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UBA, Bank PHB quarterly results as sign posts to investors
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Francis Atuche, MD, BankPHB
Equity investors have placed the quarterly results from United Bank of Africa plc (UBA) and Bank PHB plc under scrutiny even as institutional investors see the development as a sign post to their investment strategy in the first quarter of the New Year.
As analysts at Investors Daily Edge (IDE), are wont to say, the stocks may be heavily traded because the earnings have shown that the two institutions have consolidated previous performance.
UBA’s first quarter result to December 31, 2007 showed a significant an increase of 104.4 percent or N4.7 billion in profit from N4.5 billion in 2006 to N9.2 billion.
Gross earnings equally grew by N16.88 billion to N39 billion from a corresponding N22.12 billion recorded in 2006. This represents an increase of 76.31 per cent.
Similarly, Bank PHB recorded N6.42 billion rise in profit according to its results for half year to December 31, 2007. The Bank’s results released to the operators and investing public showed that profit grew from N2.03 billion to N8.45 billion, representing 316.3 per cent increase.
Its gross earnings in the period jumped by a significant N22.19 billion to N33.54 billion, as against N11.35 billion in corresponding period of 2006, representing 195.5 per cent increase.
It is expected that the two stocks would be widely watched this quarter especially by those who have found that earnings present one of the more target-rich environments for investors to get clear signals of where stocks are headed.
According to IDE, “All you have to do is look at the calendar to know when each company reports. In fact, the average daily volume for the more widely watched stocks typically rises around earnings season. So outside of identifying that there are trading opportunities in the mix during earnings season, you must be asking yourself “what’s in it for me?
It would be recalled that UBA recorded a resounding an industry profit record of N21 billion in its immediate last operational period.
On its part, Bank PHB has just concluded its hybrid offer of N100 billion which was seen as a good buy owing to investors’ attraction to it.
Meanwhile, the week’s equity trading on the NSE ended on mixed note with the market capitalisation rising to N10.6 trillion while the all-share index closed at 59,257.16, a decrease of 1.22 percent from the previous week’s level.
The banking sub-sector emerged the most attractive sector to investors, accounting for 1.84 billion shares worth N49.9 billion exchange by investors in 33,906 deals out of 4.22 billion shares worth N70.8 billion exchanged within the week in 77,374 deals. Volume in the sub-sector was largely driven by activity in the shares of Intercontinental bank Plc, Oceanic Bank an, Unity bank Plc and Afribank Nigeria Plc.
The Insurance sub-sector boosted by activity in the shares of Equity Assurance Plc and NEM Insurance Plc, followed on the week’s activity chart with a turnover of 1.8 billion shares valued at N6.63 billion in 19,016 deals.
The price movement analysis showed that Six-Four stocks appreciated in price led by Nigeria Energy Sector Fund with a gain of N76.00 to close at N741.23 per share while African Petroleum Plc followed with N51.10 to close at N270.11 per share. Chevron Oil Nig Plc, Nestle Nig. Plc and Total Nig. Plc followed the top five gainers table, appreciating N22.70, N13.00 and N9.55 respectively.
Conversely, 68 stocks depreciated in price led by West Portland Cement Co. Plc (WAPCO) which dropped N10.31 to close at N72.20 per share while Oceanic Bank International Plc followed with a loss of N7.51 to close at N28.62 per share. Chemical & Allied Products Plc (CAP), Nigerian Aviation Handling co. (NAHCo) and Beta Glass Co. Plc closed the list of top five losers dropping N7.39, N4.31 and N3.94 in that order.
UBA’s first quarter result to December 31, 2007 showed a significant an increase of 104.4 percent or N4.7 billion in profit from N4.5 billion in 2006 to N9.2 billion.
Gross earnings equally grew by N16.88 billion to N39 billion from a corresponding N22.12 billion recorded in 2006. This represents an increase of 76.31 per cent.
Similarly, Bank PHB recorded N6.42 billion rise in profit according to its results for half year to December 31, 2007. The Bank’s results released to the operators and investing public showed that profit grew from N2.03 billion to N8.45 billion, representing 316.3 per cent increase.
Its gross earnings in the period jumped by a significant N22.19 billion to N33.54 billion, as against N11.35 billion in corresponding period of 2006, representing 195.5 per cent increase.
It is expected that the two stocks would be widely watched this quarter especially by those who have found that earnings present one of the more target-rich environments for investors to get clear signals of where stocks are headed.
According to IDE, “All you have to do is look at the calendar to know when each company reports. In fact, the average daily volume for the more widely watched stocks typically rises around earnings season. So outside of identifying that there are trading opportunities in the mix during earnings season, you must be asking yourself “what’s in it for me?
It would be recalled that UBA recorded a resounding an industry profit record of N21 billion in its immediate last operational period.
On its part, Bank PHB has just concluded its hybrid offer of N100 billion which was seen as a good buy owing to investors’ attraction to it.
Meanwhile, the week’s equity trading on the NSE ended on mixed note with the market capitalisation rising to N10.6 trillion while the all-share index closed at 59,257.16, a decrease of 1.22 percent from the previous week’s level.
The banking sub-sector emerged the most attractive sector to investors, accounting for 1.84 billion shares worth N49.9 billion exchange by investors in 33,906 deals out of 4.22 billion shares worth N70.8 billion exchanged within the week in 77,374 deals. Volume in the sub-sector was largely driven by activity in the shares of Intercontinental bank Plc, Oceanic Bank an, Unity bank Plc and Afribank Nigeria Plc.
The Insurance sub-sector boosted by activity in the shares of Equity Assurance Plc and NEM Insurance Plc, followed on the week’s activity chart with a turnover of 1.8 billion shares valued at N6.63 billion in 19,016 deals.
The price movement analysis showed that Six-Four stocks appreciated in price led by Nigeria Energy Sector Fund with a gain of N76.00 to close at N741.23 per share while African Petroleum Plc followed with N51.10 to close at N270.11 per share. Chevron Oil Nig Plc, Nestle Nig. Plc and Total Nig. Plc followed the top five gainers table, appreciating N22.70, N13.00 and N9.55 respectively.
Conversely, 68 stocks depreciated in price led by West Portland Cement Co. Plc (WAPCO) which dropped N10.31 to close at N72.20 per share while Oceanic Bank International Plc followed with a loss of N7.51 to close at N28.62 per share. Chemical & Allied Products Plc (CAP), Nigerian Aviation Handling co. (NAHCo) and Beta Glass Co. Plc closed the list of top five losers dropping N7.39, N4.31 and N3.94 in that order.
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