Seplat, UAC, PZ beat other large cap stocks year-to-date

In the Year-to-date (ytd) period that saw investors losing N1.193 trillion from the value of listed equities at the Nigerian bourse, Seplat Petroleum Development Company plc, UAC of Nigeria plc, PZ Cussons Nigeria plc, Union Bank of Nigeria plc, Lafarge Africa plc, Dangote Sugar plc, and Access Bank plc respectively, recorded share capital appreciation that surpassed other equities in the NSE-30 basket.

BusinessDay’s trend watch between January 5 and February 27, 2015, shows that these stocks outshone others in the NSE-30 index which tracks the top 30 companies in terms of market capitalisation and liquidity at the Nigerian Stock Exchange (NSE).

Seplat Petroleum Development Company plc opened the two-month trading period with a gain of N118.5, from N351.50 to N470. UAC of Nigeria plc rose by N6.37 from N34 to N40.37. PZ Cussons Nigeria plc gained N5, from N23.99 to N28.99. Union Bank of Nigeria plc rose by N1.34, from N8.5 to N9.84.

Lafarge Africa plc recorded two-month gain of N4, from N81 to N85; investors in Dangote Sugar plc gained 18kobo, from N6.04 to N6.22; while those who held the shares of Access Bank plc throughout the review period had their share value raised by 2kobo, from N6.38 to N6.40.

Attractive pricing and positive outlook on dividend yield and improved regulatory oversight at the equities market are driving the buy-side at the Nigerian Stock Exchange.

But, on the flipside, uncertainty over the upcoming elections; wave of insecurity in North Eastern part of the country; rising yields and rates on fixed income securities; volatile exchange rate environment; declining crude oil price; and CBN’s tightening stance on banks are major draggers to the performance of Nigerian stock market.

Just last week, the value of equities at the Nigerian bourse rose by N240 billion as investors took position in value stocks ahead of releases of full year 2014 corporate earnings. The market capitalization of listed equities rose from N9.804 trillion to N10.044 trillion as at Friday, even-though, the value of listed equities stood at N11.237 trillion at the beginning of this year.

Tracking the performance of other large cap stock prices in the two-month period, revealed that Cadbury Nigeria plc lost N2.1, from N40 to N37.90; Dangote Cement plc lost N37, from N190 to N153; the share price of 7-Up Bottling Company plc declined by N8.42, from N165.40 to N156.98; Diamond Bank plc lost N1.55, from N5.45 to N3.90; Ecobank Transnational Incorporated plc dropped from N18.20 to N16.40, losing N1.8; FBN Holdings plc lost N1, from N8.70 to N7.70; while FCMB Group plc declined by 30kobo, from N2.50 to N2.20.

Despite recent drag-effect of profit-taking activities at the nation’s bourse, market analysts expected the stock market to rally further as investors take further position in value stocks ahead of Full Year 2014 results.

In the two-month period, the NSE All Share Index (ASI) declined by 3,839.48points or 11.31% from 33,943.29 points at the beginning of the year to 30,103.81 points Friday.

“On the Stock Market, the outlook on the banking stocks is bleaker than before in the short to medium term, and its effect is a negative sentiment by investors in banking stocks as we do not expect any surprises in FY’14 and Q1’15”, according to market analysts at Capital Bancorp plc.

“Owing to the fact that the banking stocks accounts for more than 25% of the equities, we expect to continue to see a ripple effect on other stocks and the NSE All Share Index.