Cheap stocks for strategic positioning: Why you should pitch your tent with fundamentally sound stocks

The stock market last week closed on a bearish note, occasioned by profit taking in MTN, Dangote Cement, BUA Cement and 30 other stocks, thereby creating new entry opportunities for discerning investors.

Most of the Q2 2022 results released performed beyond market expectation as year on year growth is recorded in some companies, while some recovered from the losses recorded the previous year. Without a doubt, these impressive result is going to drive positive vibration in the market when investors start looking in the direction of these stocks.

Except for companies that will release audited reports with interim dividends, most of the results have been released. Before the end of August, we expect the following dividend paying stocks to have released their results: Zenith Bank, GTCO, UBA, Access Bank, Fidelity Bank, Stanbic IBTC.

Prices of most stocks have come down to their year low, thereby creating new entry opportunities for discerning investors.

We have always advised that investors to take position in fundamentally sound stocks as they stand the test of time.   To mention a few among cheap stocks with strong fundamentals and uptrend potentials, the following may be considered for strategic positioning:

ZENITH BANK

Zenith Bank is currently trading at N21.25 and has touched a high of N27.5 and N18.90 in the past 52 weeks.

It is trading 22.73% away from its 52 weeks high of N27.50, which implies an uptrend potential of about 23% for the share price of the bank.

Going by its Book Value of N42.37, relative to its current price of N21.25, Zenith Bank is very cheap and embedded with growth potentials.

GTCO

The share price of GTCO is currently trading at N20.40 and it has touched a high of N30 and a low of N18.90 in the last 52 weeks.

It is trading 32% away from its year high of N30, which implies an uptrend potential of 32% for GTCO.

The Book Value of N30.88, relative to the current price of N20.40 is a confirmation that GTCO is underpriced.

ACCESS HOLDINGS

The share price of Access Holdings Plc is currently trading at N8.80. In the past 52 weeks, the stock has touched a high of N10.60 and a low of N8.45.

It is trading 16.98% away from its 52 weeks high of N10.60, which implies an uptrend potential of about 17% for Access Holdings.

With the Book Value of N30.84, Access Holdings is considered very cheap, relative to its current share price of N8.80.

FBNH

The share price of FBHN is currently trading at N11. Within the last 52 weeks, the share price of the big elephant has touched a high of N12.90 and a low of N7.20.

It is trading 14.73% away from its year high of N12.90, which implies an uptrend potential of about 15% relative to its year high of N12.90.

With the Book Value of N24.51, relative to its current price of N11, FBNH is underpriced.

UBA

UBA is currently trading at N7.05 with a 52 weeks high of N8.85 and a low of N6.7. It is trading 20.34% away from its 52 weeks high of N8.85, implying an uptrend potential of about 20% for UBA.

Considering its Book Value of N24.14, relative to its share price of N7.05, UBA is grossly underpriced. A position in UBA has uptrend potentials.

FLOUR MILLS

Flour Mills is currently trading at N32.45 with a 52 weeks high of N41.45 and a low of N27.5.

It is trading 21.75% away from its 52 weeks high of N41.45, implying an uptrend potential of about 22% for Flour Mills.

Considering its Book Value of N47.78, relative to its share price of N32.45, Flour Mills of Nigeria is considered cheap and has uptrend potential.

GUINNESS

Currently trading at N84, the share price of Guinness has touched a high of N110 and a low of N29.05 in the past 52 weeks.

Guinness has an uptrend potential of 23.64%, relative to its 52 weeks high of N110.

PRESCO

Currently trading at N158.40, the share price of Presco with a year high of N200 and year low of N72.6.

There is an uptrend potential of 20.80% in the share price of Presco, relative to its 52 weeks high of N200.

NIGERIAN BREWERIES

The share price of Nigerian is currently trading at N47.15 and it has touched a high of N78.5 and a low of 39.9 in the past 52 weeks.

It is trading 39.94% away from its 52 weeks high of N78.5, suggesting an uptrend potential of about 40% for Nigerian Breweries.

Source: Cheap stocks for strategic positioning: Why you should pitch your tent with fundamentally sound stocks – StocksWatch (stocksng.com)

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