Top Stocks that Make Investment Sense in Bullish Market
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Top Stocks that Make Investment Sense in Bullish Market

Investment bankers have started showing preference for stocks with stronger than peers yields, a number of equities reports indicated that large cap stocks are mostly on top of the list.

It is the time of the year that equities returns record shows an uptrend as the equities segment of the Nigerian Stock Exchange turned the corner recently.

Thanks to latest policy rate cut by the Monetary Policy Committee of the Central Bank of Nigeria.

As inflation continues maintaining upward trajectory, yields in the fixed income market have plunged to near time low.

This has widened negative return which is the current characteristic of government securities, largely supported by low interest rate environment.Top Stocks that Make Investment Sense in Bullish Market

With third quarter earnings season lurking around, more stocks price would go vertical and it won’t have anything to with fundamentals.

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This dovish stance would pull money away from the stock market, and guess where investors would channel the fund: stock market.

It is happening already as in long term market capitalisation kissed N14 trillion market as the All Share Index traveling to 30,000 points.

It will happen so soon, and like me, you would have wished you make some investment no matter how small.

The market has moved away from loss zone, year to date return is now positive, thanks to movement in some high market capitalisation stocks.

Here is what equity research analysts are saying about some stocks that will further go vertical in this month and perhaps down the year.

First, top picks include banking stocks except that few investment bankers seems to be a little bit bearish on FirstBank Plc.

But, after lender’s balance sheet repairs, the financial position and profitability of the group has increased.

Going forward, some equity analysts say FBNH estimate would be upgraded.

Other lender’s in the Tier-I capital category are actually money spinning for investment purpose, their year to date losses have been moderated.

Zenith, UBA, GTBank and Access Bank are in the money and most of equity research analysts advised investors to buy them for estimated upside potential.

Their price targets upgrade raised possibility of earnings more from banking stocks in the fourth quarter as sentiments improve in the market.

Chapel Hill Denham is perhaps looking for possible re-rating of these stocks, while Cardinalstone also maintained similar point.

For now, despite the bullish trend, Nigeria’s banking sector, FMCG and other segment seems to be undervalued, according to various equity research report.

Lafarge WAPCO stock is pitched higher compare with BUA Cement, but Dangote Cement remains the dividend-king in the category.

In beverages segment, investors are showing preference for Nigerian Breweries stocks, this was supported by Heineken B.V presence in the market recently.

It would be recalled that Heineken acquired more than 11,000,000 shares in the open market from shareholders worth some N432 billion according MarketForces Research.

This move boosted sentiment and stock price move up strongly, though NB Plc earnings performance was largely disappointing.

Also, pricey Nestlé Nigeria is expected to pick up.

But not so much is expected from other consumers’ goods like Cadbury Plc, Unilever and PZ Cussons majorly for their lacklustre earnings performance.

Dangote Sugar has been picked as one of the stocks to watch. The stock was recommended by equity research analysts at Chapel Hill Denham.

The fact is, this is the time to make money trading shares following the uptrend in the market. It is more likely to see prices rising, perhaps down the year.

Some stocks would automatically enjoy re-rating, and finding an entry points would make significant impacts on investors’ portfolio returns.

Perhaps, it is time for you to get on-board.

You might be considering where to invest ₦10,000 or ₦10 million, we have your back. Just send email to [email protected]

Read Also: Bullish Party Over as Stock Market Drops Further

Top Stocks that Make Investment Sense in Bullish Market