If you were a United Capital shareholder in 2024, you had plenty of reasons to smile. The company delivered a Total Shareholder Return (TSR) of 178%, making it one of the best-performing stocks of the year.
This is based on an analysis conducted by Nairametrics Research using the company’s total shareholder returns for the year.
But what does that really mean for you as an investor? Let’s break it down.
How We Got the 178% Return
Total Shareholder Return (TSR) isn’t just about how much the stock price moves. It’s a combination of three things:
- Share price changes – Did the stock go up or down?
- Dividends – How much did the company pay shareholders?
- Bonus shares – Did the company give investors extra shares?
Here’s how United Capital stacked up in 2024:
- The share price started the year at N23 and ended at N20.5. While investors may think the share price fell, they often overlook that this was due to the creation of new shares. In reality, the company’s market capitalization surged by 167%.
- The company paid a total dividend of N1.40 per share, split into:
- N0.90 interim dividend during the year.
- N0.50 final dividend at the end of the year
The real game-changer? A massive 12 billion bonus share issuance, which meant shareholders got extra shares without paying more money.
When you add up all these factors, shareholders ended up with a 178% return on their investment for the year.
United Capital’s Growth Story in 2024
Even beyond shareholder returns, United Capital had an excellent year financially. The company’s total market value jumped 167% to reach N369.6 billion, a sign that investors continue to bet big on its future.
Here are some highlights from their 2024 financials:
- Revenue: N43.43 billion (a slight dip of 5.37%)
- Investment income: N15.56 billion (+82.50%)
- Profit before tax: N30.1 billion (+74%)
- Profit after tax: N24.1 billion (+111%)
- Total assets: N1.7 trillion (+80.60%)
United Capital made most of its money from investment income, fees, and trading gains, showing that its business strategy is working.
Why the share price didn’t soar despite strong performance
If United Capital did so well, why didn’t the share price skyrocket?
The answer lies in the bonus shares. When companies issue bonus shares, they increase the number of shares available in the market.
While that’s great for existing shareholders, it also means that the share price might not go up as much because the earnings are spread across more shares.
That’s why, despite record profits, Earnings Per Share (EPS) dropped 29%, not because the company made less money, but because it now has more shares in circulation.
A look at the share price over the years
If you’ve been holding United Capital shares for a while, you’ve seen incredible growth.
- In 2019, the stock was trading at N0.97.
- By the end of 2024, it had climbed to N20.4, a huge return for long-term investors.
- The stock hit its 52-week high of N23.85 on February 7, 2025, before dipping to N20 on March 3, 2025.
Even though the stock has cooled off a bit in early 2025, the long-term trend still looks strong.
Is United Capital still a good investment?
The numbers suggest that United Capital is in a strong position. The company generates solid cash flow (N25.68 per share), has a decent price-to-earnings (P/E) ratio of 14.93x, and remains one of the most trusted names in asset management.
But as always, no investment is without risk. If you’re a retail investor, here are some things to consider:
- Dividend lovers – If you like a steady income, United Capital pays good dividends and has a strong history of rewarding shareholders.
- Long-term investors – If you’re in it for the long haul, the company’s fundamentals look solid.
- Short-term traders – The stock has shown some volatility, so it may not be ideal for quick flips.
With a 178% total return in 2024, United Capital has certainly proven its ability to create wealth for investors. The challenge now is whether it can keep up the momentum in 2025.
Would you buy, hold, or sell? Let’s see how the market plays out.
