Stock Market Review: April 24, 2023

Ruth Ibikunle

The Nigerian Stock Market last week closed on a bearish note, shedding 1.04% week on week.

In a Stock market review with Mr Gilbert Ayoola, a Capital Market expert, the following were discussed:

Excerpts:

The market continued its down trend last week, shedding 1.04% week on week. Year to date, the market has returned 0.20%, dropping from 8.89% being the highest return as at February 28, 2023. When should we expect a bounce back?

The Stock Market has continued to move in a mixed directional pattern as investor remained cautious due to political pressure emanating from the different quarters of political class ahead of May 29 as we expect a new administration to head the nation.

Moreso, the new emergence in figures in the country’s inflation claiming up to 22.04% has remained a concern as the MPR struggles to check up the rising inflationary trend. As such, portfolio investors have remained careful, slowing down their position and preserve their funds to avoid cash trap due to economy situation.
Therefore, looking ahead of the new week, as some of the companies will be marked down for dividends payments, the market is bound to record gainers.

Zenith Bank shed as much as 12.2% last week from N25 to N21.95. How attractive is Zenith at the current price?

Zenith Bank last week was mark down for a dividend of N2.90 as shareholders await AGM. As a result of price adjustment, looking at Zenith at N21.95, looks attractive when compared to its 52-week high of N26.65 and 50-day moving average of N25.13. At current price, it is a good BUY.

Access, UBA and Stanbic has published their Q1 2023 results with significant growth in their top line and bottom line figures. How well will this impact their prices going forward?

It is seemingly knowing that investor react to companies with positive results. Therefore, considering the Q1 2023 released results by these banks, it has shown that their management is committed in growing revenue and increasing their earnings though with few impairments exposure as a result of their business activities and operations.

For UBA, it recorded remarkable growth across in all its major income lines. Its Interest Income rose from N125.9bn as at March 2022 and grew by 53.4% to N191.9bn by March 2023.

Similarly, Access Bank and Stanbic-IBTC recorded improved performance during their first quarter results respectively with increase revenue reported. Therefore, I believed that this will impact their performance as investor continues to position in the stocks thereby leading to price movement and appreciation.

How attractive is Transcorp at N2.45?

A stock that started moving at a price of N1.40 is currently trading at N2.45 within the last one week on acquisition of single majority investor holding 5.52% of the company’s shares. To me, this look very attractive and lucrative, considering the company’s last Public Offering done some few year back at N7.50. It is advised that investor should trade with some level of caution. Their Q1 2023 report recorded a drop in its PBT by 50.2% and a PAT of 63.1% respectively. EPS also dropped considerably from 5.17 kobo to 2.58 kobo.

What is driving the price of Fidelity Bank?

The shares price in Fidelity Bank is driven by investor sentiments ahead of the bank’s expected audited financial report due to be released, with the expectation that it could be better compared to the previous year.

Secondly, the price of the stock is cheap in line with some other banking stocks in the same sector.

What are the stocks to watch?

Stocks to watch for the week should continously be based on stocks with fundamentals and possibilities of price appreciation, looking at stocks like ACCESSCORP, Zenith, NAHCO.and many others.