Nigerian bourse in spite of prevailing protest by many Nigerian Millenials ended the past week bullish.
The Nigerian All-Share Index and Market Capitalization both appreciated by 0.86% to close the week at 28,659.45 and N14.980 trillion respectively. Investors gained N127.61 Billion.
- A total turnover of 1.955 billion shares worth N22.978 billion in 22,844 deals was traded this week by investors on the floor of the Exchange. This is in contrast to a total of 3.140 billion shares valued at N35.372 billion that exchanged hands last week in 35,099 deals.
- The Financial Services industry (measured by volume) led the activity chart with 1.648 billion shares valued at N18.824 billion traded in 13,050 deals; thus, contributing 84.29% and 81.92% to the total equity turnover volume and value respectively.
- The Conglomerates Industry followed with 99.313 million shares worth N87.823 million in 553 deals.
- The third place was the Consumer Goods, with a turnover of 60.570 million shares worth N991.189 million in 3,269 deals.
- Trading in the top three equities namely United Bank for Africa Plc, Guaranty Trust Bank Plc, and Zenith Bank Plc. (measured by volume) accounted for 885.515 million shares worth N15.881 billion in 6,308 deals, contributing 45.30% and 69.11% to the total equity turnover volume and value respectively.
- The NSE All-Share Index and Market Capitalization both appreciated by 0.86% to close the week at 28,659.45 and N14.980 trillion respectively.
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- ETERNA PLC. up 34.99% to close at N4.90
- INTERNATIONAL BREWERIES PLC. up 12.92% to close at N5.33
- CADBURY NIGERIA PLC. up 12.59% to close at N8.05
- GUINNESS NIG PLC up 12.33% to close at N16.85
- LAFARGE AFRICA PLC. up 10.88% to close at N18.85
- TOTAL NIGERIA PLC. up 10.00% to close at N 112.20
- PRESCO PLC up 8.93% to close at N65.90
- UNION DIAGNOSTIC & CLINICAL SERVICES PLC up 8.33% to close at N0.26
- MAY & BAKER NIGERIA PLC. up 8.33% to close at N3.25
- NASCON ALLIED INDUSTRIES PLC up 7.88% to close at N13.00
- E-TRANZACT INTERNATIONAL PLC down 26.38% to close at N1.73
- PORTLAND PAINTS & PRODUCTS NIGERIA PLC down 10.31% to close at N2.00
- CONSOLIDATED HALLMARK INSURANCE PLC down 8.11% to close at N0.34
- ROYAL EXCHANGE PLC. down 7.41% to close at N0.25
- CUTIX PLC. down 5.81% to close at N1.62
- AXAMANSARD INSURANCE PLC down 5.67% to close at N1.83
- CUSTODIAN INVESTMENT PLC down 4.76% to close at N5.00
- FIDSON HEALTHCARE PLC down 4.63% to close at N3.50
- ARDOVA PLC down 3.61% to close at N12.00
- GLAXO SMITHKLINE CONSUMER NIG. PLC down 3.45% to close at N5.60
Nigerian bourse ended positive W/W amid mixed oil prices as COVID-19 raging onslaughts infected over 38 million people globally.
- Trading activities turned relatively impressive W/W amid the prevailing macro, showing the high intensity of protests by Nigerian youths clamoring for police reforms.
- The Nigerian inflation rate surged to 13.71% (year-on-year) in September 2020, indicating a 0.49% point difference when compared to 13.22% recorded in August 2020, thereby temporarily weakening the buying pressure of top financial-based stocks.
- Nairametrics envisage cautious buying amid rising COVID-19 caseloads globally.
List of Cryptos expected to outperform many financial assets in 2021
A list of cryptos expected to do very well in 2021 has been unveiled by a renowned crypto expert.
Widely respected crypto trader, Michaël van de Poppe recently unveiled the list of cryptos expected to do very well in 2021 amid the prevailing bullish run in the Crypto verse.
He started by mentioning Polkadot (DOT) and looking at levels where investors can buy on dips.
“We do see these retests at $15. That was one of the levels I discussed. Another one is this $13-level which is lower timeframes and then we’ve got this area around $10.50,” he said.
