Investment experts at Bancorp Securities Limited, a leading investment research and service providing company in Nigeria, have projected that investors will tread cautiously in their decisions this week regarding the equities market amid risk off sentiment.
Despite the not too rosy outlook of the market, the firm in its ‘Weekly Stock Recommendations: Jun 20th – Jun 24th, 2022’ still recommended five stocks for strong buy this week based on the companies’ recent performances. The stocks include, GTCO, Zenith, UBA, WAPCO and MTNN.
While justifying its recommendations on GTCO as strong buy for the week, the investment research firm stated: “The released Q1′ 22 unaudited results show a recovery in interest income, which is being driven by loan growth and probable loan repricing.
“Despite a fall in foreign exchange trading profits, non-interest income increased by 7%. We anticipate that the acquisition of non-bank companies will boost shareholder value by exploiting cross-selling opportunities in its banking sector, and we anticipate that half-year results will reflect this”, it projected.
On the listing of UBA stock as one of the top buy stocks for the week, the Bancorp Securities experts stated: “Based on its Q1′ 22 results, the lender is on track to meet year-end projections. Both interest and non-interest income increased by double digits, which reflected in bottom-line growth.
“We anticipate that this performance will continue due to stronger loan growth compared to 2021 and an increasing focus on digital banking”, the analysts added.
Bancorp Securities recalled that previous week’s trading activities on the Nigerian bourse was fraught with negative sentiment as market was down in the four (4) days in which trading occurred.
Accordingly, it reported that the NGX-ASI declined by 2.7% w/w to close at 51,778.08 points, YTD return moderated to 21.2% (previously: 24.5%), while N767.3bn was shaved off-market capitalisation w/w to N27.9tn.
The report further stated “Similarly, activity level dwindled as average volume and value traded dipped 35.8% and 26.3% w/w to 235.2m units and N2.9bn respectively.
The top traded stocks by volume were UBA, STERLNBANK , and TRANSCORP, while ZENITH (N1.6bn), GTCO (N1.5bn), and MTNN (N1.1bn) led trade by value. Performance across our coverage sectors was unimpressive as all indicators fell.
The NGX Banking index led the laggards, down 5.2%, followed by Oil & Gas index with 1.8% w/w decline on account of selloffs in ETI, UBN, CONOIL and ARDOVA.
The Insurance and Consumer Goods indices dipped 1.2% w/w, 1.6% w/w driven by price decline in PRESTIGE, REGALINS, INTBREW and CHAMPION. Also, the Industrial Goods index declined 0.1% w/w following sell pressure on CUTIX and MEYER
