In addition to the stock recommendations shared on this blog, you can now follow my weekly digest for up-to-date analysis of NSE All-Share Index, top market-moving news and how to better manage and grow your portfolio with some of my trade ideas.

Weekly Performance:

The NSE All-Share Index and Market Capitalization depreciated by 2.57% to close the week at 34,136.82 and N17.838 trillion respectively. Of all the market indices, only the Insurance sector closed higher, by 0.51%.

Twenty-one (21) equities appreciated in price during the week, lower than sixty-nine (69) equities in the previous week. Fifty-five (55) equities depreciated in price, higher than twelve (12) equities in the previous week, while eighty-five (85) equities remained unchanged, higher than eighty (80) recorded in the previous week. (Source: NSE)

Continue reading “NSE All-Share Index Weekly Digest and Trade Ideas”

The NSE market is currently bleeding as investors rush to book profit on their winning stocks. This is a normal pullback and I think you should see this as another round of buy opportunity before the market finds support.

The overall outlook remains positive, the bull is not over, so take advantage of this healthy correction to prepare your portfolio for take-off; this time, buy more of high yielding dividend stocks.

One of the stocks I am mopping up gradually, before the bull returns, is Lasaco Insurance Plc.

Lasaco Assurance PLC provides life and general insurance services, which includes motor, bond, contractors-all-risk, fire, burglary, aviation, marine, general accident, life, pension schemes, engineering, and oil and gas.

Fundamentals

Lasaco Assurance is one of the few profitable businesses in the insurance of sector; the company generated a net premium of N4.8 billion in the 9-month of its current financial year, which 20.7% higher than N4 billion in the previous comparable year. Out of the total premium earned, it paid a claim and underwriting expenses of N2.065 billion and N2.082 billion respectively (that’s N4.14 billion). While these core insurance expenses are 47% higher than N2.8 billion paid in 2019, due to an unusual claim expense of N1.4 billion between July-Sept 2020, it is still well below the N4.8 billion income earned.

Continue reading “1 Penny Stock That Could Soar If The Bull Returns”

The NSE all-share posted its largest daily gain of 5% in more than 5 years on 12th, November 2020 which triggered a 30-minutes halt of all the stocks for the first time since the Circuit Breaker was introduced in 2016. At the end of the week, the index appreciated by a whopping 12.97% to close the week at 35, 037.46 and N18.3 trillion market cap.

So far, the index is up by 30.53% on a year to date with NSE industrial index leading the pack followed by the NSE insurance and banking index.

If you are yet to discern the fundamental driver of the bull run, refer to my post on why now is the best time to buy stocks and 3 sure stocks you should buy in this new bull.

I emphasized the fact that the low-interest-rate environment occasioned by CBN’s policies in the last 6 months to 1 year is bullish for stocks. Besides, I think the bull may push the NSE all-share to its 2017 high of 40,000 basis – which means we still have at least 10% additional run before I consider a larger sell-off.

One of the supporting factors is the near zero rates on short-term, medium and long-term bill which now prints at 0.04% (from 0.34%), 0.15% (from 0.50%), and 0.30 (from 0.98%) respectively. Even at this unattractive rates, subscribers bid, as at the last auction, on 90-days, 182-day and 364-day was N99.9 billion, N92.2 billion and N411.1 billion, amounting to N603.2 billion.

What’s surprising to me was when the CBN made the allotment, it sold N19.8 billion for the short term, N10 billion for the medium and N138b for the long-term – that’s N167.8 billion out of N603.2 billion, the question is what happens to the N435.4 billion that was unallotted?

Continue reading “How Far Can NSE All-Share Index Go? Plus 3 Stocks to Watch.”

Despite the pandemic and decline in GDP growth numbers, the Nigeria stock market is up by 14% and 35% on year to date and 6 months respectively. Some sectors have no doubt accounted for this big move; finance, health and consumer stocks.

