Top 5 stocks in Nigeria based on YTD return; how they made it


The Nigerian stock market has been on a roll since the introduction of the forex window for investors and exporters back in April this year. The Month of May alone has recorded a total gain of about 14.48% as stocks rallied nearly across all major indices.

Best stocks based on returns YTD May 31 2017
Source: Meristem

However, some stocks have gained far more than others and ended up as the best stocks this year so far. Here they are, starting from the 5th best

UBA – 5th

United Bank for Africa (UBA) is the best banking stock this year in terms of total returns in the Nigerian stock exchange. It has gained a whopping 66.67% this year alone as investors take position in the tier one bank. UBA reported a profit after tax of N72.2 billion about 21% higher than the N59.6 billion reported in 2015. UBA has also reported a profit of N22.3 billion in the first quarter of this year compared to the N16.9 billion reported a year earlier. UBA closed at N7.50

Stanbic IBTC – 4th

Ever since Stanbic IBTC sorted out its debacle with the Financial Reporting Council of Nigeria, the obvious path for its stock has been northwards. It followed the settlement with a release of its audited accounts showing it profits rose a whopping 51% to N28.5 billion in 2016. Stanbic Share price has gained about 73% this year alone. Stanbic closed at N26

Fidson – 3rd

Rumours that the leading pharmaceutical company will buy May & Baker has helped propelled the share price to levels not seen since January 2016. The company has since denied the rumoured deal to acquire May and Baker. The company’s 2016 FY profits rose by about four folds to N168 million in 2016. Despite this, it did not declare dividend fanning claims that the spurt in share price rally had everything to do with a potential deal. Fidson closed at N2.28

Airservice -2nd

Aviation company, Airline services started its growth spurt sometime in March. From the first day of March when it closed at N2.78 it has gradually crept up closing the month of May at N4.48. The company is yet to release its 2016 FY results which suggest that the spurt in its share price could be attributed to internal “arms race” taking place within the company. Typically, when a company’s share price is rising without a fundamental justification it is typically that a prominent shareholder is scooping up shares or that there is a potential acquisition in the offing. Closed at N4.48

Oando – 1st

The beleaguered oil company is not one to ride on fundamentals for capital appreciations. It’s more synonymous with relying on losses to drive share price appreciation than profits. It however relies more on internal machinations to trigger a rally in its share price. It is either a majority shareholder buying shares on the back of another complex structured deal or just positioning for another spin off of its subsidiary. If there is one thing Oando is good at it is churning out complex entities that inherit bad assets or take on the very good ones. Whatever the case, Oando has gained a whopping 79.8% this year and is the best stock for 2017 as at May 2017. Closed at N8.45

 

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