Nigerian stocks, Buy Sell Hold, results

Stocks on our Buy/Sell/Hold list are picked from the top gainers and losers of the previous week and various analysts’ reports.

Access Bank: HOLD

Latest results

Results for the half year ended June 2018 show that gross earnings increased from N246 billion in 2017 to N253 billion in 2018. Profit before tax dropped from N52 billion in 2017 to N45.8 billion in 2017. Profit after tax increased slightly from N39.4 billion in 2017 to N39.6 billion in 2018. This represents a 0.5% increase year on year.

Pricing

Current Share Price: N8.00
Price Earnings Ratio: 3.67X
Price to Book Ratio: 0.50
Year to Date: -23.44%
One Year Return: -12.25%

External View

Analysts at United Capital have a BUY recommendation on the stock. They have a target price of N10.6, which indicates a potential upside of 35.9% from the market price of N7.8, as at when the report was prepared.

Analysts at FBNQuest have a ‘Neutral’ rating on the stock. They have a target price of N12.3 which indicates a potential upside of 58.1% from the stock’s price, as at when the report was written.

Our View

Access Bank is a HOLD in Nairametrics‘ opinion. While the stock is trading at a price-earnings ratio lower than the average PE on the exchange, and among its tier one peers, it is trading at 40.5% below its year high. Investors would be better off waiting for a 50% drop from its year high before taking a position.

Dangote Sugar Refinery: HOLD

Latest Results

Results for the half year ended June 2018 show that revenue dropped from N118 billion in 2017 to N80 billion in 2018. Profit before tax dropped from N25.2 billion in 2017 to N19.9 billion in 2018. Profit after tax also fell from N17.1 billion in 2017 to N12.7 billion in 2018.

Pricing

Current Share Price: N14.70
Price to Earnings Ratio: 4.75X
Price to Book Ratio: 1.76
One Year Return: 12.75%
Year to Date: -26.50%

External View

Analysts at FBNQuest have a ‘Neutral’ recommendation on the stock. They have a target price of N19.5 per share, which indicates a potential upside of 40% from the company’s share price of N13.9 as at when the report was prepared.

Coronation Research

Analysts at United Capital have a BUY recommendation on the stock. They have a target price of N21.7 per share. This indicates a potential upside of 56.1% from the stock’s price of N13.9, as at when the report was prepared.

Our View

Dangote Sugar Refinery Plc is a HOLD in Nairametrics’ opinion. The stock is currently trading at 37% below its year high. Investors keen on entering can wait for a further decline to 50% before doing so.

Transcorp Plc: BUY

Latest Results

Results for the half year ended June 2018 show that revenue increased from N34.1 billion in 2017 to N54 billion in 2018. Profit before tax jumped from N4.5 billion in 2017 to N11.9 billion in 2018. Profit after tax also surged from N4.1 billion in 2017 to N10.8 billion in 2018.

Pricing

Current Share Price: N1.25
Price Earnings ratio: 6.43x
Price to Book ratio: 0.77
One Year Return: 7.19%
Year to Date: -14.38%

External Views: NONE

Our View

Transcorp Plc is a BUY in Nairametrics’ opinion. The stock is currently trading at a PE ratio of 6.34 times earnings, much lower than the average PE on the NSE which is 9.3 times earnings, as well as UACN, its peer in the conglomerate space, which is trading at 19.85 times earnings.

The stock is also trading at 57.6% below its year high of N2.55 per share. H1 2018 results show the company is likely to have a much better full-year result compared to the prior year.

Onome Ohwovoriole has a degree in Economics and Statistics from the University of Benin and prior to joining Nairametrics in December 2016 as Lead Analyst had stints in Publishing, Automobile Services, Entertainment and Leadership Training. He covers companies in the Nigerian corporate space, especially those listed on the Nigerian Stock Exchange (NSE). He also has a keen interest in new frontiers like Cryptocurrencies and Fintech. In his spare time, he loves to read books on finance, fiction as well as keep up with happenings in the world of international diplomacy. You can contact him via onome.ohwovoriole@nairametrics.com

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