If you have missed the rally or have recently taken profit on your biggest stock winners, here is one consumer stock that deserves your attention right now:

Nascon Stock

NASCON Allied Industries PLC provides food products. The Company products salt, vegetable oil, tomato paste, and seasoning products. NASCON Allied Industries serves customers in Nigeria.

Continue reading “1 Stock Poised to Pop in 60-90 Days”

Make no mistake, trading the stock market isn’t all about buying low, sell high, at times I make more money buying high and selling higher. But the only setback here is that you can only adopt this strategy in a confirmed bull market; a trend that reflects positive sentiments.

Now that treasury bill has finally crashed below 1% with stop rate on 91-day, 182-day and 364-day hovering around 0.34%, 0.50% and 0.98%, there is no doubt the bull will get stronger in coming months.

And if you are looking for a good stock to jump into at ceiling price, leverage on growing positive sentiments among institutional investors after a solid Q2 number, Flourmill Nigeria stock should be on your watchlist.

Flour Mills of Nigeria PLC provides food and agricultural products and services. The Company offers flour, noodles, pasta, oil and spreads, and sugar, as well as feeds, fertilizers, and logistics and support services. Flour Mills of Nigeria serves customers in Nigeria.

I had put a buy rating on this stock in January 2020 before the Covid-19 outbreak. This weighed on the expected rally as investors flee the NSE market to safe-haven assets. But I think the stock is back on track to my target but this time, straight to its 2018 high.

Fundamentals.

In its latest Q2 2021, the company reported a revenue of N355bn, which is 31.2% higher than N271bn generated in the previous comparable period. After accounting for direct and indirect expenses, profit before tax and after-tax expanded by 69% and 68.3% to N14.6bn and N9.9bn respectively.

Continue reading “1 Breakout Stock You Can Still Buy Before Year End.”

We all want to work less and still earn more money to pay our monthly bills. This is a dream everyone looks forward to as one inch closer to retiring age but the hard truth is your savings in the bank is the least asset to make that a reality. In this guide, I’d help you scale the hurdle using my personal investing experience.

Since the beginning of the year, I had deliberately tried and tested the idea of investing for a living just to see if it’s actually workable and from my discovery, this isn’t rocket science.

We live in a country where inflation is the biggest threat to savings and pension isn’t in any way considered reliable sources of income for retirees. The only way to stay afloat outside your 9-5 job is to build an investment portfolio you can start living off.

Here are few simple steps you can take to put yourself in a better position as Nigeria investor:

Estimate your annual expenses

How much do you spend on personal and/or family upkeep per month? This is a basic question you need to provide an answer to and it’s so funny that a lot of folks ignore this figure. Understanding your monthly expenses lets you plan your expected income so you’d know whether you need to do more or are already within your standard of living.

Continue reading “How to Earn a Living Off your Investment”

With the uncertain times of 2020, what strategy can you trust when it comes trading the stock market?

Note: This article was put together before the #EndSars protest.

The stock market goes up and down on any little news and things are more uncertain than ever. This is why you need to learn my tactics of picking the right stocks going forward.

On Sept 15th, 2020, I shared 2 unstoppable cheap penny stocks to buy which were FCMB and UCAP at the recommended market price of N2.03 and N3.01 respectively. It’s now 32 days and both stocks have appreciated by 15% and 20% to N2.35 and N3.63.

These are growth figures that beat our current inflation numbers of 13.22% and have outperformed Treasury Bill rates of 0.16% (pro rated on an annualized rate of 2%).

On the 26th, September 2020, I also shared banking stock that was on a clear path to appreciating to a multi-month of N30, a lot of people actually shared their objections and why the stock may fall as they thought the sentiments on NSE index was largely bearish. Well! the stock which is GTB did test the N30 and is trading above that psychological level.

The most recent stocks to buy are Zenith Bank and Dangote Cement. Both stocks exhibited a bullish potential that is not far from institutional activities; the banking stock is already up by more 19.3% from the market price of N18.05 while Dangote Cement currently selling for N150, up by 4.1%

If you missed these opportunities before the market rally, don’t worry! I am about to share my practical steps to spot stocks like this before they appreciate more.

