Ecobank, Access Holdings Top Stocks Pick this Week

Nigerian stocks appreciated 3.8 per cent last week, bringing their yield so far this year to about 42 per cent.

Against analysts’ expectation that a hawkish stance at the next monetary policy committee meeting would cause interest to shift from equities to fixed-income securities, demand for stocks increased, helping to wipe out the loss reported for the penultimate week.

The earnings reports of big names including Dangote Cement, MTN Nigeria, Seplat, the big 5 banks (excluding FBN Holdings) and Nestle are being awaited, and they could shape the fate of the market in the weeks ahead.

“We are expecting a lot of value coming from that space (tier 1 banks) and we know that when those results start coming in, it will give investors a lot of value,” Muktar Mohammed, analyst at Assar Investments, said in an interview with CNBC Africa on Friday.

Lagosbusinessnews assembled a number of stocks with fundamentals and other potential, adopting key analytical approaches to save you the hassle of randomly picking equities for investment.

The selection, a product of analytical market watch, offers a guide to entering the market and taking strategic positions in hopes that equities will gain value with the passage of time, particularly in the short term.

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.

EcoBank Transnational Incorporated (ETI)

ETI tops this week’s pick for currently trading significantly below its intrinsic value. The lender’s price-to-earnings (PE) ratio is 1.3x, while its price-to-book ratio (PB) is 0.4x.

Access Holdings

Access Holdings makes this week’s pick for trading significantly below its intrinsic value.
The PE ratio of the financial services group is presently 3.1x, while its PB ratio is 0.5x.

C&I Leasing

C&I Leasing appears on the list for currently trading below its intrinsic value. The company’s PE ratio is 7.4x, while its PB ratio is 0.4x.

Custodian Investment

Custodian Investment makes the list for trading well below its real value, brightening its chances of significant price appreciation in future. The PE ratio of the company is 3.6x, while its PB ratio is 0.8x.

Flour Mills of Nigeria

Flour Mills makes the cut for currently trading below its real value. The company’s PE ratio is 8.5x, while the PB ratio is 0.7x.

Linkage Assurance

Linkage Assurance makes this week’s pick for currently trading significantly below its real value. The PE ratio of the financial services group is presently 3.8x, while its PB ratio is 0.5x.