Bancorp Securities Limited, one of Nigeria’s investment research and consulting firms, has predicted that the nation’s equities market will sustain its positive trajectory this week as listed entities begin to ramp up their dividend payment projections.
Investment analysts in the firm made this projection on the Nigerian Exchange (NGX) trading trend this week in the firm’s ‘Weekly Stock Recommendations: Dec 5 – Dec 9 2022’ published on Monday.
Specifically, the experts predicted: “In December, we expect the market to improve slightly on the back of improved sentiment and year-end portfolio review in anticipation of full year dividend payment.”
The experts also recommend the stocks they considered as strong buy for investors during the week as including ZENITH, GTCO, MTNN and WAPCO based on what they termed the companies’ recent financial and other performance assessment criteria.
According to the Weekly Stock Recommendations, the firm’s analysts based their recommendation on WAPCO on the listed firm’s financial results which “underscore the company’s resilience as it remains committed to maximize volume opportunities across the African markets driven by sustained product demand.
“Accordingly, our fair value for the stock is N33.00, based on our fair value, the stock offers a 49.66.% expected return and 9.07% dividend yield”, they added.
This is even as they hinged their recommendations on GTCO partly on “the Group’s balance sheet remained well structured and resilient with total assets and shareholders’ funds closing at N5.81trillion and N872.8billion, respectively.
“Strong Capital Ratios and asset quality were sustained as CAR, NPL ratio, and Cost of Risk (COR) closed at 20.7%, 5.6%, and 0.2% in September 2022.”
Meanwhile, the Bancorp Securities’ investment researchers noted that the equities market index started December with a 1.26% week on week surge, crossing the 48,000 mark to 48,154.65 points, while the market capitalization also inched higher by 1.26% w/w to N26.23 trillion, indicating an uptrend and a relative return of strength to the market. Accordingly, the YTD return improved to 12.73% (previously: 11.33%).
They attributed the upbeat in market performance partly to price appreciations in stocks such as PZ (+15%), UACN (+14%), WEMABANK (+10%), ARDOVA (+10%) and NEM (+9%).
Thus, investors gained N326.98 billion in 3 out of the 5 trading sessions last week. However, the level of trading activities varied as the total volume traded increased by 16.90% w/w to 0.83 million units while the total value traded declined by 19.05% w/w to N12.41 billion.
