05 March 2019 : The Nigerian bourse closed negative for the second consecutive week, with the NSE ASI Shedding 2.12% WoW to close at 31,827.24 points while market capitalization dipped by N256.67 billion. The broad market loss was driven by bearish sentiments in the Banking (-5.83%), Brewers (-0.18%), Personal care (-5.26%), Food (-3.49%) and Oil & Gas (-2.60%) indices which neutered gains in the Cement (+2.09%) and Insurance (+1.04%) indices.

All opinions and recommendations on below stocks are from analysts at ARM Securities limited. Easykobo does not endorse or oppose any recommendations expressed in this article.

Zenith Bank Plc ( ZENITHBANK) – STRONG BUY (FVE: N38.17): Analysts retain their STRONG BUY rating on Zenith with a revised FVE of N38.17/share. Over 2019, analysts forecast EPS of N6.57 which is 7% higher than 2018 (N6.16) mainly reflecting i) expansion in assets yield from increase in loan book which would more than outweigh funding cost to support moderate expansion in NIM ii) increase in NIR due to resilience in fee income and ii) improvement in asset quality with non-performing loan (NPL) ratio of 4.5% and slower expansion in cost of risk (CoR) to 1.0%.

Fidelity Bank Plc – ( FIDELITYBK ) BUY (FVE: N2.92): With their estimates suggesting a solid performance for 2018, analysts have rolled forward their model and maintain their TP on the stock. Beyond their modeled expansion in Net Interest Margin over 2019, analysts expect stronger support from NIR (+19% YoY) during the year which will be central to earnings over 2019. Their estimates put PBT at N30 billion (+16% YoY) with EPS printing at N0.95 (+17% YoY).

Lafarge Africa Plc – ( WAPCO ) SPECULATIVE BUY (FVE: N18.07): Analysts have lowered their FVE on Lafarge to N18.07 as analysts now expect a more significant dilution from the N89 billion Rights Issue and a downward revision to their 2019 volumes growth. Based on current price, their FVE translates to a BUY. However, analysts are highly cautious on Lafarge and thus rate the stock a SPECULATIVE BUY.

Unilever Plc – ( UNILEVER ) STRONG BUY (FVE: N49.19): Analysts have a STRONG BUY rating on UNILEVER with their FVE of N49.19 (+13.1% upside), supported by their expectation of strong growth from the food business over 2019, given its resilience over the last two years - having maintained a double-digit growth. In addition, given Unilever’s strong cash balance and their anticipation of slight uptick in yields, analysts expect the company to report a higher net finance income over the year .

Okomu Oil Palm Plc – ( OKOMUOIL ) STRONG BUY (FVE: N97.75): Over their forecast period, analysts anticipate volumes growth emanating from the harvest of fresh fruit bunches from its extension 2 plantation. Based on their expectation for volumes growth, accompanied by margin expansion, analysts raise their FVE to N97.75.

Corporate Benefit Tracker

Last week

Dangote Cement Plc released its FY 18 result with EPS expanding 91% YoY to N 22.91 . The company also declared a final dividend of N16.0. 

Chellarams Plc formally launched its new product- the Real Active Malted food drink – to satisfy the demand of its new customers. 

Following the application of the voluntary delisting of Newrest ASL Nigeria Plc , the Company’s shares was placed on full suspension, to comply with the post-approval requirements which will precede the final delisting of the company.

Reporting for EasyKobo on Tuesday , 05 March 2019 in Lagos, Nigeria

Source: ARM Securities Limited

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