Nigerian bourse on Tuesday recorded impressive gains. The Nigerian All Share Index gained by 0.34% to close at 25,413.95 basis points as against +0.07% appreciation recorded on Monday. Its Year-to-Date (YTD) returns currently stands at -5.32%.
Nigerian Stock Market capitalization now stands at N13.258 trillion, as investors gained N45.29 billion
Nigerian Stock Exchange trading turnover closed green as volume moved up by +255.56% as against +120.36% uptick recorded in the previous session. UAC-PROP, ACCESS, and GUARANTY were the most active to boost market turnover.
Market breadth closed positive as ETI led 27 gainers as against 9 losers topped by WAPIC at the end of today’s session – an unimproved performance when compared with the previous outlook.
- ETI up 6.41% to close at N4.15
- NB up 5.41% to close at N39
- UBA up 4.80% to close at N6.55
- UACN up 4.39% to close at N5.95
- STANBIC up 1.25% to close at N36.5
- UBN down 5.66% to close at N5
- PZ down 2.38% to close at N4.1
- MAYBAKER down 2.33%to close at N2.93
- FCMB down 2.27% to close at N2.15
- DANGCEM down 0.67% to close at N134
Nigerian bourse continued its bullish run in spite of prevailing macros that include the surge of COVID-19 caseloads in emerged markets that serve as an important destination for Nigeria’s crude oil and relatively low volatility in the energy market.
Nairametrics envisage cautious buying in the near term as a significant amount of institutional investors remain on the sidelines.
Google fired up, post strong advertising growth
Google fired up on all cylinders as high as 9% in after-hours trading as it smashed many stock analysts’ predictions.
Google parent company Alphabet was fired up on all cylinders. It gained as much as 9% in after-hours trading, after it smashed many stock analysts’ predictions for both revenue and earnings in its Q3 results, showing strong growth in ad revenue amid the ravaging COVID-19 virus attacks.
What you should know
Highlights of Q3 results
- Earnings per share: $16.40 vs $11.29 expected.
- Revenue: $46.17 billion vs $42.90 billion expected.
- Google Cloud: $3.44 billion vs. $3.32 billion expected.
- YouTube ads: $5.04 billion vs. $4.39 billion expected.
- Traffic acquisition costs (TAC): $8.17 billion vs. $7.66 billion expected.
At the time of drafting this report, the world’s tech powerhouse, Google had a valuation of over a trillion-dollar and was trading at $1,567.24 with its Price/Earning Ratio standing at 32.91.
- However, Google’s parent company disclosed its revenue from “Other Bets,” which includes its subsidiaries outside of Google like the self-driving car company Waymo and Life Sciences business – Verily, brought in $178 million compared to $155 million a year ago.
- Meanwhile, Other Bets showed an operating loss of $1.10 billion, up from $941 million a year ago.
What they are saying
The top brass of Google including its CEO, Sundar Pichai, and Wall street’s Ruth Porat, CFO of Google, gave valuable insights on why the most popular search engine company performed extremely well.
“We had a strong quarter, consistent with the broader online environment,” said Sundar Pichai, Chief Executive Officer of Alphabet and Google.
“It’s also a testament to the deep investments we’ve made in AI and other technologies, to deliver services that people turn to for help, in moments big and small.
Ruth Porat, Chief Financial Officer of Alphabet and Google, said,
“Total revenues of $46.2 billion in the third quarter reflect broad-based growth led by an increase in advertiser spend in Search and YouTube, as well as continued strength in Google Cloud and Play.
“We remain focused on making the right investments to support long-term sustainable value.”
Apple drops 4%, iPhone sales slump
Apple stock dropped over 4% in extended trading – trading at $110.45.
Apple the world’s biggest tech company reported its Q4 earnings, showing its iPhone sales slumped more than 20% year-over-year – coupled with no guidance on future earnings led the stock to drop momentarily after results were released.
Also weighing down on Apple shares is the bias that the lack of fiscal Q1 2021 guidance from the world’s most valuable company, means that stock traders and global investors don’t get a hint at how Apple is performing, as regards sales of its iPhone 12 – which went on sale this month.
What you should know
Here’s how Apple did versus analyst expectations via Refinitiv estimates:
- iPhone revenue: $26.44 billion vs. $27.93 billion estimated, down 20.7% YoY
- EPS: 73 cents vs 70 cents estimated
- Revenue: $64.7 billion vs $63.70 billion estimated, up 1% YoY
- Mac revenue: $9.0 billion vs. $7.93 billion estimated, up 28% YoY
- iPad revenue: $6.8 billion vs. $6.12 billion estimated, up 46% YoY
- Services revenue: $14.55 billion vs. $14.08 billion estimated, up 16.3% YoY
- Other Products revenue: $7.88 billion vs. $7.40 billion estimated, up 20.9% YoY
- Gross margin: 38.2% vs. 38.1% estimated
At the time of writing this report, Apple stock dropped over 4% in extended trading – trading at $110.45. The company has a valuation hovering at about $1.972 trillion, making it the most valuable technology company on this planet.
While Apple shares are falling amid the relatively impressive result, it recorded weak sales earning for Apple’s second most valuable market in China. Sales in greater China – which includes Taiwan, Hong Kong, plunged to $7.95 billion from $11.13 billion.
What they are saying
Apple’s CEO, Tim Cook gave deep insights on his company’s product performance, as the Mac. services and iPad posted impressive gains amid the ravaging COVID-19 virus onslaughts.
“Apple capped off a fiscal year defined by innovation in the face of adversity with a September quarter record, led by all-time records for Mac and Services,” said Tim Cook, Apple’s CEO.
