Banks with Negative Year to Date Returns, Upside Potentials
Most of Nigerian banks have negative year to date return, according to data from their separate financial statements.
Despite heavy profit, most banks have not boost their shareholders wealth enough, especially, retail investors that seek both capital appreciation and dividend payments.
Tier-1 banks, and some Tier-2 lenders distribute their profits to shareholders two times in a year – at best. But in term of capital appreciation, the sell side activities often tame positive price movements.
Stanbic IBTC Plc has highest loss of value from the beginning of the year to date. It has loss 23.33% of market price at the beginning of the year.
In a stock recommendation list, Apel Assets Limited estimated showed the tier-2 lender has 19.79% upside potential at N63.97 fair value estimate.
Afrinvest limited asked investor to accumulate Stanbic IBTC as its estimated 23.2% upside potential which the firm said is above industry average.
The bank reported 27.74% return on equity – Higher than FBN Holdings (18.23%), a tier-1 financial services group.
ACCESS Holdings Plc: has also broken its investors’ value, losing more than 17% from the beginning of the year to date. The Nigerian largest lender has one of the highest upside potential in the banking sector, according to a view expressed by Apel Asset Limited in its estimate.
The financial services group ranked well in terms of return on equity which reached 28.34% in the first quarter of the year – versus GTCO (36.53%), FBNH (18.23%), UBA (29.93%) and Zenith (29.13%).
FBNH Holdings Plc: After spiraling downward, FBNH has lost 11.04% of its market value from the beginning of the year to date.
Trading at more than 50% discount to its peak price in the year, Apex Asset Limited now estimated that the financial services group has more than 109% upside potential at fair value of N43.85 per share.
Equities analysts recommend that investors should buy the stock due to huge potential upside at reference price of N20.95.
In its recommendation note, Afrinvest Limited increased FBNH target price to N29.67 per share from N28.70 previously set. The investment firm expects 42.3% upside in FBNH after one of the worst dividend yield of 1.92% in the banking sector.
Top banks with better dividend yield include UBA (12.39%) ACCESS (10.94%), Zenith (10.65%), GTCO (6.99%), details from Apel Asset Limited showed.
United Bank for Africa: UBA Plc has lost 12.48% of its market price from the beginning of the year to date. Analysts see 55.71% upside potential in the Pan African financial services group.
Equities analyst at Apel Asset Limited estimated UBA fair value at N34.96 per share at reference market price of N22.45 on Friday. According to analysts estimate, UBA has second largest return on equity in the banking sector of 29.93%.
Afrinvest Limited forecasted 36% upside potential for the financial services group having raised the bank’s12 months target price to N30.61 per share from N20.75.
Zenith Bank Plc: Zenith Bank Plc has 34.65% upside potential, according to Apel Asset Limited estimates. The bank has lost 1.68% of its market value from the beginning of the year to date, based on its stock market performance data.
Details showed that Zenith Bank achieved 29.13% return on equities with a fair value of N51.17. Zenith bank target price was raised to N42.90 per share by analysts at Afrinvest Limited from N41.70 with expected return on 14.14%. #Banks with Negative Year to Date Returns, Upside Potentials
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