Buy/Sell/Hold, Guaranty Trust Bank, Nigeria Stock Excahnge

Stocks on Nairametrics Buy/Sell/Hold list are drawn from the top gainers and losers of the previous week, as well as various analyst reports.

Guaranty Trust Bank: HOLD

Recent Results

Results for the nine months ended September 30, 2018, show that interest income dipped from N82.3 billion in 2017 to N75.6 billion in 2018. Profit before tax, however, rose from N48.9 billion in 2017 to N54.6 billion in 2018. Profit after tax also increased from N41.8 billion in 2017 to N46.6 billion in 2018.

Price Information

Current Share Price: N37.95
Price to Earnings Ratio: 5.66x
Price to Book Ratio: 2.1
Year to Date Return: 10.2%
One Year Return: -11.41%

External View

Analysts at United Capital have a ‘Buy’ recommendation on the stock. They have a 12 month target price of N46.70, which represents a potential upside of 22.9% from the stock’s price of N38 as at when the report was prepared.

Analysts at FBNQuest have an ‘Overperform’ recommendation on the stock. They have a target price of N45.7 which represents a potential upside of 18.3% from the stock’s price of N38.70, as at when the report was prepared.

Analysts at Afrinvest have an ‘Accumulate’ rating on the stock. They have a 12-month target price of N44.26, which represents a potential upside of 14.5% from the stock’s price of N38.65, as at when the report was prepared.

Our View

Guaranty Trust Bank is a HOLD in Nairametrics’ opinion. The stock is trading within a PE ratio of peers such as FBN Holdings which is trading at 5.9 times earnings and Zenith Bank which is trading at a PE ratio of 4.25 times earnings.

While the stock may not rally sharply, investors would be better off maintaining their holdings, till the conclusion of the presidential election.

Dangote Flour Mills: HOLD

Recent Results

Results for the nine months ended September 2018 show that revenue dipped from N100.2 billion in 2017 to N83. 2 billion in 2018. Profit before tax fell from N18  billion in 2017 to N4.4 billion in 2018. Profit after tax also dropped from N13 billion in 2017 to N3 billion In 2018.

Price Information

Current Share Price: N8.35
Price to Earnings Ratio: 7.40X
Price to Book Ratio: 1.04
Year to Date Return: 21.9%
One Year Return: -46.53%

External View

None

Our View

Dangote Flour Mills is a HOLD in Nairametrics’ opinion, despite poor 9M 2018 results. Year to date, the stock is up 21%, out performing the NSE All Share Index.

Investors would be better off watching the outcome of the presidential elections before changing positions.

The general consensus is that the market would witness a bounce if the elections are peaceful, irrespective of the winner. The NSE has closed in positive territory in 9 out of the last 10 trading sessions.

Disclaimer

Please consult a financial adviser before making an investment decision.

Coronation Research
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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