Polkadot protocol connects private and public chains, oracles future technologies, and permission-less networks allowing such independent networks to share information and transactions through the Polkadot relay chain,
Van de Poppe expects the next leg of the bull run to catapult DOT to his targets at $25, $29, and $45.
In addition to Polkadot, the analyst says he’s also bullish on smart contract platform Cardano (ADA), blockchain for enterprise solutions Zilliqa (ZIL), hybrid blockchain platform ICON (ICX), high throughput blockchain Elrond (EGLD), and interoperable blockchain network Cosmos (ATOM).
Cardano is a type of blockchain that permits people to receive and send funds.
- ADA coin is the name of the cryptocurrency.
- It uses the Cardano blockchain and it also allows people to design smart contracts just like Ethereum.
Elrond is a type of blockchain architecture, created to facilitate a 1000-fold cumulative improvement in the execution of speed.
Its architecture combines a secure Proof of Stake (PoS) algorithm facilitating unlimited scalability.
Zilliqa is a type of cryptocurrency that focuses on making blockchains more scalable and much faster; It uses sharding technology to simplify the consensus process so that blockchains like Ethereum can provide fast transaction processing successfully.
Another solid crypto on the crypto expert’s radar is Celer Network (CELR). He says the layer-two scaling platform can potentially rise to $0.035, representing a potential return of 400% from its present value of $0.007.
Last but not least is chainlink on the bias it has more room for upsides as its still upcoming crypto and has a solid fundamental;
“Chainlink itself has a very big market share of the oracle niche. Other oracles are just starting up their first,” Poppe said.
Chainlink is a blockchain that is designed to bridge the space between blockchain technology-based smart contracts (created by ETH), and other user programs.
Analysts pick Nigerian stocks Warren Buffett may likely buy
Financial market experts talk on what Nigerian stocks Warren Buffet may likely consider, based on his unique principles.
Warren Buffett’s strategy as regards investments has earned him the popular nickname the “world’s greatest investor.”
The global investment community holds the 90-year-old man with so much high esteem when his successful investment strides is considered and the fact that he is now worth about $88.4 billion, and seats on the boards of so many blue-chip companies.
Buffet has long believed in the value-based investing model, as he only invests in companies that exhibit solid fundamentals such as strong earning power, the potential for continued growth, and most importantly, selecting those with low or no debt.
Consequently, Nairametrics has sought the opinions of selected financial market experts on what Nigerian stocks the world’s most powerful investor may likely consider, based on his unique principles.
Angela Aya, Head, Institutional Sales at Alonati in an exclusive interview with Nairametrics spoke on key insights Buffett usually looks out for when selecting stocks.
“Warren Buffet’s investment philosophy centers around traditional yet intricate qualities like company debt profile, profitability, historical performance, exposure to commodities, product offerings, and historical dividend payouts.
“He is considered a value investor focusing on high dividend-paying blue-chip companies that show robust earnings characterized by strong balance sheets holding investments over the long term,” Aya said.
She elaborated on the impressive performance of the Nigerian Stock market in relation to the value they bring in the long haul by stating;
“Despite the Nigerian All Share Index outperforming the rest of the world in 2020, Nigerian stocks are relatively cheap from a purchasing power parity standpoint.
“Therefore, in a long-term strategic value investment play, bellwether stocks that offer stability, show profitability, and are resistant to systemic shocks will be the picks. They may not be trendy or might seem out-right boring, but they are reliable and proven to outperform given time. “
Adetayo Teluwo, a Portfolio Manager at one of Nigeria’s most valuable firms spoke on key metrics accustomed to Warren Buffet’s investment style;
Teluwo said, “I will focus on the long term, adopt a buy-and-hold mentality and prioritize blue-chip dividend-paying stocks that have proven their worth over decades.
Since I do not have bottomless pockets, I will make out time to shortlist based on ROE, D/E, and a blend of perceived ‘intrinsic value’
ROE = Net Income ÷ Shareholder’s Equity
Debt-to-Equity Ratio = Total Liabilities ÷ Shareholders’ Equity
Following Buffett’s investment principle, Adetayo went further by revealing the type of Nigerian stocks he would select. He said;
“According to Warren, if you aren’t thinking about owning a stock for ten years, don’t even think about owning it for ten minutes.