Continue reading “How to Pick the Right Stock for Trading.”

As investors flock to the stock market for alternative high-yield opportunities, here is one stock you should buy as much as you can next week on a pull-back. The reason I am so convinced this stock will do well is that it actually meets the elusive combination of sustainable inflation-beating dividend yield of 14%+ with more room to appreciation when it finds support at one of its key moving averages.

As a growth investor, one might wonder if the rally in NSE all-share index has come to an end following 2-days of continuous sell-off with 0.46% decline on Friday.

To answer this question, let’s look at the general market index on a monthly so we can get a clear picture of where the index is going, up or down.

The NSE all-share closed Friday’s trading session at 28,415.31 basis point and as you can see on the chart above, MACD is still on very fresh bullish crossover which means, the short term run isn’t over – we may see another rally after a healthy correction.

Continue reading “Buy This Stock Next Week To Pocket 14%+ Cash Dividend.”

Following the massive run stocks have mounted in the last two weeks, it’s normal for the market to correct on profit-taking. But here is the good news, the correction in stock prices witness today offers another opportunity to buy into the dip before All-Share Index reverses back to an uptrend. After all, a lot of analysts believes the low-interest rate that had forced money managers to seek better returns from the stock market will likely remain at that level for a long period.

And as N567bn worth OMO bills matures next week, a slice of this fund should find their way to the stock market.

Going by my predictions, the bulk of the cash invested into the equities market will no doubt chase high-yielding dividend stocks.

Aside from dividend stocks, I’d also advise anyone that has some idle cash to look into agric-stocks that are benefiting from the current pandemic and government policies via increased local demand.

Continue reading “Got Money to Trade? 1 Stock You Should Buy Before Market Rally.”

From September (the day I shared a strong fundamental and technical reasons you should start buying Nigeria stocks), the stock market has added more strength to its index – now up by 3.87% (from 25,978 basis to 26,985). Besides, the 2.53% bullish run in the last 5 days has pushed the market index into the positive region on a year-to-date – NSE ASI is now up by 0.54%. (Let’s pop champagne!!).

But before you buy into the hotties, take your time to understand the reason the market is bullish at this critical time the world is battling a pandemic.

Like I shared in the previous stock recommendations, CBN’s latest monetary policy stance is the reason rates on fixed income instruments are at their all-time low – savings deposit now earns 1.15%, 365-day treasury bill is between 2-3%, while returns on 2-year and 3-year FGN Bonds are in the low range of 4.13% and 5.13%, respectively.

All these paltry returns are in no way close the inflation rate (last reported to be 13.22%) and if you are still considering these options, your money is losing value.

For smart money managers, it makes more sense to hunt for alternative opportunities that offer better returns. This summarizes the reason we are seeing the return of capital in the stock market but you know what? it’s only a few stocks that will attract this new inflow – High-yield Dividend Stocks with Good Fundamentals.

A few weeks ago I recommended UCAP as a stock to watch. The stock has appreciated from N3.01 to N3.33 with more upside in the coming months. As a top to my picks, here are 2 must-own safe stocks to add to your portfolio in the new bull market.

Continue reading “2 Must-Own Dividend Stocks for the New Bull Market.”

The banking stocks seems to have benefited most from the price appreciation this week, this is not unconnected to the availability of liquid stocks in the sector – stocks you can easily buy today and sell off without worries – which is no doubt a major factor fund managers look for before selecting potential stocks to invest.

According to NSE weekly report, a total turnover of 1.567 billion shares worth N20.559 billion in 18,396 deals was traded this week by investors on the floor of the Exchange, in contrast to a total of 1.139 billion shares valued at N12.692 billion that exchanged hands last week in 17,109 deals.

Here is the point: The Financial Services industry (measured by volume) led the activity chart with 1.178 billion shares valued at N9.180 billion traded in 9,900 deals; thus contributing 75.14% and 44.65% to the
total equity turnover volume and value respectively. This tells us that most funds are invested in the banking, insurance and financial related stocks.

