Buy/Sell/Hold is a weekly column which samples opinions on a variety of stocks. Stocks are picked from gainers and losers of the previous week, as well as analyst reports by several investment houses.
Here are the stocks on our Buy Sell or Hold list for the week ending 15th May 2018.
Unity Bank: SELL
Latest Results: Results for the 9 months ended September 2017 show Gross earnings increased from N64.5 billion in 2016 to N65 billion in 2017. Profit before tax, however, fell from N3.8 billion in 2016 to N2.7 billion in 2017. Profit after tax also dropped from N3.4 billion in 2016 to N2.4 billion in 2017.
Pricing: N1.05
Price-earnings ratio – 10.36x
Price to book ratio – 0.14
YTD Return – 98
One year return – 75%
Buy/Sell/Hold is a weekly column which samples opinions on a variety of stocks. Stocks are picked from gainers and losers of the previous week, as well as analyst reports by several investment houses.
Here are the stocks on our Buy Sell or Hold list for the week ending 11th May 2018
Anlaysts View
Analysts at Afrinvest have placed a SELL rating on the stock. They have a target entry price of N0.50, which is 50% below its previous target price of N1 as at when the report was written.
Our view
In Nairametrics’ view, Unity Bank is a SELL. The stock is currently trading at. Unity is also yet to release its financial statements for the full year ended December 2017, which is often an indication of a bad result.
The capital appreciation seen was largely due to the move into penny stocks in the first half of the year and news of a possible investment by Milost which has since been terminated.
Diamond Bank: SELL
Latest Results – The bank last week Friday released its FY 2017 and Q1 2018 results. It made a loss after tax of N9.01 billion in 2017 as against a profit after tax of N3.49 billion in the prior year.
For the first quarter ended March 2018, the bank made a profit after tax of N784 million as against N4.29 billion recorded in 2017.
Pricing – N1.81
Price-earnings ratio –9.58x
Price to book ratio – 0.77
YTD Return – 20.67%
One year return – 81%
Latest information
The bank last week released its FY 2017 and Q1 2018 results.
External view
Analysts at FBN Quest have placed an Underperform rating on the stock. They have a target price of N2.2, which was 16.1% higher than the price of N1.90 as at when the report was written.
Analysts at Afrinvest have placed a SELL rating on the stock.
Our view
Diamond Bank is a SELL in Nairametrics opinion. The stock is currently trading at 9.5 times earnings, far higher than its peers in the tier two space. Poor FY 2017 and Q1 2018 results mean the stock could witness downward selling pressure in the coming days.
Cement Company of Northern Nigeria: SELL
Latest Results: Results for the first quarter ended March 2018 show revenue increased from N4.3 billion in 2017 to N5.3 billion in 2018. profit before tax jumped from N684 million in 2017 to N1.5 billion in 2018. Profit after tax also rose from N513 million in 2017 to N1 billion in 2018.
Pricing
Current Share Price: N29.00
Price-earnings ratio – 9.61x
Price to book ratio – 2.52
YTD Return – 205.26%
One year return– 478.74%
Latest information
The company’s shareholders register will be closed from Monday June 18 2018 to Friday June 22 2018. Qualification date for the dividend is June 15 2018.
External view
Analysts at Afrinvest have placed the stock under review meaning an upgrade of their valuation model is in the works.
Our view
CCNN is a SELL in our opinion. The stock has appreciated by over 200% year to date, making it the best performing stock on the Nigerian Stock Exchange.
At this stage, investors would be better off cashing their gains. The stock is also trading at a year high of N29, and at its rise can no be linked to fundamentals.
This is not a buy sell or hold recommendation. Remember to consult a competent financial analyst or stockbroker if you need help with your investment decisions.
