Stock Market Review: December 19, 2022

The Nigerian stock market last week closed on a bullish note with 0.89% growth, occasioned by renewed buy interest by smart investors.

Year to date, the market has returned 15.45% with the All Share Index and Market Capitalisation at 49,316.29 points and N26.861 trillion respectively.

In a stock market review with the MD/CEO of Global View Capital Limited, Aruna Kebira, the following were discussed:

Excerpts:

•             The stock market last week closed on a positive note with 0.89% growth week on week. What is the outlook for the new week?

This new week fortunately  is the second to the last week of the month and of the year. The market has been behaving true to analyst prediction of the Santa Claus rally and the effect of the end of the year actions of Portfolio Managers.

The market is still ticked to close on a positive note even this week in fulfillment of the above predictions. If you have notice that most of the SWOOT ( Stocks Worth Over One Trillion Naira capitalisation) stocks have been on the side line, but within these remaining two weeks of the years, we shall  see good actions and positioning that will lift the ASI further to close the year on a positive note

•             Learn Africa grew by 28.48% last week. How attractive is the stock N2.12?

Learn Africa is being compensated by the market for their performance in the last Q2 2022 earnings release . Also remember that the price was stagnant at N1.65 for a while before moving up to N2.12.

The kind of market we have these days, this movement in the price of Learn Africa is sufficient to  attract profit taking. The further movement in the price of the stock now depends on the market momentum surrounding its demand.This is evident in the decline of its price by 1k from N2.13k to N2.12k during the week under review.

Meanwhile its 52 weeks high is N2.66 and it has 52 weeks low of N1.17 which signifies that it still has an upward potential of 25%

•             What is driving the price of PZ, Cornerstone Insurance, and Coronation Insurance?

The upward movement in the price of PZ may be a surprise to market watchers and analysts as it continues to set new highs week on week. The declaration of N1.01 dividend of PZ and the good outing in their Q1 2022 has been the reason behind this movement.

But most market participants have been wary of their yearly ritual of disposal of  assets to make up their account of which absence would throw their books into a loss position.But the market always has a mind of its own and  if has decided to discountenance the flaws of PZ and reward the price anyway.

The movement in the price of Cornerstone Insurance is strictly the run of play in the market as their last quarterly performance is not particularly fantastic. Their turnover was flat and there was a decline in their eps from 10 to 7k. The market punished the price down to N0.46 and the price is just recovering.

The price of Wapic on the other has been at N0.34, meanwhile their performance in the last Q3 earnings release shows a growth in their bottom line of of 185% from -2.96k to 2.93k.

The market will at least bring the price up to N0.50 while awaiting their next corporate action. The 52 weeks high price is N0.56.

•             Why is Academy Press, AXA Mansard and Geregu Power trending down?

AXA Mansard started the week at a price of N1.99. closing at N1.83k, this is not unconnected to their Q3 2022 earnings release that showed a decline of their eps from 40k to  17k representing a decline of  57.5%

Geregu has not find its feet in the market after listing. The market is cautiously waiting for their next corporate action to properly price the stock. Its price has been on the reverse due to that factor. Their Q4 2022 will either make or mar the price.

The movement in the price of Academy is speculative. The price in the penultimate week traded from N1.27 to N1.34. and was stagnant throughout the first four trading  days of last week before it declined on Friday.

Their performance in their last Q2 2022 is not too commendable as the company declined from eps of 33k to 29k

•             What are the possibilities in Zenith, Fidelity, Fidson, Wema Bank and FBNH?

Zenith has remained one of the most liquid stocks on the floor of the exchange. It is observed that the rates in the money market has started to decline and market participants are of the believe that the attendant effect of that on the capital market would be positive. Therefore momentum has entered into the market and has started affecting the price of Zenith. Even at the current price, Zenith is still promising.

Fidelity has always been trading below its intrinsic value during ordinary market periods. Their Q4 will surely spring a surprise to the market and the price will respond accordingly.

The last time I checked, Wema Bank still remains the only stock that has undergone share reconstruction and are still standing strong. That singular reason has made Wema Bank impressive any day to me.

FBNH will surprise the market in their Q4 and in their dividend declaration, watch out for it.

•             What are the stocks to watch?

Nestle under N1000 is a good buy.

To end the year, we will see movements in NGX, NB, Presco and Okomu, Seplat and GTCO.

Source: Stock Market Review: December 19, 2022 – StocksWatch (stocksng.com)

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