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You can buy this listed company for less N100 million 

There are also stocks that are at the lowest tier with market capitalizations that fall below what you will expect of a company listed in the upper tier of the Stock Exchange. One company holds the unenviable title of being the least capitalized stock on the Nigerian Stock Exchange.

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According to data from the Nigerian Stock Exchange, as at August 16th, 2019, the market capitalization of the entire 170 listed stocks was valued at about N13.1 trillion. Out of these 170 stocks, the big six, made up of Dangote Cement, MTN Nigeria, Airtel, Nestle, GTB and Zenith Bank, have a combined market capitalization of about N8.95 trillion — about 68% of the market capitalization of the exchange. Whenever these stocks sneeze the stock market catches a cold.

Conversely, there are also stocks that are at the lowest tier with market capitalizations that fall below what you will expect of a company listed in the upper tier of the Stock Exchange. One company holds the unenviable title of being the least capitalized stock on the Nigerian Stock Exchange. That stock is none other than Thomas Wyatt Nigeria Plc.

[READ MORE: Beer Wars: International Breweries takes number 2 market share from Guinness Plc]

Market Cap: According to the latest stock exchange data, Thomas Wyatt has a market capitalization of a meagre N92.4 million or $257,000 only. A few months ago, it was worth about half of this amount and valued at just about N46 million.

  • The stock has a year low of N0.23 and is ironically one of the best-performing stocks, after gaining a whopping 82.6%, since it hit bottom in March.
  • Its current share price of N0.42 is currently its year high and has remained that way since July 2019.
  • Its highest share price over the last 5 years was N0.79, last achieved in December 2014. It has not touched this level since then.

What does Thomas Wyatt do? According to information on its website, the company is majorly into paper manufacturing, the printing of books and other stationery items, and manufacturing printers. Some of its products include exercise books, ruled papers, duplicated books, spiral and quarter-bound books, photocopying and typing papers and full complements of envelopes. The company also prints calendars, diaries, toilet rolls, and facial tissues. You may have seen exercise books with the brand name “Apex Mill”, this belongs to them.

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[READ ALSO: Difference between FGN Savings and Treasury Bills]

Who are their customers?: The company claims that its customers include the likes of “Unilever Nigeria Plc, Nigerian Bottling Company, MTN Communications, Flour Mills of Nigeria Plc, Mr. Biggs, College of Medicine, University of Lagos, Obafemi Awolowo University, Corona School Trust Council, Queen College, etc.”  Whether these companies still patronize them is another issue.

Cursory Financial Analysis: According to the company’s 2019 full-year results ended March 2019, Thomas Wyatt reported revenues of N58.1 million, a drop from N86.3 million reported a year earlier. Losses also ballooned to N56.7 million, compared to N98.5 million losses a year earlier. The company is technically insolvent, with about N343 million in negative equity.

How is it still afloat?: Thomas Wyatt remains afloat because of Leadway Assurance, and the Bank of Industry. It also is in business because some of its related parties often give it a lifeline in credit purchases.

It owes Leadway Assurance about N265 million, and the Bank of Industry N185 million (Finance Lease). It appears that it has not paid down the principal and only paid about N18 million in interest and N500k in lease rentals during the year.

Who owns Thomas Wyatt? The company’s majority shareholders are Moorehouse Management Ltd with 22.3% of the equity of the company. It is closely followed by Nova Finance and Security with 10.6%, and Ojukwu Transport with 5%. Nigerians own the rest of the company.

Moorehouse Management invested in the company in 2005 as a core investor, but it appears that the benefits of that deal have not materialized as expected.

[READ FURTHER: Inflation rate, rise and fall explained]

Buying Opportunity? Well, on paper the company is worth N92.4 million; however, it could be worth more than that at true cost. Anyone who buys this company will still need to pay for what you can call a control premium. The company also owns property plants and equipment with a book value of N391 million. It could be worth much more based on market value.

