- GTCO, Zenith and First Holdco Lead in Possibilities
- Fidelity, FCMB and Wema Show Significant Improvements
- Access is Worth a Consideration
Wole Olajide, ACS
The First Half of the year 2025 is over and we are now in the Second Half. In a matter of weeks, results of listed Companies on the Nigerian Exchange will start hitting the market in July.
Performance of Companies in their FY 2024 and Q1 2025 results was adequately rewarded with price appreciation as quite a number of stocks grew significantly. Profit taking have also brought down the prices of stocks, creating new entry opportunities for discerning investors.
In anticipation for Q2 2025 (H1 2025) results of quoted companies, it is wise for investors to start taking position ahead of these results. Expectation is the mother of all investment strategies. Investment in stocks is done against expectation and not on realities. In other words, you are buying into a company based on what you think you can get; that is expectation.
We deem it necessary to do earnings forecast for banking stocks ahead the release of their Q2 earnings for 2025.
Our projections of Q2 earnings for banks is based on their earnings growth rate for the past 5 years and PEG ratios. PEG ratio (price/earnings to growth ratio) is a valuation metric for determining the relative trade-off between the price of a stock, the earnings per share (EPS), and the company’s expected growth. In other words, it is not enough for anyone to invest on just the strength of a company’s previous or latest earnings but also in addition to their expected earnings.
ACCESS HOLDINGS
Earnings history of Access Bank Plc for Q1 and Q2 for the past 5 years show that the bank has been consistent in improving on its earnings per share, year on year.
Consistent growth is observed in the bank’s results within a financial year, Q1 to Q2. In other words, there was not a lower performance in a current quarter than the preceding quarter within a financial year.
Q2 earnings per share (EPS) of the Access Bank over the last 5 years has a Geometric Average Growth rate of 45.03%.
Relative to the current share price of N22.50 and Q2 2024 earnings per share of N7.61, P/E ratio is estimated at 2.96x.
PEG ratio of the Holding Company against the expected Q2 2025 earnings is 0.07. This implies that Access Holdings is underpriced.
Earnings per share (EPS) of about N8.47 is projected for Access Holdings Plc in Q2 2025.
The table below shows the Earnings per share (EPS) history of the financial institution for the past 5 years. The EPS in RED is the projected EPS.
ZENITH BANK
Zenith Bank has performed over the years with consistent growth in turnover, profit after tax and earnings per share especially with good dividend pay-out record. Consistent growth is observed in the bank’s results within a financial year, Q1 to Q2.
Q2 earnings per share (EPS) of the bank over the last 5 years has a geometric average growth rate of 53.57%.
At the current share price of N57.5 and Q2 2024 earnings per share of N18.41, the P/E ratio is calculated as 3.12x.
PEG ratio against the expected Q2 earnings is 0.06, which makes the share price of Zenith Bank underpriced at current price.
Q2 2025 earnings per share of about N20.88 is projected for Zenith Bank.
FIRST HOLDCO
Q2 earnings per share (EPS) of First Holdco Plc (formerly FBN Holdings Plc) over the last 5 years has a geometric average growth rate of 78.62%.
At the share price of N25.50 and Q2 2024 earnings per share of N10.18, P/E ratio of the Holding Company is calculated as 2.50x.
PEG ratio against the expected Q2 earnings is 0.03, which makes the share price of First Holdco underpriced at current price.
The EPS of N12.18 is projected for First Holdco against its Q2 2025 earnings release.
GTCO
Q2 earnings per share of the financial institution over the past 5 years has a geometric average growth rate of 78%.
At the current share price of N83.20 and Q2 2024 earnings per share of N32.12, P/E ratio is calculated as 2.59x.
PEG ratio against the expected Q2 earnings of GTCO is 0.03.
Q2 2025 earnings per share of N38.38 is projected for GTCO.
UNITED BANK FOR AFRICA
Q2 earnings per share of UBA over the last 5 years has a geometric average growth rate of 63.68%.
Relative to the current share price of N36.4 and Q2 2024 earnings per share of N8.90, the P.E ratio of the Bank is calculated as 4.09x.
PEG ratio against the expected Q2 earnings is 0.06, being less than 1 makes the share price of UBA underpriced at current price.
Q2 2025 earnings per share of about N10.32 is projected for UBA.
ECOBANK
Q2 Earnings history of Ecobank Transnational Incorporated (ETI) over the last 5 years has a geometric average growth rate of 59.4%.
At the current share price of N31 and Q2 2024 earnings per share of N8.78, P.E ratio of Ecobank is calculated as 3.53x.
PEG ratio against the expected Q2 earnings is 0.06 and this implies that Ecobank is underpriced.
Q2 2025 earnings per share of about N10.08 is projected for Ecobank.
FIDELITY BANK
Q2 earnings per share of Fidelity Bank over the last 5 years has geometric average growth rate of 89.13%.
At the current share price of N20 and Q2 2024 earnings per share of N4.99, P.E ratio of Fidelity Bank is calculated as 4.01x.
PEG ratio against the expected Q2 earnings 0.04.
Q2 2025 earnings per share of N6.10 is projected for Fidelity Bank.
WEMA BANK
Q2 Earnings history of Wema Bank over the last 5 years has a geometric average growth rate of 135.96%.
At the current share price of N16.50 and Q2 2024 earnings per share of N1.24, P.E ratio of Ecobank is calculated as 13.31x.
PEG ratio against the expected Q2 earnings is 0.10.
Q2 2025 earnings per share of about N1.66 is projected for Wema Bank.
FCMB
Q2 earnings per share of FCMB over the last 5 years has geometric average growth rate of 87.14%.
At the current share price of N9.30 and Q2 2024 earnings per share of N6.01, P.E ratio of the FCMB is calculated as 1.55x.
PEG ratio against the expected Q2 earnings is 0.02.
Q2 2025 earnings per share of N7.32 is projected for FCMB.
STANBIC IBTC
Q2 Earnings history of Stanbic IBTC Holdings over the last 5 years has a geometric average growth rate of 20.52%.
At the current share price of N84 and Q2 2024 earnings per share of N8.84, P.E ratio of Stanbic IBTC is calculated as 9.50x.
PEG ratio against the expected Q2 earnings is 0.46.
Q2 2025 earnings per share of about N9.30 is projected for Stanbic IBTC.
STERLING BANK
Q2 earnings per share of Sterling Bank over the last 5 years has geometric average growth rate of 31.02%.
At the current share price of N5.6 and Q2 2024 earnings per share of 56 kobo, P.E ratio of Sterling Bank is calculated as 10x.
PEG ratio against the expected Q2 earnings 0.32.
Q2 2025 earnings per share of 60 kobo is projected for Sterling Bank.
