CardinalStone Upgrades Unilever Nigeria Target Price to N146.08
Equities investment analysts at CardinalStone Securities Limited, one of the top brokers with the highest transaction record in the Nigerian Exchange, have raised Unilever Nigeria’s 12-month target price to a hold recommendation.
The investment firm raised Unilever Nigeria’s 12-month target price to N146.08, 67% up from N87.58 previously, to reflect a lower equity risk premium of 12.6% from 13.8% and a higher terminal growth rate, given better macroeconomic conditions and the country’s outlook.
“Relative to our reference price, our 12-month TP implies a 4.3% upside and a HOLD recommendation”, the firm said in its equity report released.
CardinalStone said that Unilever Nigeria Plc has cemented its standing as one of the most resilient and top-performing companies within Nigeria’s consumer goods industry, as evidenced by its consistent upward earnings trajectory and relative consistency in delivering income to shareholders.
Equities analysts noted that in Q1’26, the company delivered better margins and modest improvements in return on average asset (ROA) and return on equity (ROE).
CardinalStone Securities projected 29.8% year-on-year earnings per share growth to N7.27 in the financial year 2026, an upgrade from N5.60 in 2025.
“Our earnings expectation is supported by topline momentum, given the company’s strong market share, continued spontaneous financing through effective working capital management, and significantly low leverage”, the firm said.
Analysts said Unilever Nigeria’s margins may be slightly lower, reflecting the negative pass-through from the US/Israel-Iran war.
“Our updated earnings projections led to an upward review in our 12-month Target Price to N146.08 versus N87.58, previously, representing a 4.3% upside and a HOLD recommendation.
“Ongoing geopolitical tension likely to trigger price increases. Unilever Global recently signalled its intention to begin raising prices in response to mounting cost pressures stemming from the Middle-East war”.
The sharpest price increases will occur in Asia, Africa, and Latin America — regions expected to record the highest inflation — with implementation commencing in the second half of the year, CardinalStone said, citing Unilever management.
In line with its parent’s disposition, analysts said they expect UNILEVER to also raise prices, given that energy costs have risen by over 30.0% since the conflict began in February, contributing to the historic 6.6% MoM surge in energy inflation recorded in March 2026.
“We expect the knock-on effect of the Middle-East conflict on UNILVER to be less pronounced compared to some select peers, supported by the company’s cost optimisation strategies that include the frontloading of inventories and spontaneous financing”.
The report noted that about.60.0% of raw materials and packaging inputs are locally sourced, which supports cost control and supply stability. For logistics, the company has begun to use CNG trucks in certain locations, which further reduces costs, as CNG trades at a discount to other energy options.
“The anticipated price increases have prompted us to slightly taper our volume growth assumptions, resulting in a forecasted revenue growth of 38.3% for FY’26, which is below the historical 3-year average of 46.2%”.
UNILEVER closed Q1’26 with a cash position of N114.5 billion, up by +43.5% year on year, driven by improved profitability, strong operating cash flow retention, and higher finance income.
For the rest of 2026, analysts expect UNILEVER’s cash to remain robust, driven by improved earnings from volume growth across product categories, sustained working capital management, and investments in short-term instruments to improve finance income.
The investment anticipates a dividend payout ratio of about 66.9% in FY’26, implying a dividend of N4.86/share from N3.75/share in FY’25. Equities Investors Lose N1.92trn in Nigerian Market