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Who could be interested in buying? Thomas Wyatt is one of the oldest companies listed on the Nigerian Stock Exchange, and it was incorporated in 1948. Acquiring the company shouldn’t be difficult if the price is right and the owners are willing to sell. However, simple things can be quite onerous in Nigeria.

Those interested could be:

    • Existing shareholders who want to take it private.
  • Any private company or private equity firm looking for a reverse listing. This basically means listing on the stock exchange by acquiring an already listed firm.
  • Any group of sharp investment firms looking for a challenge — a company they can turn around.

Need detailed information? Contact us via [email protected]

[READ MORE: Investing in Nigerian Bonds – A Beginners Guide]

 

 

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Nairametrics is Nigeria's top business news and financial analysis website. We focus on providing resources that help small businesses and retail investors make better investing decisions. Nairametrics is updated daily by a team of professionals. Post updated as "Nairametrics" are published by our Editorial Board.

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Market Views

Nike stocks post gains, women’s apparel division grow by 200%

Nike has used the COVID-19 pandemic as leverage to expand its digital business as it reported a surge in its in online sales.

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Nike stocks post gains, women's apparel division grow by 200%

Nike, the most valuable fashion brand in the sports business, saw its stock price rising on Tuesday, as the company reported an 82% surge in online sales and offered an impressive outlook that calls for demand to grow through the holidays.

Nike has used the COVID-19 pandemic as leverage to expand its digital business, and its women’s apparel division grew by nearly 200%. Parents stocked up on back-to-school items, and its business picked up in key markets like China.

READ: Flour Mills and its diverse challenges

Highlights of the results 

First-quarter reported revenues were $10.6 billion, down 1 percent on a reported basis, and flat to the prior year on a currency-neutral basis.

Nike’s direct sales were $3.7 billion, up 12 percent on a reported basis, and up 13 percent on a currency-neutral basis, with growth across all geographies.

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Brand digital sales increased 82 percent, or 83 percent on a currency-neutral basis, with double-digit increases across North America, Greater China, and APLA and triple-digit growth in EMEA.

READ: Unmarked hotels and short-stay apartments report high occupancy rates during COVID-19

Diluted earnings per share for the quarter was $0.95, up 10 percent. Inventory rose 15 percent versus the prior year, but decreased 9 percent versus the prior quarter.

“Our results this quarter continue to demonstrate NIKE’s full competitive advantage, as we strengthen our position in the midst of disruption,” said John Donahoe, President, and CEO, Nike, Inc.

READ: UPDATED: Nigeria received $1.29 billion capital inflows in Q2 2020, down by 78.6%

“In this dynamic environment, no one can match our pace of launching innovative products and our Brand’s deep connection to consumers. These strengths, coupled with our digital acceleration, are unlocking NIKE’s long-term market potential.”

COVID-19 pandemic is also helping Nike’s digital potential. The company disclosed that its digital sales now make up at least 30% of its total quarterly sales, a threshold that Nike had previously aimed to hit in three years’ time.

“Nike is recovering faster based on accelerating brand momentum and digital growth,” CFO Matt Friend stated on Tuesday.

Full details of the results can be found here

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Stock Market

MTN Nigeria records gain, investors profit up by N42 billion

REDSTAREX led 9 Gainers as against 17 Losers topped by UBN at the end of today’s session.

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Global stocks sell-off persists as resurgence of COVID-19 frighten investors 

Nigerian bourse on Tuesday closed its trading session on an impressive note. The All Share Index gained by +0.31% to close at 25,574.35 points as against +0.01% appreciation recorded on Monday.

