Stock Market Review: January 5, 2023

Ruth Ibikunle

The Nigerian stock market on Wednesday closed on a positive note with 0.12% growth, bringing the All Share Index and Market Capitalisation to close at 51,657.56 points and N28.136 trillion respectively.

In a stock market review with Mr Gilbert Ayoola, a seasoned capital market expert, the following were discussed:


• The market since the beginning of the year 2023 has been bullish. It opened on Tuesday with 0.67% growth, closed on Wednesday with a growth of 0.12%. Should we expect more bulls in coming days?

The equity market has continued to close on a positive ride of renewed trading position and growth due to some stocks thereby giving investor continued confidence and positive sentiment to remain trading in the stock market.

The activities over the last few days has led to many stocks reaching new high prices and recorded earnings in their weekly gains so much as maintaining a positive outlook in their prospects for further price increase as a result of demand by investors.

• What is the outlook for the year?

Presently with the look of things, the outlook remain brighten for investors who are seeing viable possibilities in the market and willing to position ahead of time and stick to the tide of the market for likely gains vis-a-vis the strong fundamental of these stocks, relative to their performance.

Likewise, with the expectations that many of the quoted companies will this year be able to rollout much earlier their financial reports in view of the forthcoming General Election come February 2023.

•  What is driving the price of Nigerian Breweries and NAHCO?

The drive behind the resurgence in the price of Nigerian Breweries is as a result of last mark down price cum to the dividend payment and bonus issued shares by the company to its shareholders, which has currently been obliged, now experiencing a new price movement as a result new investors’ buy interest due to the low price.

While for NAHCO, it is driven majorly due to market activities by insider dealing through one of the company’s Director buying position at a price of N6.20 thereby impacting positively on the price.

• Why is Champion Breweries trending down?

The fate of Champion Breweries is as a  result of current profit taking by investors who have brought into stock much earlier when compared the company’s 52-week high of N5.50 as against its 52-week low of N1.87.

• How attractive is Fidelity Bank at N4.79?

Fidelity Bank is known for its consistent growth in its earnings and regular payment of dividend. A bank stock less than N10 per share and currently trading at price of N4.79, with an EPS of N1.17 is a good BUY.

What are the possibilities in UBA, FBNH and Flour Mills?

UBA and FBNH are good and attractive at the current price to take position in. Knowing that both banks Q3 results show a lot of improvement over the previous year performance. Likewise in their earnings despite the high cost of inflation and economic challenges, both banks are able to keep afloat coupled with its large branches network and customer base spread. On a year-on-year basis, the companies are able to declare dividends to their investors.

Flour Mills is a good BUY. Even though the current price is presently being underpriced. Considering its Q2 results, it grew its revenue by 37.82% from N522.82bn to N720.58bn. While at the same, its PBT stood at N8.38bn and PAT equally stands at N5.7bn respectively. For me, it earns a BUY recommendation.

• What are the stocks to watch?

For possible stocks to watch as the market continues to be forward looking, investors should consider stocks based on sound fundamentals and strong earnings. Such stocks like Zenith, NGX, ROYAL EXHANGE, BUA Foods, Ecobank, Wema, GTCO, Seplat, MTN NAHCO, Presco, Vitafoam, Lafarge Africa and more.

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