“Despite the ongoing impacts of COVID-19, Apple is in the midst of our most prolific product introduction period ever, and the early response to all our new products, led by our first 5G-enabled iPhone lineup, has been tremendously positive.
“From remote learning to the home office, Apple products have been a window to the world for users as the pandemic continues, and our teams have met the needs of this moment with creativity, passion, and the kinds of big ideas that only Apple can deliver.”
Lafarge, Nigerian Breweries, Stanbic IBTC, others top best performing stocks in Q3 2020
Nairametrics reviews the best stocks in Q3 2020, judging by their performance.
Lafarge Africa, Nigerian Breweries, Stanbic IBTC, United Capital, and FTN Cocoa made the list of best-performing stocks in the third quarter of 2020 (July – Sept’20).
The third quarter of the year was a recovery period for the Exchange, as the All Share Index grew by 9.61% to close the gap caused by the negative performance it endured in the first quarter of the year – during the heat of the COVID-19 pandemic. It also recorded a 14.92% positive growth in the second quarter.
As Company stocks is one of the popular means of short-term investments in Nigeria and a look at persistent inflationary pressures; it is imperative to assess the performances of the stocks listed on the exchange during the covid era, to ascertain the profitability of investors in this period.
To determine the best-performing stocks, we looked at the stock prices as of the last trading day in June 2020 and compared to their prices as of the last trading day of September 2020. Here are the top 5:
Lafarge Africa Plc
The Cement manufacturing company grew its stock value by as much as 50% between July and September 2020. As at 30th June 2020, the stock of Lafarge was worth N10 per unit of share but grew to N15 as at the last trading day of September – with a market capitalization of N241.6 billion.
A cursory look at the Q2 2020 financial performance, shows a 5% year-on-year decrease in revenue generated. However, a reduced cost of sales helped improved the company’s gross profit by 10% and a subsequent 78% increase in profit before tax at N19.38 billion.
June 30th – N10
September 30th – N15
Return – 50%
Ranking – First
Nigerian Breweries Plc
The second on the list is the brewery giant, Nigerian Breweries – the makers of Star Lager, Fayrouz, Goldberg, and many other consumables. It grew its stocks by 35.73% from N36.1 as of 30th of June to N49 per share at the end of Q3 2020. The market capitalization also closed at N391.8 billion as at the review period, being the second most capitalized consumer goods firm – only behind Nestle Nigeria.
A look at the Q2 2020 financials, shows that the company endured a downturn, mostly affected by the COVID-induced lockdown, which halted all social gatherings, as it posted a profit before tax of N69.8 million – 99% decline compared to N7.95 billion recorded in the corresponding quarter of 2019.
However, with the lifting of lockdown nationwide, the outlook for the Q3 and Q4 2020 appears to be positive, as investors have shown confidence in the brand, which has translated into a positive stock performance in the quarter.
June 30th – N36.1
September 30th – N49
Return – 35.73%
Ranking – Second
Stanbic IBTC Plc
The third most capitalized bank on the stock exchange is also the third on the list of best performing stocks in Q3 2020, growing its stock by 33.88% from N30.25 per unit of share recorded as of June 30th to N40.5 at the end of trading in September – with a total market capitalization of N449.8 billion.
In the same vein, the Q2 performance of Stanbic IBTC indicates an 11% increase in gross earnings, which permeates into 32.2% increase in profit before tax – from N21.1 billion recorded in Q2 2019, as against N27.9 billion in the review period.
June 30th – N30.25
September 30th – N40.5
Return – 33.88%
Ranking – Third
United Capital Plc
The financial and investment service firm recorded a 30.59% increase in its stock value, as it moved from N2.55 per unit of share as at June 30th to N3.33 as at the end of September. This growth places United Capital in fourth position, as one the best performing stocks between July and September 2020.
The investment firm displayed firm resolve against the effects of COVID-19 in the second quarter of the year – as it posted a profit before tax of N1.5 billion, as against N1.2 billion reported in the corresponding quarter of 2019. This indicates a 22.9% increase in profit.
June 30th – N2.55
September 30th – N3.33
Return – 30.59%
Ranking – Fourth
FTN Cocoa Processors Plc
A unit of FTN Cocoa shares was valued at 20 kobo as at June 30th. However, it grew by 30% to N26 kobo as at the end of trading on 30th September 2020, leaving its total market capitalization at N572 million.
Data obtained from Nairalytics – the research arm of Nairametrics, showed that FTN Cocoa has not released its financials since Q1 2019. However, the cocoa processing company was able to post a positive stock performance in the third quarter of the year to sit fifth on the list.
The company was formerly registered as Fantastic Traders Nigeria Limited, a Limited Liability Company, which was incorporated in 1991. It commenced cocoa processing business in a third-party arrangement (Toll Processing) with Stanmark cocoa processing company limited in 1995. They converted cocoa beans into cocoa butter and cocoa cake/powder, and later extended their activities to Ile-oluji, Cocoa Cooperative etc.
June 30th – N0.20k
September 30th – N0.26k
Return – 30%
Ranking – Fifth
The following stocks make up the rest of the top 10 in descending order:
6. Guaranty Trust Bank Plc
7. University Press Plc
8. Eterna Plc
9. Unity Bank Plc
10. Fidson Healthcare Plc
Explore some Advanced Financial Calculators on Nairametrics
Bottom line: With a double-digit growth in the following stocks, Investors who bought these stocks would be delighted to see their investments appreciate during this period and will look forward to gaining more in the subsequent periods.