Ruth Ibikunle
The stock market last week closed on a positive note with 1.26% growth, week on week. Year to date, the market has returned 12.73% with All Share Index and Market Capitalisation at 48,154.65points and N26.229 trillion respectively.
In a stock market review with the MD/CEO of Global View Capital Limited, Aruna Kebira, the capital market expert gave in-depth insight on how to make profitable investment decision.
Excerpts:
• The stock market last week closed on a positive note with 1.26% growth week on week. What is the driving force behind this?
The market continues on its upward trajectory on the back drop of the liquidity occasioned by the current policy on the redesigning of the Naira notes by the CBN and the positive attendant consequences.
Up until the depleting of the volume of money that suddenly found their ways into the investment space from the stack-away cash, we will continue to witness forward movement in the market.
Moreover, portfolio managers will like to close the year on a positive note and to be able to do that and also because the price of a stock can only move by 10 % up or down, the journey to make that possible has to start in earnest. Therefore, we should be expecting also the Santa Claus rally to end the year
• What are the possibilities for the week?
Prices of many stock were badly beaten by the negative news that subsists at the market arena, many are trading at their 52 weeks low or trading very close to it.
I expect the buy interest to still be heightened and when that happens, demand will outweigh supply and prices will naturally hitch up.
The market will also return positive for the week.
• What is driving the price of PZ and Wema Bank?
PZ is still trading cum div with their declaration of final dividend of N1.01k Secondly in their Q1 2022, they returned a 464% growth in their earnings per share from 6k to 33k and the market is factoring this in their price and is also considering the fact that if they can pay N1.01 after an eps of 6k in their Q1 of 2021, then big surprise awaits shareholders at the end of their current financial year
Wema Bank had a good outing in their Q3 earnings release growing from 21.6k to 84.8k representing 292% growth.
Also remember, this is the only stock I know that have continued to generate enough earnings to support its price after its share reconstruction, little wonder that analysts has classified it as a cat with nine lives.
Even at the closing price of N3.43 on Friday, the earnings yield is still about 24% which makes it a candidate of my portfolio.
• How attractive is Nigerian Breweries at N45?
Nigerian Brewery 52 weeks high is N78 while it has just establish a new 52 weeks low at N36, The N0.40 dividend has been paid and the stock will be marked down on December 6 for the bonus of 1 for 4.
The mark down for the purpose of argument may bring the price of the stock to about N33 which will make it establish a new low and at that the market will move to bring it up, so at that marked down price NB will be a good buy.
• What are the possibilities in GTCO, MTN, Zenith, FBNH, Access and Presco
GTCO is still on its way up to catch up with the price of Zenith, given their recent performance from the Q3 2022.
MTN is good to go at the current price while Zenith, FBNH and Access are also in that category.
Presco at the current price of N113.00 is cherry picking based on its potential to scale up to its 52 weeks high of N200
• What are the stocks to watch?
Investors should keep their eyes on Wema Bank, Fidson, DangCem, Presco, Okomu Oil, NB and Fidelity Bank