangote Sugar will give a dividend yield of 5.81%.
LAFARGE AFRICA (WAPCO)
Lafarge Africa paid a final dividend of N1 for 2021 financial year. In case same N1 dividend payout is retained for 2022 year end, a position in Lafarge Africa at the share price of N25.6 will give dividend yield of 3.91%.
At the current share price of N25.60, Lafarge Africa is trading 24.04% away from its 52 weeks high of N33.70, implying an uptrend potential of about 24%.
NESTLE
Nestle already paid interim dividend of N25 to shareholders in September 30, 2022. A final dividend of N25.50 was declared in 2021 financial year.
If the company decides to maintain a final dividend of N25.50 for 2022 financial year, then a position in Nestle at N1080 will give dividend yield of 2.36%.