Based on prior prices, volume data, dividend payout and other fundamentals which include company’s growth, revenues, earnings, management and capital structure, the following stocks are likely to appreciate in price this week:
Dangote Cement Plc: is the most successful brand of the Dangote group, the biggest quoted company in West African region as well as the only company in Nigeria on the Forbes Global 2000 companies. In Nigeria, it has four (4) plants and several terminals. The Obajana plant in Kogi (the largest in terms of capacity), Benue, and Ibese plants, all of which has a combined capacity of 20.25 million metric tonnes per annum. The 4th line has been added to the existing Obajana making a combined capacity of 23.25 MMTPA. There are other cement plants in seven (7) different African countries as well as cement terminals. Tiger Brands, a South African Consumer Goods firm, has acquired 63% of Dangote Cement Plc.
These new plants are now generating jobs and prosperity in those countries. The blue chip has confirmed by the fact that it was ranked as sector leader in the Building Materials sub-sector of the Nigerian Stock Exchange in terms of its stock price and consistent mouth-watering dividend payout over the years. Its impressive performance was linked to its innovative means of manufacturing and distributing products, huge financial investments in developing high-performance products and in the provision of services that matched and surpassed international standards.
Financial Performance: In its audited result, its revenue rose from N386.177 Billion in the preceding year to N391.639 Billion, translating to an increase of +1.4%. Profit before tax slide marginally from N190.761 Billion previously to N184.688 Billion, a decrease of -3.2%. Similarly, its profit after tax also slumped by -20.7% from N201.198 billion to N159.501 billion.
However, the drop in distributable profits (i.e. Dividend from N7.00 per share to N6.00 per share) was the main reason for the fall in absolute terms and much of this was attributed to tax charges incurred because Gboko and Obajana production lines 1 & 2 were now out of their tax holiday. Consequently, a mouth-watering dividend of N6.00 per share was appropriated.
Trading Statistics: Current Market Price is N165.00 kobo; Share in Issue = 17,040,507,405 shares.
In its third quarter result 2015, its Gross Earnings rose from N310.214 billion in the preceding year to N365.450 billion, translating to an increase +17.81%. In the same vein, its profit before tax grew from N154.053 billion previously to N166.914 billion, an increase of +8.35%. Similarly, its profit after tax also leaps from N140.477 billion previously to N157.993 billion, an increase of +12.47%. Growth in profit was achieved despite increases in administrative expenses, selling and distribution expenses and finance cost.
The broker recommendation is to “BUY” Dangote Cement Plc shares. The broker is impressed with the audited result, which revealed that revenue were ahead of market expectations. Growth in gross earnings is driven by aggressive sales and consumers brands preference.
2. ZENITH BANK PLC: one of the new generation banks churning out impressive results yearly on the Nigerian bourse. The Bank was incorporated as a private Limited Liability on 30 May, 1990 as Zenith International Bank Limited. It commences business operations in June 1990. Its name was changed to Zenith Bank Plc on 20 May, 2004 and subsequently listed on the Stock Exchange in 2004.The principal activity of the Bank is the provision of banking and other financial services to corporate bodies and individual customers. It was recently listed on London Stock exchange and the cross border listing has impacted positively on its stock price, branding and position in the industry.
It’s issued and paid-up capital consists of 31,396,493,786 billion ordinary shares of 50 kobo each. The Bank has a shareholding base spanning a broad spectrum of the society and major shareholders are Jim Ovia (8.75%) and Stanbic Nominees (6.91%).
The Group posted an above average performance in its audited result as it churned out a good result in all indices. In its audited report, its Gross earnings rose from N351.470 billion in the preceding year to N403.343 billion, translating to an increase of +14.8%. Similarly, its Profit after Tax leaps from N95.318 billion in the preceding year to N99.455 billion, an increase of +4.3%. A dividend of N1.75 kobo per share was appropriated, same as last year.
Its current price resurgence was due to its impressive third quarter 2015 profile where it’s Gross Earnings leaped by +23.06% from N273.738 billion previously to N336.853 billion. Similarly, its profit before tax also grew from N86.816 billion in the preceding year to N104.052 billion, which translates to an increase of +19.85%. In the same vein, its profit after tax also rose by +16.95% from N71.046 billion to N83.087 billion. With this trend, another mouth-watering dividend is inevitable at year end.
3. Fidson Healthcare Plc: The Company was founded in 1995 and has becoming a leading player in the pharmaceutical landscape in Nigeria.
It engages in the manufacture and distribution of pharmaceutical products in Nigeria, and by all accounts has broken barriers along its path to building a successfully managed business/brand and from an analyst points of view, the stock is as solid as a rock.
It operates in the therapeutic market segments. Its portfolio includes anti-infective, anti-arthritis, endocrinology, gastro-intestine, anti-retroviral, anti-malaria, anti-diabetic, cardiovascular, anti-depressant, analgesics, chemotherapy, psychiatry, haematinics, cough expectorants among many others where they are undisputable leaders in the market.
It operates factories, where manufacturing activities are carried out while its wholly owned subsidiary, Fidson Products Limited, engaged in the production of personal products.