  • Its Year-to-Date (YTD) returns currently stands at -4.42%. Nigerian Stock Exchange capitalization presently stands at N13.408 trillion.
  • Investors gained N42.09 Billion.
  • Nigerian bourse trading turnover printed positive as Nigerian Stock Market trading moved and gained 33.61% as against +1.36% uptick recorded on Monday.
  • ZENITHBANK, FBNH, and TRANSCORP were the most active to boost market turnover.
    Market breadth ended negative as REDSTAREX led 9 Gainers as against 17 Losers topped by UBN at the end of today’s session – an unimproved performance when compared with the previous outlook.

READ: Nigerian banking stocks ignore red flags, boost Nigeria Stock Market

Top gainers

  • REDSTAREX up 9.80% to close at N3.25
  • TRANSEXPR up 9.33% to close at N0.82
  • MTNN up 2.41% to close at N123
  • FBNH up 2.04% to close at N5
  • DANGSUGAR up 0.83% to close at N12.1

Top losers

  • UBN down 6.54% to close at N5
  • INTBREW down 2.94% to close at N3.3
  • UACN down 1.56% to close at N6.3
  • PRESCO down 0.80% to close at N49.5
  • DANGCEM down 0.22% to close at N134.7

READ: U.S stock futures trade flat, Apple regains $2 trillion market value

Outlook

Nigerian bourse unsurprisingly ended higher amid rising oil prices and high buying pressures noticed in NSE30 stocks like Dangote Sugar, First Bank, and MTN Nigeria.

  • Market liquidity was notably higher as institutional investors increased their stakes on decent stock brands.
  • In spite of the sell-offs in global markets, and the dollar strengthening upward, as Local investors are taking advantage of undervalued stocks across the spectrum
  • Nairametrics, however, envisages caution in selecting stocks, as market indicators show high uncertainty in the coming days.

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Stock Market

Nigerian Stocks immune to high sell-offs recorded in Global Stock Market

UACN led 9 Gainers as against 16 Losers topped by CHAMPION 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 stock started the first trading day of the week on a surprisingly bullish note amid record sell-offs in the global market. The All Share Index gained 0.01% to close at 25,574.35 points as against the +0.16% gain recorded on Friday.

  • Its Year-to-Date (YTD) returns currently stands at -4.72%. Nigerian Stock Exchange market capitalization presently stands at N13.365 trillion.
  • Nigerian bourse trading turnover printed higher as volume climbed up by 1.36% as against the 16.31% plunge recorded on Friday. FBNH, CHAMS, and UBA were the most active to boost market turnover.
  • Market breadth closed negative as UACN led 9 Gainers as against 16 Losers topped by CHAMPION at the end of today’s session – an unimproved performance when compared with the previous outlook.

Top gainers

  • UACN up 5.79% to close at N6.4
  • INTBREW up 3.03% to close at N3.4
  • PRESCO up 1.84% to close at N49.9
  • GUARANTY up 0.20% to close at N25.4
  • MTNN up 0.08% to close at N120.1

Top losers

  • CHAMPION down 10.00% to close at N0.81
  • REDSTAREX down 9.20% to close at N2.96
  • JBERGER down 3.23% to close at N15
  • ACCESS down 0.78% to close at N6.4
  • FLOURMILL down 0.76% to close at N19.65

Outlook

Nigerian bourse ended in a near stalemate amid selling pressures recorded in Brent crude futures at U.S trading session. Nigerian bourse, with the help of NSE30 stocks like MTN, GTBank also brought immunity against significant sell-offs recorded on the global stocks market on Monday.

  • At the time this report was drafted, the Dow Jones Industrial Average (DJI) was down 588.64 points, or 2.13%, at 27,068.78. The S&P 500 (SPX) was down 59.80 points, or 1.80%, at 3,259.67, and the Nasdaq Composite (IXIC) was down 142.45 points, or 1.32%, at 10,650.83
  • The CBOE Market Volatility Index (VIX), a measure of investor anxiety, shot up to its highest level in nearly two weeks.
  • Nairametrics envisages cautious buying as market indicators point to higher uncertainty in the coming days coupled with rising cases of COVID-19 infections at Nigeria’s most important international markets.

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