The stock market last week closed on a positive note with 0.35% growth, bringing the All Share Index and Market Capitalisation to 59,206.63 points and N32.237 trillion respectively. Year to date, the market has returned 15.52%.
In a stock market review with the MD/CEO of Global View Capital Limited, Aruna Kebira, the following were discussed:
• The market last week grew marginally by 0.35%. What is the outlook for the new week?
The prices in the market have fully reflected all the information in the market place and the market is left oscillating and to brood.
The market is currently waiting for another stimulus to either continue with the rally we experienced in the month of June or travel southwards.
Most of this information includes and is not limited to the appointment of a substantive CBN governor and the Minster of Information.
The market may not be in the rally mood as we speak but it is also not ready for the admittance of the bears. We may be experiencing marginal gains from week to week but I do not see the market reversing to a loss position.
Mind you, the earnings season is also around the corner and the market will factor these expectations in the pricing of some stocks, especially those that have proven from quarter to quarter of their growth capability.
• What is driving the price of Skyway Aviation?
Skyway Aviation released its Q1 2023 earnings and the turnover revved up by 32% while the middle line experienced a 3,523% growth.
Earnings per share increased from 1k to 19k, meanwhile, its Q4 2022 eps is 21k. The market is excited that just in the first quarter of 2023, the company is almost doing what it did last year.
The market rewards good performances, which is what is happening to this stock.
• Is FTN Cocoa a good buy at N1.90?
FTN Cocoa has gained up to 500% since the rally in the stock started. I am seeing a situation where the price will stagnate and may likely decline.
The facility gotten by the company has not started making any impact on the operations of the company, the reaction we are experiencing in the price of the stock is just futuristic and since the price has enjoyed so much appreciation, it may likely see a reverse action.
• What are the possibilities in First Bank, Guinness, and Learn Africa?
The big elephant is expected by the market to start to write back its previous provision for NPLs as the crude oil market is experiencing a price higher than $80.
The rise in its price is not a function of the quality of the dividend it pays out. The price will look upward as the whole market looks up.
Guinness financial year end is June and the month is ending this week. But while we wait for their moratorium to be exhausted, the market will look expectantly to its Q4 earnings and the attendant dividends.
At N80, the stock is trading close to its 52-week high price of N 87.90. For dividends, the stock is good to go.
• How attractive is Presco at N178?
Presco has never disappointed the market in terms of earnings growth and dividend declaration. But it is only worrisome why at the end of the second quarter in 2023, Presco is yet to release its Q4 2022, Q1 2023, and Q2 2023 is almost due.
In their corporate action dated May 8, 2023, Presco promised that the Q4 2022 and the Q1 2023 earnings reports will be filed with the NGX on May 25 and 26, 2023 respectively.
And the reason they gave for non-compliance is the consolidation of Siat into the company’s financial statements.
Let’s keep our fingers crossed and wait to see the quality of the soup Presco is cooking for its shareholders.
The stock during this past rally appreciated to N180 but has settled down to N178.00
Its 52-week high price is N 183.00. But we saw most stocks setting new 52-week high prices and Presco is not excluded from that list.
Therefore, for good absolute dividends, Presco is good to go at this price.
• What are the stocks to watch?
Nigerian Breweries, Guinness, Presco, MTN, and WAPCO