Jaiz Bank, FCMB Group, Julius Berger top stock pick this week

Nigerian stocks have now returned nearly 40 per cent this year after yielding 1 per cent last week, when oil & gas stocks were the toast of investors.

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Equities have been short of big drivers in recent weeks. With the release of third-quarter corporate results set to start later this month, however, the market may be in for increased trading activities.

“Our expectation of stronger deal flow into the local bourse and selective rotation into interest rate sensitive stocks is poised to bolster market activity, as investors digest recently released macroeconomic data,” analysts at Meristem Securities had predicted, going into the week.

“In the same vein, increased liquidity conditions may prompt higher repricing across strong-performing tickers,” they added.

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 in hopes that selected stocks will record reasonable price appreciation with the passage of time.

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.

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Jaiz Bank

Jaiz Bank tops this week’s list for trading well below its intrinsic value. The net profit ratio (NPR) of the bank is 29 per cent, while the price-to-earnings (PE) ratio is 6.5x. Its relative strength index (RSI) is 42.6.

FCMB Group

FCMB Group makes the cut for trading below its intrinsic value. The financial services group’s NPR is 8.1 per cent, while the PE ratio is 4.6x. Its RSI is 48.8.

Julius Berger

Julius Berger makes the selection for trading close to its lowest price in 52 weeks, giving an attractive entry point to potential investors. Its NPR is 2.1 per cent, while its PE ratio is 18.4x. The RSI is 17.7.

NEM Insurance

NEM Insurance appears on the pick for its fairly strong fundamentals. The NPR of the underwriter is 25.9 per cent, while the PE ratio is 4.1x. Its RSI is 39.4.

Africa Prudential

Africa Prudential makes the cut for its currently sound fundamentals. The company’s NPR is 36.6 per cent, while the PE ratio is 20.8x. Its RSI is 46.2.