Oando Jumps by 1,154% from 52-Week Low as Market Price in Acquisition
Oando Energy Plc maintained uptrend in the equities market as value hunters, alpha seekers continue to bet on the oil company’s future earnings streams. In 12 months, the stock has gained 1,154% from 52-week low of N7.1 to N89.05 in the equities market on Friday.
For the company, many earnings drivers have changed positive and the market expects its strategic moves to impact future earnings positively.
The indigenous energy company has seen strong market rerating following improved business fundamentals and a move to acquire Nigerian Agip Oil Company, a move that analysts called beautiful acquisition taste.
Due to improved investors’ sentiment, the oil stock has surged by 1,154% above its 52-week low. According to data from the Nigeria Exchange, Oando share price increased by more than 20% over the last seven trading session in the equities market.
Its share price rose by 20.33%, up from N74 per to N89.05 on Friday. The market now value the company’s 12.431 billion shares outstanding at N1.107 trillion, details from Nigerian Exchange showed.
At the current market price, the energy company’s market price is trading at about 10% below its 52-week high, suggesting low negative volatility linked to sustained rally.
The stock is trading far ahead of its 52-week low of N7.10.
In August, Oando Plc successfully finalized its USD783 million acquisition of Nigerian Agip Oil Company (NAOC), a subsidiary of Eni, after receiving the necessary approval from the Nigerian Upstream Petroleum Regulatory Commission (NUPRC).
This acquisition marks a significant milestone for Oando, coming after a thorough nine-month regulatory review, Meristem Securities limited said in an update.
Analysts said by acquiring NAOC, Oando has doubled its stake in Oil Mining Leases (OMLs) 60, 61, 62, and 63, increasing its ownership from 20% to 40%.
This expanded stake is expected to enhance Oando’s production capacity and strengthen its position within Nigeria’s oil and gas sector, setting the stage for potential growth and increased market influence.
“We expect this expanded stake to significantly enhance Oando’s production capacity. By revitalizing these previously underutilized assets, Oando is poised to boost its total reserves, strengthen investor confidence in Nigeria’s oil and gas sector, and contribute to an increase in the country’s oil output as these operations ramp up”, Meristem said. #Oando Jumps by 1,154% from 52-Week Low as Market Price in Acquisition
