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Buy/Sell/Hold: Why you should HOLD FBN Holdings stocks

Stocks on our Buy/Sell/Hold list are drawn from the top losers and gainers of the prior week.

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Nigerian stocks, Buy Sell Hold, results

Stocks on our Buy/Sell/Hold list are drawn from the top losers and gainers of the prior week, as well as various analysts’ reports.

Eterna Oil: HOLD

Recent Results:

Latest Results for the nine months ended September 30, 2018, show that revenue increased from N135 billion in 2017 to N205 billion in 2018. Profit before tax, however, fell sharply from N2.9 billion in 2017 to N1.7 billion in 2018. Profit after tax also fell from N2 billion in 2017 to N1.1 billion in 2018.

Price Information

Current Share Price: N5.45
Price to Earnings Ratio: 3.54×
Price to Book Ratio: 0.57
Year to Date Return: 34%
One Year Return: 42.89

External View: None

Our View

Eterna Oil is a HOLD in Nairametrics’ opinion. The stock is trading at a PE ratio largely in line with other companies in the sector such as Total and 11 Plc which are trading at 5 times earnings each. Year to date, the stock is up 34%. Investors already in would be better off holding.

PZ Cussons: SELL

Recent Results:

Results for the first quarter ended August 2018 show that revenue fell from N18.5 billion in 2017 to N15.8 billion in 2018. The company’s losses worsened year on year from N181 million in 2017 to N204 million in 2018.

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Price Information

Current Share Price: N10
Price to Earnings Ratio: 11.89X
Price to Book Ratio: 0.9
Year to Date Return: 51.46%
One Year Return: 56.04%

External View

Analysts at United Capital have a BUY recommendation on the stock. They have a 12-month target price of N20.6 which represents  an 86.4% upside from the stock’s price of N11.1 as at when the report was prepared.

Analysts at FBN Quest have an ‘Underperform’ rating on the stock. They have a target price of N19.1 which represents a potential upside of 91% from the stock’s price of N10 as at when the report was prepared.

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Analysts at Afrinvest have a BUY recommendation on the stock. They have a target price of N15.04 which represents a potential upside of 122.7% from the stock’s price of N22.27 as at when the report was prepared.

Our View

PZ Cussons is a SELL in Nairametrics’ opinion. The company’s results have remained negative in the last two quarters, and have shown no sign of changing.

FBN Holdings: HOLD

Recent Results:

Results for the third quarter ended September 30, 2018, show that interest income dropped from N356 billion in 2017 to N337 billion in 2018.

Profit before tax dropped from N55.4 billion in 2017 to N51.3 billion in 2018. This represents a 7.4% drop year on year. Profit after tax dropped from N45.8 billion in 2017 to N44.9 billion in 2018. This represents a 1.9% decrease year on year.

Price Information

Current Share Price: N7.55
Price to Earnings Ratio: 5.40x
Price to Book Ratio: 0.3
Year to Date Return: 14.20%
One Year Return: 7.20%

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External View

Analysts at United Capital have a BUY recommendation on the stock. They have a 12-month target price of N10.7 which represents a 33.8% upside from the stock’s price of N8 as at when the report was prepared.

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Analysts at Afrinvest have a BUY recommendation on the stock. They have a 12-month target price of N9.89 which represents a 30.1% upside from the stock’s price of N7.60 as at when the report was prepared.

Our View

FBN Holdings is a HOLD in Nairametrics’ opinion, as the stock is trading largely in line with other tier 1 peers such as Zenith Bank which is trading at a PE ratio of 4.1 times earnings and Guaranty Trust Bank which is trading at 5.5 times earnings.

Year to date, the stock is down 14.20%. Investors would be better off waiting for a further price drop before taking positions.

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 [email protected]

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Cryptocurrency

Rich investors are moving cryptos at an alarming rate

Over $1.5 billion worth of Bitcoins have been transferred from one point to another in more than 15 transactions.

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Bitcoin, BTC, cryptocurrency,Cryptocurrencies and its usage in Africa

Wealthy investors have lately intensified their moves at an astronomical rate, with the prevailing price seen at the world’s flagship crypto hovering above $13,000.

At the time of writing, over $1.5 billion worth of Bitcoins have been transferred from one point to another in more than 15 transactions tracked by Nairametrics, thus giving a signal that wealthy investors are definitely up to something.

The most recent price movement captured by Nairametrics showed a BTC whale moving about $34 million worth of cryptos to Coinbase, the world’s most valuable crypto exchange company.

Why you should know: In the crypto-verse, traders, or global investors who own large numbers of BTCs are typically called Bitcoin whales. This means a Bitcoin whale would be an individual or business entity (with a single Bitcoin address) owning around 1000 Bitcoins or more.

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The number of large entities owning BTCs recently reached an all-time high amid Bitcoin’s ascension. By October 25, the number of large entities owning over 1000 BTCs increased to 2,231.

Whales could be anticipating a strong medium to long-term Bitcoin price trend, and are choosing to hold on to BTC in expectation of a bull market.

What this means: much of the recent increase can be attributed to wealthy entities withdrawing their BTC from exchanges. Apparently, this is not new wealth; rather, it represents a change in the way Bitcoin whales are choosing to hold their coins.

