Stocks on our Buy/Sell/Hold list comprise our picks from the gainers and losers of the previous week, and various analyst reports.
Here are our stock picks for the week ending 14th June 2018.
NPF Microfinance Bank Plc: HOLD
Latest Results: Results for the first quarter ended March 2018 show that gross earnings increased from N767 million in 2017 to N928 million in 2018. Profit before tax rose slightly from N193 million in 2017 to N208 million in 2018.
Pricing
Current Share Price: N1.65
Price-Earnings Ratio: 5.86x
Price to Book Ratio: 0.73
YTD Return: 32%
One Year Return: 45.26%
Latest Information: The stock was marked down last week following the payment of a dividend of N0.17.
External View: None
Our View: NPF Microfinance is a HOLD in Nairametrics’ opinion. The stock is trading 28.4% below its year high. Last week’s price drop was largely due to a dividend markdown.
Presco Plc: HOLD
Latest Results: Results for the first quarter ended March 2018 show that revenue fell from N7.1 billion in 2017 to N6.5 billion. Profit before tax fell from N5.0 billion to N3.4 billion. Profit after tax fell from N3.9 billion to N2.5 billion.
Pricing
Current Share Price: N73.70
Price Earnings Ratio: 3.06x
Price to Book Ratio: 0.9739
YTD Return: 7.59%
One Year Return: 20.52%
Latest Information: None
External View: Analysts at FBNQuest have placed a Neutral rating on the stock. They have a price target of N85.1 which is a 20% upside from the stock’s price of N70.4 as at when the report was prepared.
Our View: Presco is a HOLD in Nairametrics’ view. The stock is trading at a cheaper PE ratio compared to its peer, Okomu, which is trading at 8.19 times earnings, though Okomu has higher earnings.
Presco is also trading at less than 10% below its year high of N78.
Consolidated Hallmark Insurance: HOLD
Latest results: Results for the first quarter ended March 2018 show that gross premium increased from N1.8 billion in 2017 to N2.1 billion in 2018. Profit before tax fell sharply from N404 million in 2017 to N285 million in 2018. Profit after tax fell from N303 million in 2017 to N209 million in 2018.
Pricing
Current Share Price: N0.28
Price to Earnings Ratio: 3.99x
Price to Book Ratio: 0.358
YTD Return: -44%
One Year Return: -40.39%
Latest Information: None
External View: None
Our View: Consolidated Hallmark Insurance is a HOLD in Nairametrics view.
Though the stock is 44% down from its year high of N0.50 (which should signal a BUY opportunity), Q1 2018 results have shown a decline. If Q2 results take a similar pattern, investors would be better off selling the stock.
Management is also yet to confirm if it will go ahead with a planned share reconstruction.
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.
