Nigerian stocks sustained its strong start to the year last week as the main equity index added 3.7 per cent, driven by gains from industrial goods and oil & gas equities. All the sector indexes appreciated during the week.
New entry positions and reinvestment by investors on account of the new year are likely to shape activities in the market in the next few weeks.
“Some investors may also reposition their portfolios ahead of anticipated 2025 full-year earnings and dividend declarations, focusing on stocks with strong earnings potential,” analysts at Meristem Securities had said in their outlook for the week.
“Gains are likely to be driven by renewed interest in fundamentally strong stocks, strategic portfolio adjustments, and targeted buying in counters perceived as undervalued,” they added.
PREMIUM TIMES has assembled some stocks with sound fundamentals, adopting rigorous approaches to save you the risk of picking equities at random for investment.
The pick, a product of an analytical market watch, offers a guide to entering the market and taking strategic positions, with the expectation that selected stocks will record reasonable price appreciation with the passage of time.
This is not a buy, sell or hold recommendation but a stock investment guide. You may need to involve your financial advisor before taking investment decisions.
United Bank for Africa (UBA)
UBA tops this week’s list for its strong fundamentals and for trading below its intrinsic value.
The net profit ratio (NPR) of the lender is 23.8, while the price-to-earnings (PE) ratio is 2.1x. Its relative strength index (RSI) is 64.2.
Mutual Benefits Assurance
Mutual Benefits appears on the pick for trading below its intrinsic value. The NPR of the insurer is 15.3, while the PE ratio is 4. The RSI is 67.2.
Lafarge Africa
Lafarge Africa makes the selection for its sound fundamentals. The company’s NPR is 24.8 per cent, while the PE ratio is 9.8x. Its RSI is 79.6.
May & Baker
May & Baker makes the list for its strong fundamentals. The NPR of the company is 8.7, while the PE ratio is 16.2x. Its RSI is 97.3.
AIICO Insurance
AIICO Insurance makes the cut for its fairly strong fundamentals and for trading below underlying value. The insurer’s NPR is 8.2 per cent, while the PE ratio is 9. The RSI is 63.