Financial Performance: The Company releases its full year 2014 result which shows a significant improvement over the previous years’. It reported a modest growth in revenue of +5.2% from N9.247 billion previously to N9.725 billion.
Similarly, its pre-tax profit increased from N249 million to N870 million, which translates to about 250% increase. In the same vein, its profit after tax leaped by 307.7% from N154.980 million in the preceding year to N631.825 million while its earnings per share (EPS) rose by 223.1% from 13 kobo per share previously to 42 kobo per share.
It grows its gross margin by 7% from N5.1 billion to N5.4 billion while it’s operating profit increased by 5% with operating margin remaining at 15% of revenue.
In its third quarter 2015 result, its turnover slumped by -18% from N7.510 billion previously to N6.160 billion. However, its profit before tax grew by +2% from N685.825 million previously to N696.298 million.
In the same vein, its profit after tax also rose by +2% from N466.361 million to N473.483 million. Trading statistics: Current market price is N3.10 kobo. 1 Year High price= N3.90 while 1 Year low price= N2.79 kobo. EPS is 0.42122 and PE Ratio is 7.60.
4. Berger Paints Plc: The Company was incorporated in 1959 as British Paints (W.A.) limited and was converted to a public limited company in 1973. Its shares were quoted on the Nigerian Stock Exchange in 1974. Robbialac Nigeria Limited is the only subsidiary of Berger Paint plc.
The company is engaged in the manufacturing of Decorative and Industrial Paint, Marine and Protective Coatings, Automobile /Vehicle Refinishes and allied products. The company is regarded as a trailblazer in the Paint Manufacturing sector. It has acquired technologically advanced production machines which have impacted positively in its operations and efficiency.
Flagship Brands: Decorative paints include Texcote, Luxol and Super star and are available in unlimited range of colours; with protective ability. PROCOL is an insect repellant paint formulated primarily to eradicate mosquitoes and cockroaches form the environment.
It is however safe for Humans and Domestic Pets. Industrial coatings are protective paint used as coatings for all manufacturing equipments and machines. It protects the items from rust and scratches.
Automotive/Vehicle Refinishes Paints are brand as Autolux. Car paints includes Solid and Metallic Paints, Primers and Vanish, Auto base range includes the Base and Cryl Primer, fillers clear and hardener etc.
There is also a bergernol wood preservative. Finally, there is Berger Colour world where a dream colour can be produced instantly.
The company is committed technologically to produce paints of high and customized quality to their numerous clients.
Financial Highlights: In its audited result, it’s Profit after tax slides to N148.808 million from N257.580 million in its preceding year, translating to a decrease of -42.2%.
However, its Gross Earnings rose by +13.7% from N2.710 billion previously to N3.082 billion. Consequently, the company doles out a final dividend of 75 kobo per share.
It price resurgence is its impressive performance in the third quarter 2015 financial profile where it recorded positive result in all indices. In it, its revenue leaps by +52.41% from N1.412 billion in the preceding year to N2.152 billion.
Similarly, its profit after tax quantum leaps from N161.375 million previously to N206.299 million, translating to an increase of +27.84%.
Trading Statistics: 1 Year High price= N11.36 k; 1 Year Low price =N8.00 k; Current Price =N9.79 K.
5. Vitafoam Nigeria Plc: The Company was incorporated on 4th August, 1962 as a private Limited and became a public company in 1978 when it was listed on the Stock Exchange. In 2008, it established a subsidiary in Ghana for sale and marketing of its products.
It owns 90% of Vita foam Ghana Limited and fully owned Vitapur Nigeria Limited incorporated last year. It is consolidating in its core area of business through the introduction of innovative products and services. It’s issued and fully paid up capital stood at 819 million ordinary shares of 50 kobo each.
A leading manufacturer of flexible polyurethane and reconstituted flexible foam products like mattresses, cushions, pillows, upholstery, carpet underlay and automotive products. It is also a key player in the manufacture of technical foam products for specialized and diverse applications in consumer, transportation, farming as well as Oil and Gas sector.
Main brands are- Galaxy, Vita Supreme, Vita Super, Twill, Gazelle and Jumbo. Spring Mattresses and other products such as Sofa bed and Profile pillows are also part of its offerings.
Financial Performance: In its audited result, its gross earnings rose significantly by +2.29% from N16.338 billion in the preceding year to N16.712 billion.
Its profit before tax also rose to N709.722 million from N629.785 million, an increase of +12.69%. Similarly, its profit after tax also appreciated from N410.313 million previously to N435.595 million, translating to an increase of +6.16%.
A dividend of 30 kobo per share and 1 for 5 bonus was proposed for sharing amongst its numerous shareholders from 30 kobo per share appropriated last year.
In its third quarter result, its turnover rose by +3.74% from N13.343 billion previously to N13.843 billion. However, its profit after tax slide by -26.75% from N457.796 million to N335.329 million.
Market Statistics: current price= N5.33 kobo; 52 weeks High Price= N6.49 k; 52 weeks Low price= N3.25 k; P.E= 10.70 while EPS is 0.53186.
BY DENNIS OKONNE