Why? I think the recent CBN monetary policy, which has shot the windows of opportunities in the fixed income market, is leaving everyone with no option than to buy stocks. Funds that would have been invested in fixed deposits, treasury bills and bonds are being channelled into fundamentally sound, high-yield dividend stocks – and financial stocks are receiving the highest patronage as evident in the NSE weekly report.

While the banking sector index is down by 15.23% on a year to date, quarterly, monthly and weekly data (which are up by 7.28%, 3.67% and 3.59% respectively) are reflecting the expected bullish run on CBN’s policy directives. Since banks are now lowering their minimum savings deposit rate to 1.15% per annum (10% of the new MPR of 11.5%), their cost of funds should also go down to reflect the recent changes, hence push net interest income.

Although this may not rub off on all banks, I think the big tier banks that already have low-cost fund and effective loan risk management policies will benefit most from this trend. One of the banks to watch going forward is GTB.

Continue reading “Yes! GTB Stock Will Appreciate to N30”

Now that savings deposit rates and treasury bill are at an all-time low of 1.5% and 2.5% respectively, here are helpful ideas for you to grow your idle cash between now and end of 2020: ignore the market volatility, limit the way you watch your stocks every day, the up-and-down swings can make you exit the market at the wrong time. The temporary market gyration is a normal occurrence, after all, no stock moves in a straight line.

Last week, I posted 2 stocks that are about to appreciate and offer impressive return more as we wrap up Q3. This time, I see a big run on some of the big cap stocks on the NSE market.

With NSE all-share index down by 4.5% on a year to date basis and up by 38% and 1.4% in the last 6 and 1 months respectively, I think it’s makes more to show you the market on a monthly chart.

Below is the NSE all-share index in the last 6 years:

After a strong correction that lasted for 2 years, the NSE all-share seems to be showing a possible bullish run that might take the index to 30,000 basis in the coming months. The MACD cross over that aligns with point (D) on the chart tells us what’s next.

Continue reading “Why Now is the Time to Buy Nigeria Stocks”

When you buy the stock of a company, how do know if you are actually trading or investing? This is a big question everyone looking to profit from the stock market should answer before placing their next trade.

Investing isn’t the same as trading. This a fact that had helped me build a separate stock market portfolio. When a stock goes down or up in 10, 20 or 30 days on a row, I don’t touch my equity investment portfolio rather I buy more units to increase my annual ROI as long as the fundamentals of the company remain intact but if the same suffix on my trading portfolio, I make sure a sell order is immediately triggered to cut my loss (as long as the stock falls below my acceptable support level.)

Trading, on the other hand, involves buy and selling of stocks frequently for capital appreciation. The goal is to generate returns that beat the NSE all-share index. You profit from stock market trading when you master the art of buying at a lower price and selling at a higher price within a short period – which could be in days, weeks or months.

Last week, I ran a check on some of my stock market trainee’s account, only to discover that they didn’t know why they bought a company’s stock, that’s why they can’t control their emotion on a slight share price fall.

How do you know if a stock is good for investing?

Since investing is a buy and hold strategy, it means the stock I buy should possess the qualities of a great business with solid fundamentals like:

• Consistent year on year growth in sales/revenue, profit and cash flow.
• Competitive advantage from brand monopoly, innovation or high switching cost. A company that meets these criteria should post an average net profit margin of at least 10% in the last 3-5 years.
• Conservative debt and high-interest cover.
• Must be undervalued relative to its market price.
• Consistent in paying a dividend for at least 7 – 10 years.

Continue reading “Should I Trade Or Invest in GTB Stock?”

Investing in the stock market for capital appreciation is not as straightforward as you might think. It requires both a fundamental analysis of the company you are buying but more importantly, sentiment analysis.

The past 1 year has been one of the most volatile periods on record, with the benchmark NSE all share losing 5-6% of its value on a year to date basis. In fact, this year has undeniably taught short term investors how fruitless it is to try to predict stock price movements with fundamentals.