“If I had the conviction of Warren, these will be my top stock picks:
“Julius Berger, UBA, Zenith Bank, GTBank, Custodian, NAHCO, CHI Plc, NEM, Jaiz Bank, WAPIC, Unilever, GSK, MANSARD, Dangote Sugar, Afrinsure”
Silas Ozoya, President/CEO, SUBA Capital adds up to our remarkable respondents as he discloses that Nigeria’s stock market’s most liquid sector would be on Buffett’s top list, not forgetting his love for consumer staple stocks;
“Banking stocks for a start would be his first pick because he has a history of investing in financial institutions.
“So, he would go with stocks like Zenith Bank, GTBank, and FCMB because of profitability in the case of Zenith. Cutting edge technology in the case of GTBank, and versatile banking products in the case of FCMB.
“Warren Buffet is also big with daily consumables and beverages. So, he would go with the stocks of Nigerian Breweries Plc, Dangote Sugar, and Guinness Nigeria Plc.
“I’ve been following Warren Buffet’s investment strategy for a while and three things I’ve noticed are that he says the money would always exchange hands, financial institutions would always make money, and people would always consume daily consumables.”
- It’s key to highlight the rarity of Warren Buffet’s tenets in selecting stocks on the account that he has remained relatively consistent over many decades.
- Still, it remains critical for readers to understand that applying Buffet’s strategy takes a whole lot of discipline and patience.
- However, the few who have followed the founder of the world’s biggest conglomerate, (Berkshire Hathaway) on applying his analytical investment tools have had no regrets in the long term.
Netflix gains 17% after beating investors expectation
Netflix for the first time ever passed the 200 million subscriber mark and had an impressive reserve of $8.2 billion in cash.
Netflix’s share price bounced about 17% higher after it beat market expectation, powering the video streaming stock to close high after adding more customers than expected and revealed it no longer needs debt in building its entertainment empire.
The positive upbeat guidance on free cash prompted bullish remarks from Wall Street analysts, though some questioned how much of the subscriber growth was pulled forward.
Stock traders increased their buying pressure on Netflix stock because of the surprisingly strong growth, as well as news that Netflix balance sheets are solid enough for Netflix considering share buybacks. Shares jumped 17% percent to $586.34 in recent trading Wednesday.
Netflix for the first time ever passed the 200 million subscriber mark and had an impressive reserve of $8.2 billion in cash.
COVID-19 pandemic has aided Netflix’s business, forcing people in spending more time indoors coupled with curbing other traditional entertainment options like movie theaters and concerts.
Netflix added 25.9 million customers in H1, 2020, and ended up adding 36.6 million customers in all – a record.
“Investors come out of the fourth quarter incrementally more bullish on the potential of a powerful developing shareholder return story for Netflix in the coming years,” Evercore ISI analyst, Lee Horowitz wrote in a note to Bloomberg News.
Analysts at J.P. Morgan Securities said the company is likely to begin share buybacks in the second half of the year.
Quick fact: Netflix is an American streaming company that allows subscribers to watch movies, documentaries, different popular TV shows, and many more through internet-connected hardwires.
Stephen Innes, Chief Global Market Strategist at Axi in a note to Nairametrics also spoke on the impressive gains sighted in the $259 Billion valued company;
“Earnings reports also underpinned equity sentiment. Netflix rose 16% after noting its subscriber numbers increased by a record 37 million in 2020. Serenely, it seems lockdowns and TV go hand in hand.
“A testament to the maximum policy overdrive, investors wasted little time getting their feet wet after Janet Yellen espoused by the Biden “go big” policy approach to repair the economic damage caused by the pandemic, which also highlights the importance of helping small businesses and the unemployed.”
What to expect: The Stock market is seeing through longer lockdowns on the premise that COVID vaccinations will lead us out of the pandemic quickly and had helped triggered significant buying pressure on stocks like Netflix taking advantage of reduced social mobility in play