Nigerian stocks, Buy Sell Hold, results

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

Dangote Cement: HOLD

Recent results

Results for the third quarter ended September 30, 2018, show that revenue for the company increased from N603 billion in 2017 to N685 billion. Profit before tax increased from N220 billion in 2017 to N247 billion. Profit after tax also increased from N154 billion in 2017 to N158 billion.

Price Information

Current Share Price: N192
Price to Earnings Ratio: 20X
Price to Book Ratio: 4.2
Year to Date: 1.2%
One Year return: -23.09%

External View

Analysts at United Capital have a ‘Buy’ rating on the stock. They have a 12-month target price of N235, which represents a potential upside of 20.6% from the stock’s price as at when the report was prepared.

Analysts at FBNQuest have an ‘Overperform’ rating on the stock. They have a target price of N274.5 which represents a potential upside of 40.9% from the stock’s price of N194.9 as at when the report was prepared.

Our View

Dangote Cement is a HOLD in Nairametrics’ opinion.

While the stock is trading at a PE ratio nearly 4 times higher than CCNN, the stock is trading close to its 52 week low. Possibilities of a 50% dip in price which would be a good entry point, are rare at this stage, especially as earnings season draws close.

Newrest ASL: HOLD

Recent Results

Results for the nine months ended September 30, 2018, show that revenue increased by 42% from ₦2.8 billion in 2017 to ₦4.2 billion in 2018. Profit before tax jumped from ₦189 million in 2017 to ₦1 billion in 2018.

Price Information

Current Share Price: N7.15
Price to Earnings Ratio: 3.99X
Price to Book Ratio: 1.40
Year to Date Return: -9.5%
One Year Return: 38.22%

External View

None

Our View

Newrest ASL is a HOLD in Nairametrics’ opinion. The company is in the process of delisting. Precedence from other delisted companies indicates that minority shareholders would most likely be offered a buy out price.

This could lead to a slight rally in the stock’s share price. While this is profitable, from a speculative basis, this does not qualify it as a BUY.  The stock is likely to trade in a somewhat volatile manner, once terms and conditions are announced.

NEM Insurance: HOLD

Recent Results

Results for the half year ended September 30, 2018, show that gross premium written increased from N11 billion in 2017 to N12 billion in 2018. Profit before tax dipped slightly from N2 billion in 2017 to N1.89 billion in 2018. The drop in profit before tax was, however, minute, moving from N1.69 billion in 2017 to N1.6 billion in 2018.

Price Information

Current Share Price: N2.39
Price to Earnings Ratio: 4.51X
Price to Book Ratio: 1.29
Year to Date Return: -11.5%
One Year Return: 31.32%

External View

None

Our View

NEM Insurance is a HOLD in Nairametrics’ opinion, despite a year to date decline on the NSE, far lower than the All Share Index.

The stock was the best performing stock last week, gaining 43%, and will need to decline significantly to warrant an entry.


Disclaimer

Please consult your stockbroker or financial adviser before making a Buy/Sell decision.

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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