ruth ibikunle
The Nigerian stock market closed on a positive note last week with growth of 1.19%, week-over-week. So far this year, the market has returned 4.16% with the All Stocks Index and market capitalization at 44,492.73 points and N24,234 trillion respectively.
In a stock market review with Mr Gilbert Ayoolathe experienced capital market expert provided in-depth insight into the current market mood, possibilities and recommendations on profitable investment decisions.
Extracts:
• The stock market closed on a positive note last week with weekly growth of 1.19%. What could be responsible for this?
As is often said, the stock market relies on background information, whether positive or negative. We saw the NGX close strongly on the positive news trickling into the market, prompting investors to renew their buying interest in shares of Nigerian Breweries, MTN and FBNH, while their respective stock prices shares increased 10.00%, 4.79% and 3.77%. , respectively.
• What are the chances for the new week?
Chances remain high, knowing that some of the stocks still have the potential to rise in price due to bids to buy versus available supply from investors taking positions after these companies’ third-quarter results in forecast of the performance of the publication of the fourth quarter and the final results of the year knowing that the calendar year of the main companies ends on December 31.
• AXA Mansard led other gainers with growth of 15.69% last week, leading other gainers. What is raising the price? Is it a good BUY at N1.77?
If compared year-over-year between Q3 and Q3, the company in its Q3 2022 had declined due to operational challenges with a 55.04% drop in profit over the nine months to N1.711 billion N3 .806 billion in 2021.
Not to forget that he did a share restructuring, reason for the massive price appreciation in N2, also a current declaration of 6kobo dividend to his existing shareholders. When compared to their peers, any savvy investor looking to invest in insurance stocks is a good BUY considering the current price.
• Union Bank, GTCO, Nigerian Breweries and Unilever emerged among the top 5 gainers. What is driving the prices of these shares?
Many of these stocks have one or two activities or information surrounding them, while investor sentiment plays a separate role. Union Bank is currently conducting a Mandatory Takeover Offer (MTO) at a price of N7 per common share from its new lead investor to purchase an additional 6.46% stake of its shares to assume the acquisition of 100% of the company, while it is likely due to activity in GTCO at its low price compared to its 52-week high of N31.30 compared to its closing price of N16.80 last week.
For Nigerian Breweries, it is due to the recent declaration of 1 for 4 bonus spread from its proposed cancellation of unissued shares in accordance with the approval of the CAC guidelines. Whereas for Unilever, it’s basically based on shareholder sentiment about the renewed interest looking at the current price.
• Nigerian Breweries proposed a 1 for 4 bonus to shareholders. Is this capable of boosting the stock price? Are Nigerian Breweries a GOOD BUY?
Considering the share price from the previous 52-week high at N78.50, shares are currently cheap along with the company’s announcement of a 1 per 4 share bonus issued to its existing shareholders. This recent news has delighted many investors, thus creating renewed interest among company stakeholders who demand and purchase more shares, leading to a new on-demand price movement with no available sellers willing to deposit, thus brings the price offer to a new high before the close of the discount date scheduled for Tuesday, December 6 for the bond.
• Guinness dropped significantly by 18.96% to N60.50. How low is Guinness going to be? What should investors in Guinness do?
The share price will be significantly affected and will continue to fluctuate based on investor sentiment.
For any investor who wants or is interested in the brewing company like Guinness, now is the time to increase their buying stake in the company in anticipation of a further price increase due to better operating performance to increase profits.
• What are the chances at Fidson, Lafarge Africa, FBNH, Zenith and Access Bank?
These companies are good to start judging by their Q3 2022 results and performance. Although their prices may continue to move back and forth until they reach relative price stability due to profit taking activities. If checked, these companies are among the top leaders and players in their various sectors. In this account you are sure of the payment of dividends at the end of the year.
• Nigeria’s inflation rate grew to 21.09% in October 2022, according to NBS. How will this affect the capital market?
Nigeria’s inflation rate, which has risen to its highest level in more than 16 years, is holding back equity returns as interest rate hikes improve the outlook for the fixed income market. Once again, we start to see smart speed up and gradual slowdown knowing that this has pushed up the numbers in the consumer price index figure as well.
Nigeria’s high interest rate environment aimed at reducing inflation continues to make fixed income securities more attractive at the expense of equities, while the International Monetary Fund (IMF) also advises the CBN on the potential impact of this between the proposed redesign of some of the main currencies of the country. .
• What are the actions to monitor?
The investor should continue to look for companies with good performance records in the context of better dividend payout and price appreciation such as Zenith Bank, MTN, GTCO, AccessCorp, United Capital, Fidelity Bank, Flour Mills of Nigeria, Mansard, Transcorp Incorporated, Vitafoam and many others.