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Business & Finance

Weekly Economic & Market Commentary

By Abuh JonathanPosted on Posted in Business & FinanceTagged , , No Comments on Weekly Economic & Market Commentary

Last week in Nigeria, the DMO conducted its NTB auction for March, which was oversubscribed due to strong demand. Foreign trade decreased in Q4’22 due to a decline in import trade, but increased by 31.8% YoY. Nigeria’s composite PMI sank to 44.7 in February, ending a 32-month expansion sequence, largely due to cash shortage and fuel shortages. The Nigerian equities market closed bullish, while the naira appreciating in the parallel market. In the US, Silicon Valley Bank collapsed, and the latest job numbers showed that US employers hired more workers than expected in February. The FED will consider these circumstances in their upcoming meeting on whether to hold or raise interest rates.

Stock Pitch – Dangote Sugar Refinery Plc

By Solomon Sele AyebawanaemiPosted on Posted in Business & FinanceTagged , , , , , , No Comments on Stock Pitch – Dangote Sugar Refinery Plc

We recommend a BUY on DANGSUGAR based on our target price of N26.31. This representing a potential 72.0% upside on the closing price of N15.30 as of 14th December, 2022.
Year-to-date (YTD), DANGSUGAR has dropped -10% compared to +13.54% and -5.4% for the NGX-ASI and the NGX-CONSUMER GOODS index respectively. Due to this, the stock is trading at its 52-week low of N15.30 per share, creating a value opportunity for investors.

UNITED CAPITAL PLC: 9 MONTHS-2022 PERFORMANCE REVIEW AND STOCK RECOMMENDATION

By Solomon Sele AyebawanaemiPosted on Posted in Business & FinanceTagged , , , , , No Comments on UNITED CAPITAL PLC: 9 MONTHS-2022 PERFORMANCE REVIEW AND STOCK RECOMMENDATION

United Capital Plc has seen steady growth in both top and bottom lines over the years, and we expect both to continue to grow at double digits over the next five years. The company’s Return on Equity (ROE) has averaged over 30% in the past 5 years. This is one of the highest among publicly listed financial service companies and highlights the company’s strong value creation for its shareholders. We recommend a buy for the stock based on our findings and the future prospects of the company. Our blended target price of N15.10 suggests a potential upside of 20.8% compared to the current share price of N12.50 (24th October, 2022). The target price was arrived at by using a weighted average of 65% for the DDM method and 35% for the comparable method of valuation.

The company also has the following market value ratios:

P/E ratio: 6.7X (FY-21 EPS: N1.88)
Forward P/E: 5.2X (FY-22 EPS: N2.41)
Dividend yield: 12% (last dividend reported: N1.50)
P/B ratio: 2.55X (Book value: N4.9)

Fidson Healthcare PLC H1-22 Performance Review

By Ailende EdnaPosted on Posted in Business & FinanceTagged , , , , 5 Comments on Fidson Healthcare PLC H1-22 Performance Review

Currently, the local drugs manufacturers are faced with an intense competition from imported products and multinational companies. For instance, 70% of the drugs consumed in Nigeria are imported. Also, almost all the local manufacturers source their active pharmaceuticals ingredients or raw material through importation. The preceding suggests that they are merely purchasing drugs and repackaging them for use. These account for the major challenge in the pharmaceutical industry in Nigeria. Though, Fidson is currently working to expand into Active pharmaceutical production (API). Other constraints, will be infrastructural challenges such as inconsistent energy, weak technology, scarcity of forex and high taxation etc.

Dangote Sugar Refinery H1-22 Performance Review

By Solomon Sele AyebawanaemiPosted on Posted in Business & FinanceTagged , , , , , 1 Comment on Dangote Sugar Refinery H1-22 Performance Review

Dangote Sugar Refinery PLC (DANGSUGAR) recently released its H1-22 financial performance, showing top line and bottom line growth of 40.5% y/y and 60.6% y/y, respectively. In this report, one of our trainees at the GA Academy 2.0 analysed the company’s financial performance and update our outlook for the rest of the year.

Nigeria’s inflation rate hits 19.64% in July 2022, the highest in 17 years

By Solomon Sele AyebawanaemiPosted on Posted in Articles, Business & Finance, EconomyTagged , , , , , No Comments on Nigeria’s inflation rate hits 19.64% in July 2022, the highest in 17 years

An examination of the NBS inflation data shows that this is the highest since September 2005 when the inflation rate hit 24.32% year-on-year. On a month-on-month basis, the headline inflation rose by 1.82% in July 2022. This is the same as the rate recorded in June 2022 (1.82% m/m). In our view, higher energy prices and continued depreciation of the local currency against the US Dollar were the key drivers behind this uptick.

Fundamentals of Investing: An Emergency Fund

By Adebowale AterePosted on Posted in Business & FinanceTagged , , , 8 Comments on Fundamentals of Investing: An Emergency Fund

It is important that you see yourself as a company with a structure from earning money, to saving it, to budgeting for expenses and then investing. There should be room for liquidity first. The first step of creating an emergency fund is to try to estimate what your monthly expenses are. Your yearly rent should be factored too, divided into 12 and added to that estimated monthly expense, if you want to go overboard, you can assume you would be leaving the current place you stay in and add expenses for an agent fee or other house expenses associated with getting a new place. Divide this by twelve too and add it to the initially estimated expense.

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