MTN Nigeria Jumps as Tariff Hike Boosts Investors Sentiments
MTN Nigeria Plc share price increased in the equities market as market priced in the latest tariff hike in the industry. On Friday, MTN Nigeria share price settled at N247.90, up by about 6.4% from N233 at the beginning of the week.
Investors’ appetite for the telecom stock increased following a 50% tariff hike granted by the industry’s regulator. Tariff hike will boost telecom operators’ earnings, but analysts said there are potential risks that volume growth will suffer amidst tight economic conditions in Nigeria.
MarketForces Africa recalled that stock market value of MTN Nigeria plunged significantly due to three consecutive quarterly negative earnings performance spooked by inflation, and naira devaluation.
The telecom stock became profit taking targets for sell side actors in the local bourse due to a bleak earnings outlook – with price falling to as low as N170. The company’s move to localized debts using tower contracts renegotiation that were initially priced in foreign currency boosted expectations.
MTN Nigeria’s earnings performance was eclipsed as serial records of foreign exchange losses dragged its profitability downward to the extent of losing its equity capital in the tight race. The telecommunications giant’s market value has just surpassed N5.2 trillion as a results of the latest rally in the local bourse.
The stock is still trading at a huge discount to its 52-week high. At its peak, MTN Nigeria was valued at N6.714 trillion in the local bourse, ranked as the most valuable listed entity on the NGX. #MTN Nigeria Jumps as Tariff Hike Boosts Investors Sentiments Oyo Signs Contract Agreement on 68km Rural Road Projects
