Futureview Guides Sell Rating on Dangote Cement
Dangote Cement Plc has more than 20% downside potential, according to Futureview Financial Services Limited stock recommendation for the week.
The investment company sets its target price for the cement company at N520, which is 20.82% lower than the N656.70 market price on the Nigerian Exchange.
To Futureview, this suggests that Dangote Cement Plc has been overpriced in the stock market, then analysts downgraded the stock to sell to eliminate the potential downside.
Some analysts have expressed similar opinion on the cement company’s stocks. Dangote Cement Plc has become closely held after the company bought back its own shares to stem volatility.
The fact that its majority shareholdings are under the control of Dangote Industries Limited suggest low external influence could force the price adjustment negatively.
Dangote Cement Plc remains the industry leaders among the cement oligarchy with more than 60% market share. It also has highest industry margin, which derives from its economic of scale and efficient cost control.
Futureview analysts lower Dangote Cement Plc to sell rating as the investment company expects a mixed performance in the equities market, driven by subdued investor sentiment.
This is an emphatic negative comment on the cement stock’s prospects. The stock price has been flat at this level like forever, according to trading data from the Nigerian Exchange. Investors in Bond Market Reacts as Inflation Runs Hot