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  • That said, it’s critical to note these large entities are on record highs amid last week’s price ascension. Statistics obtained from BitcoinCharts revealed that Bitcoin whale addresses actually control a much higher 7,902,469 BTC, or 42% of the total supply.
  • That brings an affirmative bias that these large entities’ movements are trajectory to price movements at unprecedented levels.
  • This is an indication that more high-net-worth individuals are entering the space to invest in Bitcoin, in expectation of $BTC price appreciation.
  • Bitcoin accumulation has been on a constant upward trend for months. 2.6M $BTC (14% of supply) are currently held in accumulation addresses.

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Stock Market

Total, Nestle, lead Nigerian Stocks to record high

Market breadth closed positive as NESTLE led 43 Gainers as against 11 Losers topped by PRESTIGE at the end of today’s session.

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investors, Bulls gain momentum, as stimulus package lifts global financial markets, Bulls boost global financial market, gold hits 7 years high, Dangote, Tier-1 banks lead the bulls to close Nigerian stock market green

Nigerian stocks were blue hot on Friday, as investors momentarily went bullish on most listed stocks. The All Share Index gained 3.71% to close at 30,530.69 points as against +1.58% appreciation recorded on Thursday.

  • Nigerian Stock Exchange capitalization presently stands at about N16 trillion naira.
    Its Year-to-Date (YTD) returns currently stands at +13.74%.
  • That said, Nigerian bourse trading turnover was very impressive at Friday’s trading session as volumed surged by +115.27% as against -2.68% downtick recorded on Thursday.
  • UBA, ACCESS, and FBNH were the most active to boost market turnover. GUARANTY and STANBIC topped the market value list.
  • Market breadth closed positive as NESTLE led 43 Gainers as against 11 Losers topped by PRESTIGE at the end of today’s session – an unimproved performance when compared with the previous outlook.

Top gainers

  1. NESTLE up 10.00% to close at N1421.7
  2. MOBIL up 9.98% to close at N196.1
  3. BUACEMENT up 9.90% to close at N45.5
  4. TOTAL up 9.25% to close at N129.9
  5. DANGCEM up 3.03% to close at N160

Top losers

  1. PRESTIGE down 10.00% to close at N0.54
  2. NAHCO down 5.41% to close at N2.1
  3. GUINNESS down 3.13% to close at N17
  4. PZ down 2.20% to close at N4.45
  5. ETI down 0.88% to close at N5.65

Outlook

Nigerian bourse was fired up at all cylinders amid falling oil prices across the market spectrum.

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  • NSE30 stocks saw high buying pressures as Total and Nestle recorded maximum daily gains on Friday.
  • Nigerian institutional investors seem to be shifting more of their funds to Nigerian Stocks on the prevailing low returns seen in the Nigerian debt market.
  • Nairametrics, however, envisage cautious buying amid growing uncertainty in Nigeria’s key international market, particularly Europe, where about 40% of Nigeria’s major oil earning comes from.

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Company Results

Seplat declares a total interim dividend of $29 million for shareholders

The Interim dividend of US$0.05 per share will be paid on all the outstanding 588,444,561 ordinary shares of the company.

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Seplat Petroleum Development Company Plc, a leading Nigerian independent energy company listed on both the Nigerian Stock Exchange and London Stock Exchange, has announced the payment of a total $29,422,228.05 as interim dividend to shareholders.

This information is contained in its notification dated 30 October, 2020, which was signed by the Company Secretary, Mr. Emeka Onwuka, and sent to the floor of the Nigerian Stock Exchange today.

The notification partly reads:

“Seplat Petroleum Development Company Plc (“Seplat” or the “Company”), a leading Nigerian independent energy company listed on both the Nigerian Stock Exchange and London Stock Exchange, today announces an interim dividend at a rate of US$0.05 (United States Five Cents) per Ordinary Share (subject to appropriate WHT) to be paid to SEPLAT’s shareholders whose names appear in the Register of Members as at the close of business on 13th November 2020.”

What you should know

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  • The Interim dividend of US$0.05 per share will be paid for all the outstanding 588,444,561 ordinary shares of the company owned by the shareholders of the leading energy company, and this gives a total interim dividend of $29,422,228.05, to be distributed to the shareholders of the company.
  • The Interim Dividend of US$0.05 (United States Five Cents) per Ordinary Share of N0.50k each (subject to appropriate withholding tax) will be paid to shareholders whose names appear in the Register of Members as at the close of business on 13th November, 2020.
  • To enable SEPLAT’s Registrar, Datamax Registrars Limited, prepare for the payment of the interim dividend, the Register of Shareholders will be closed on 16th November 2020.
  • On the London Stock Exchange, the Associated Record Date will be 13th November, 2020, and the Ex-Dividend date will be 12th November, 2020.
  • The exchange rate for the naira or pounds sterling amounts payable will be determined by reference to the relevant exchange rates applicable to the US dollar on 12th November, 2020, and will be communicated by the Company on 13th November, 2020.
  • On or around 7th December, 2020, the interim dividend will be paid electronically to shareholders whose names appear on the Register of Members as at 13th November 2020, and who have completed the e-dividend registration and mandated the Registrar to pay their interim dividend directly into their Bank accounts.
  • Shareholders with dividend warrants and share certificates that have remained unclaimed or are yet to be presented for payment or returned for validation are advised to complete the e-dividend registration or contact the Registrar.

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