C&I Leasing, Dangote Flour and Chams continue to maintain their lead on the gainers’ table with five working days remaining in the first half of 2019. This is as the NSE All-Share Index (ASI) of the Nigerian Stock Exchange (NSE) closed last Friday at 29,851.29 points representing a decline of 5.02 percent year to date. On the contrary, the market capitalisation of equities closed at N13.15 trillion, which means the market value of listed equities, was more by N1.43 billion year to date, mostly attributable to the listing of MTN Nigeria shares.
The same bearish trend was exhibited by other sub sectoral indexes except for the NSE Premium Index which closed at 9.80 percent last Friday. Others closed in the negative territory. The NSE Corporate Governance Index closed at -13.17 percent; the NSE Main Board Index ended the week at -14.57 percent, while the NSE ASeM closed at -1.45 percent. The NSE Consumer Goods is the worst hit as it ended the period at -19.49 percent.
While the market ended bearish, investors sustained their interest in C & I Leasing as it continued to receive significant attention from market participants leading to a year to date 218.5 percent price appreciation. It closed last Friday at N5.67 per share. Dangote Flour was second on the table as it closed at N17 per share, translating to 148.2 percent gain year to date while Chams ended the period at N0.31 per share, amounting to 55 percent gain YTD.
MTN Nigeria ended the period at N130 per share representing 44.4 percent appreciation YTD. In a research report published by RMB Stockborkers, the target price of MTN Nigeria was put at N137 per share while United Capital Plc, one of the leading investment banks in Nigeria estimated MTN Nigeria’s target share price at N171.7 per share. Either way, the stock, even with 44.4 percent YTD gain, is currently underpriced.
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“In terms of valuation, we look at the Enterprise Value to EBITDA (EV/EBITDA) multiple for MTNN, this came to 6.3x, below 6.9x average for peers across the Middle East and African Markets. The implied fair price using EV/EBITDA model came to N145. However, by Price to Earnings multiples (P/E), MTNN has a PE of 13.9x compared to 20.4x for peers, implying a fair price of N194.5/share. Overall, our blended valuation model sees MTNN at N171.7/share, indicating that MTNN is underpriced at current price with a 25.7% upside potential”, United Capital Research stated in a note to clients early June.
Red Star Express, which closed at N5.50 percent, completes the list of the top five most appreciated stocks year to date, with 31 percent gain.
Other stocks that outperformed the market as the half year approaches are Sterling Bank, 27.4 percent; Caverton, 24 percent, Union Bank, 23.2 percent; Japaul Oil, 14.3 percent; Transnationwide Express, 12.3 percent; Livestock, 12.2 percent and AG Leventis, 11.1 percent.
The share prices of the remaining stocks on the gainers’ list posted single digit growth at half year, which ranges from 1.5 percent to 9.5 percent. The equities in this category include AIICO, Morsion Industries, Forte Oil, Cadbury, Prestige Assurance, Beta Glass, Custodina, John Holt, Wema Bank and AXA Mansard.
Others are Courtville, Sovereign Trust Insurance, Julius Berger, NEM, Fidson Healthcare and Access Bank.
On the flip side, CHI Plc, PZ, International Breweries, Academy Press and Thomas Wyatt led the pack of the decliners. They shed at least 42.1 percent and at most 90.6 percent from their share prices year to date.
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