Meyer, Wema, Guinness, two others surpass 100% return
…drive stock market’s N6.2trn gain
Meyer Plc, one of Nigeria’s major manufacturers and marketers of paints, and four other companies topped the chart of stocks with returns of over 100 percent in five months to May 31.
The others are Wema Bank Plc, Academy Press Plc, Guinness Nigeria Plc, and Cadbury Nigeria Plc.
Nigeria’s stock market showed remarkable growth in the five-month period. Its performance indicators moved from year-open lows of 42,716.44 points and N22.30 trillion to 53,637.14 points and N28.916 trillion at the end of last month. While the All Share Index of the Nigerian Exchange Limited (NGX) rose by 25.57 percent, the value of listed stocks increased by N6.62 trillion in five months.
“The bullish run witnessed in April due to the impressive first-quarter (Q1) results seen across board spilled into May, as the market consolidated on April’s 5.69 percent gain to post a return of 8.05 percent,” market analysts at Lagos-based Vetiva Capital Management said in their May 31 note.
They said the positive close was possible despite the profit-taking seen towards the end of May as selected large-cap names like Airtel Africa Plc, which gained 27.49 percent month-on-month (m/m), lifted market performance.
“We are likely to see continued profit-taking across board creating buy interest in some of the fundamentally sound names, while large-cap names continue to dictate market direction,” the analysts added.
The N3.10 per share, which Meyer, the highest advancer, closed as at May 31 shows its price has risen by 573.9percent in five months. Meyer, with shares outstanding of 531,237,723 units is listed on the building materials subsector of the NGX Industrial Goods Sector.
Its unaudited interim consolidated financial statements for the first quarter ended March 31, 2022 shows group revenue of N341.804 million as against N223.473 million in the same period of 2021, representing an increase by 53 percent. The group’s pre-tax profit came lower at N7.136 million, from a high of N8.110 million in 2021, down by 12 percent.
The shares of the company are held as follows: 31.43 percent by Greenwich Capital Limited; 30.93 percent by Bosworth Investments & Services Limited; 6.03 percent by Osa Osunde; and 5.16 percent by Kayode Falowo and 26.45 percent by Nigerian citizens.
At N3.39, Wema Bank became the second-highest advancer in the period under review, rising by 370.8 percent. Its share price as at May 31 shows it nears record 52-week high of N3.85. With shares outstanding of 12,858,155,360 units, the lender continued its growth momentum in Q1 2022, building on the result it recorded in the 2021 financial year.
The bank posted N9.6 billion profit before tax in the full year ended December 31, 2021 as against N5.9 billion in 2020. The bank had paid a final dividend of 24 kobo per ordinary share to its shareholders.
Wema recorded gross earnings of N29.14 billion in Q1, representing a year-on-year increase of 62 percent as against the N17.96 billion recorded in the same period of 2021.
Its profit before tax soared to N3.3 billion from N1.5 billion in Q1 of 2021, reflecting a growth of 119 percent. Profit after tax also increased to N2.86 billion from N1.30 billion.
Wema Bank grew its deposit base in Q1 by 6 percent to N1.022 trillion from N968 billion in 2021, its loans and advances rose from N418 billion in Q1 2021 to N433 billion in Q1 2022.
Coronation Research analysts, in their May 23 note to investors, said: “The problem we are facing, and have faced all year, is that the market is in buoyant mood, and a variety of stocks can quite quickly start outperforming.
And, although we dislike chasing stocks, sometimes it is necessary to do this in order to keep up (as was the case when we started making notional purchases of Guinness Nigeria back in February; it has provided 111basis points year-to-date).
“We are content with our key overweight notional positions in MTN Nigeria, Dangote Cement, Seplat, Okomu Oil, Presco and Custodian Investment. However, we also need to raise cash in order to remain flexible.”
At N1.32, Academy Press share price increased by 164 percent in the five-month period. With outstanding shares of 604,800,000 units, the company nears its 52-week high of N2. The company is listed on the printing/publishing subsector of the NGX Services Sector.
Its reports and financial statements for the third quarter ended December 31, 2021 shows that its revenue increased by 118 percent to N2.754 billion from N1.265 billion in 2020. Profit after tax rose by 117 percent to N138.988 million as against a loss after tax of N179.552 million in 2020.
At N90.50 per share as at May 31, Guinness Nigeria share price increased by 132.1 percent in five months. Guinness, which has outstanding shares of 2,190,382,819 units, nears its 52-week high of N110. It recently announced its half-year unaudited financial result for the six months ended December 31, 2021, with its operating profit growing by 266 percent to N13.6billion.
As at May 31, other stocks that outperformed the market include: Cadbury (101.1 percent), Seplat (98.4 percent), PZ Cussons (87.7 percent), Airtel Africa (85 percent), SCOA (86.5 percent), Presco (84.5 percent), Nahco (77.8 percent), Learn Africa (75.2 percent), Fidson Healthcare (76.8 percent), Champion Breweries (68.1 percent), International Breweries (59.6 percent), Okomu Oil Palm (51.4 percent), Conoil (44.3 percent), Ecobank Transnational (43.7 percent), Eterna (34.1 percent), MRS (32.8 percent), United Capital (31.3 percent), and Oando (29.2 percent).