Aradel, NEM, FCMB Group top stock pick this week

Nigerian stocks added 0.9 per cent last week, recovering from the depreciation it recorded penultimate week, supported by increased investors’ interest in bank and oil & gas stocks. That took the year-to-date yield of the market to 57.3 per cent.

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“Following the strong rally witnessed in recent months, investors may continue to capitalise on elevated prices to lock in gains, particularly in stocks that have recorded substantial year-to-date appreciation,” said analysts at Meristem Securities in their outlook for the week.

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.

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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.

Aradel Holdings

Aradel Holdings tops this week’s pick on the basis of its strong fundamentals. The energy company’s net profit ratio (NPR) is 57.5 per cent, while the price-to-earnings (PE) ratio is 19.7x. Its 14-day relative strength index (RSI) is 48.8.

NEM Insurance

NEM Insurance makes the selection for its strong fundamentals and for trading below its intrinsic value. The NPR of the insurer is 9.6 per cent, while the PE ratio is 11.3x. Its 14-day RSI is 62.4.

FCMB Group

FCMB Group appears on the pick on the basis of its robust fundamentals and for trading below its intrinsic value. The NPR of the banking group is 11.1 per cent, while the PE ratio is 1.5x. The 14-day RSI is 49.4.

ALSO READ: Sterling Bank, Coronation Insurance, Nascon top stock pick this week

Transcorp

Transcorp makes the selection on the basis of its strong fundamentals. The NPR of the conglomerate is 25 per cent, while the PE ratio is 5.2x. Its 14-day RSI is 44.6.

Coronation Insurance

Coronation Insurance makes the cut by virtue of its strong fundamentals. The NPR of the insurer is 9.2x, while the PE ratio is 8.7x. Its 14-day RSI is 48.7.