I hope you are reaping from the capital appreciation on Law Union and Rock after I recommended the stock – click here to see my analysis.

A stock that’s cheap may remain cheap for a long time so don’t get caught in the trap of adopting only fundamental analysis if you are seeking capital appreciation from penny stocks but rather use a little of fundamental and more of technical analysis, price action and sentiments.

Yesterday, I decided to scan the stock market for momentum value penny stocks that have high relative strength, posted improved fundamentals and still on track to appreciate further between now and end of the year.

Here are my 2 top picks:

FCMB

FCMB Group Plc provides financial services including micro-lending, asset management, stock-broking, trusteeship and custodial services, foreign exchange, personal banking, corporate and commercial banking, investment banking and transaction banking products delivering cash, trade and liquidity management solutions to entities.

Fundamentals:

FCMB released a stellar result that beats analysts” expectations; a lot of us had expected a lower top and bottom line but in the bank’s Q2 book, here are the highlight of key figures:

• net interest income increased from N38,6b to N45.3b.
• net fees and commission income declined slightly, on higher charges, to N9b (from N10b reported in the previous comparable period).
• profit after tax increased from N7.5b to N9.7b.
• EPS also prints at 49k against 38k.

Price Performance and Technical Analysis

In the last 365 days, the stock has appreciated by 30.97% with 6 and 3 months trend up by 34.44% and 18.7%. This is a clear departure from bearish performance witnessed among the bank’s peer and I think that the recent downward review in savings deposit rate will reduce FCMB’s cost of funds, hence spur the bank’s FY 2020 result.

The stock looks cheap at a PE ratio of 2.03 and a Price to Book Value of 0.18. With its 50-day SMA above its 100-day and 200-SMA and market price clearly above averages, FCMB remains a good buy between N1.9-N2.03

United Capital (UCAP)

United Capital Plc is a financial and investment services company. The Company focuses on investment banking, asset management, trusteeship, securities and insurance. United Capital provides services to corporations, governments, high net worth individuals, institutional and retail investors across Africa.

Continue reading “2 Unstoppable Cheap Penny Stocks You Should Buy Now.”

Insurance stocks are the least followed stocks in the Nigerian stock market. But did you know that if you peruse the list of local penny stocks that doubled on a year to date basis, you will find one fairly priced insurance stock that is up by 106% with more room for capital appreciation.

In November 2019, I made a bullish call on this stock at 60kobo with over 50% upside potential to 80-90kobo, and right now this stock has helped shareholders pocket more than 100% between January and August, the same period a lot of stocksare trading at a year and all time low.

Read here – This Stocks Is Among Bullish Leaders in the Insurance Sector

The stock is Law Union and Rock.

Why is the stock trending up?

The company reported a significant increase in operating profit to N181m in Q2, 2020 (from N43m in previous comparable period) which is like 320% growth while its profit after-tax expanded from N37m to N153m, representing 313% growth.

Continue reading “This Insurance Stock Has Doubled Since January, Should I Buy?”

Logistics companies are no doubt the .backbone of an economy, but stocks in this industry don’t always get the same attention as the banking stocks do, partly because of the monotonous nature of their business – accept parcels from customers or SMEs and send to recipients. With the unexpected disruption of supply chains and the way we buy and sell, this sector is a must-watch for smart investors looking for the next stocks to buy in Nigeria,

My Sure Pick – RedStar Stock – N3.63

Red Star Express Plc engages in the provision of courier services, mail management services, freight services, logistics, warehousing, and general haulage. It operates through the following segments: Courier, Freight, Logistics, and Support Services. The Courier segment involves in express delivery of documents and parcels. The Freight segment includes the clearing and forwarding of goods. The Logistics segment refers to warehousing and chain distribution services. The Support Services segment relates to mailroom management and other delivery services.

