Stocks on our Buy/Sell/Hold list are drawn from the gainers and losers of the previous week, as well as various analysts’ reports.
Here are Buy/Sell/Hold picks for the week ended 24th of August, 2018.
UAC of Nigeria Plc (UACN) Plc: HOLD
Latest Results: Results for the half year ended June 2018 show that revenue dropped from N47.3 billion in 2017 to N36.9 billion in 2018. Profit before tax, however, increased from N1.8 billion in 2017 to N2.1 billion in 2018. Profit after tax also increased slightly from N1.1 billion in 2017 to N1.3 billion in 2018.
Price Information
Current share price: N12.60
Price to Earnings ratio: 22.39X
Price to book ratio: 0.54
Year to date return: -25.44%
One year return: -19.76%
External View
Analysts at FBNQuest have placed an ‘Overperform’ rating on the stock. They expect a 24.5% upside from the stock’s price of N13, as at when the report was written.
Analysts at Afrinvest have a BUY recommendation on the stock. They have a 12-month target price of N26.92, equating to a 100% upside from the stock’s price of N13, as at when the report was prepared.
Our View
UACN Plc is a HOLD in Nairametrics’ opinion. The company has begun taking steps to turn around its most problematic subsidiary, UPDC, and could deliver a better performance compared to the prior year.
UACN is currently trading close to its year low of N12.55 and could dip further in view of current bearish sentiments on the NSE.
Ikeja Hotel: HOLD
Latest Results: Results for the half year ended June 2018 show that revenue increased from N2.7 billion in 2017 to N3.3 billion in 2018. Profit before tax jumped from N115 million in 2017 to N370 million in 2018. Profit after tax also jumped from N81 million in 2017 to N242 million in 2018.
Price Information
Current Share Price: N2.79
Price-Earnings ratio: 9.73x
Price to book ratio: 1.3
Year to Date Return: 56.74%
One year return: 56.74%
External View: None
Our View: Ikeja Hotels is a HOLD in Nairametrics’ view. The stock is trading at a multiple of 9.7 times earnings, far lower than its peer Transcorp Hotels Plc.
The relatively illiquid nature of the stock means that it may be fairly resistant to current bearish sentiments on the NSE.
UAC Property Development Company (UPDC): HOLD
Latest Results: Results for the half year ended June 2018 show that revenue dropped from N2.2 billion in 2017 to N1.2 billion in 2018. Loss before tax stood at N1.5 billion, as against N1.8 billion in the corresponding period of 2017. Loss after tax stood at N1.8 billion in 2018, as against N2 billion in the comparative period of 2017.
Price Information
Current Share Price: N1.71
Price Earnings ratio: None
Price to Book ratio: 0.13
Year to Date return: -38.71%
One Year return: -40.83%
*UPDC’s Price Earnings ratio for the twelve trailing months ended December 2017 is NIL as the company made a loss.
External View: None
Our View: UPDC is a HOLD in Nairametrics’ view, as the stock is down 38.71% year to date. Investors would be better off waiting for a further drop in price before taking a position.
International Breweries: HOLD
Latest Results: Results for the six months ended June 2018 show that revenue increased from N17.4 billion in 2017 to N53.1 billion in 2018. The company made a loss before tax of N5.2 billion in 2018 as against a profit before tax of N252 million in 2017. Loss after tax stood at N2.8 billion as against a loss after tax of N52 million in 2017.
Price Information
Current Share Price: N35.2
Price to Earnings ratio: 36.86X
Price to Book Ratio: 8.3
Year to Date Return: -35.41%
One Year Return: 3.53%
External View:
Analysts at FBN Quest have a Neutral rating on the stock. They have a target price of N47.4, a potential upside of 48.2% from the price of N32 as when the report was prepared.
Our View
International Breweries is a HOLD in Nairametrics’ opinion. Investors would be better off waiting for a further drop by 15% before taking a position. The stock is trading a PE in the same range as other companies in the sector.