I had placed a call on Redstar plc sometimes ago on my Whatsapp group – Nigeria Stock Investors -when the stock was traded for N2.74. This has yielded a return of 32% when you check the market price as of this analysis.

Note: My Whatsapp group is open to premium subscribers only. Reach me on 08084219399.

Financials

In its recent financials, the company reported a 6% growth in turnover to N10.6b and lower operating expenses that helped boost its bottom line figure by 13.9% to N531m (up from N466m recorded in the previous year).

Continue reading “1 Sure Logistics Stock to Buy Before It Appreciates Again”

Let me say this before I share my current picks, I do not reveal all of my stock picks on this blog. It’s not that I am being evasive. The problem is that it’s not easy for me to post here every day as it’s time-consuming, so I’d rather share my latest stock picks on my Whatsapp group, And if you have been buying my stock picks lately, then congratulations!

I don’t pick stocks like a gambler but with a combination of fundamentals (which tells me what to buy), technical (which tells me when to buy) and sentiment (which tells me the stocks investors love), I have helped my subscribers improve their trade results significantly.

Here are some of the stock market picks I shared on my Whatsapp group:

These stocks have helped early buyers pocket an estimated 15-20%+ return via capital appreciation besides Skyavn went from N1.59 to N2.7, that’s 69% return in 2 weeks. Some other picks were MTN at N98, Ecobank at N4,8, Oando at 2.6, Jaiz bank, and so on.

If you want to join our Whatsapp group, kindly subscribe to my one one one coaching service where I will take you from scratch to becoming a good stock picker. Reach me via Whatsapp on 08084219399

Today, let’s look at two healthcare stocks that will enjoy more rapid capital appreciation in the coming weeks as they look oversold on the chart.

Glaxo Smithkline Consumer Plc

GSK has appreciated by 117% and 33.93% in the last 3 and 1 months respectively. This is not unconnected to the fact that healthcare is the hottest sector right now. With the Covid-19 pandemic shaping the way we live and the unavailability of a confirmed vaccine to fight the spread of the virus, we believe the sector will attract more grants and funds from the government.

Technically, the stock is oversold right now which calls for a gradual positioning ahead of a further share price appreciation which is driven by positive sentiments and improved financials.

In its recent financials, the company recorded a slight decline in revenue but profit after tax was largely supported by cost optimizations. EPS on a trailing twelve-month prints at 78k and if you adjust this by a 9% discount, you will arrive at a fair value of N8.6 which is 14.6% above the market price of N7.5.

May and Baker

Just like GSK, May and Baker stock is worth watching right now. I believe that the same sectoral policies that are driving healthcare stocks rub on this stock. In the last 30days, the stock has appreciated by 25.51% as investors factor in improved financials.

While its recent results show a marginal fall in revenue from N8.5b to N8, a significant reduction in net finance cost helped boost its after-tax profit to N716m against N342m recorded in the preceding year. EPS also grew by 67% to 41k (from 24.75k in 2018).

Using a risk-adjusted discount of 9% on its recent EPS of 41k, the stock is fairly priced at N4.5 which represents 47% upside potential from its market price of N3.05.

Make sure you average down on any of these stocks to cut your entry price.

Disclaimer: Kindly do your due diligence. These are my personal opinion on the stocks to buy next week.

The global pandemic has affected a lot of businesses around the world with almost 20-30% expected to close shop if they don’t innovate or activate their business continuity plan. The global stock market isn’t spared either as investors dump their shares for safe-haven assets.

As more measures are been put in place to control the spread of the virus, it is normal for authorities to plan on the strategic re-opening of the economy. With a more relaxed lockdown expected in the coming weeks, I have picked tow penny stocks that will benefit from the resumption of social activities and events while the third, a banking stock with a unique business model is believed to reap from increased issuance of local fixed-income bonds.

In the last 30 days, these 3 stocks that have appreciated by 20%+ return on average, pulled back, and are already showing signs of recovering (supported by unusual volume) from their respective oversold region.

Watch this video to discover the stocks I am buying next week.

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