UACN – Equity Analysts Upgrade Target Price, Set 39 Upside
Equities analysts at CardinalStone Securities Limited have raised UAC of Nigeria Plc’s target price to N246.65, translating to about 39% upside potential.
Equity analysts at CardinalStone Securities said the revised target price reflects the firm’s updated earnings expectations, ongoing deleveraging and improved working capital efficiency.
“It also incorporates a downward revision to our equity risk premium to 12.2% from 12.6% previously and risk-free rate to 17.0% from 16.4%, alongside the adoption of forward MEA peer median multiples”.
With N540 billion in market capitalisation, UACN maintains a strong position in the fast-moving consumer goods sector against rivals. The consumer goods company delivered an impressive earnings performance in the first half of 2026.
Revenue grew 3.3x to ₦365 billion while Profit Before Tax grew 3.1x to ₦34 billion in the first half of the year. The group grew net income by 172% year on year to N20.026 billion, supported by significant topline performance.
This translated to 177% year-on-year earnings per share (EPS) growth to 658 kobo, according to half-year results reported by MarketForces Africa.
In its first six months of earnings consolidation with the newly acquired C.H.I Limited, UACN has demonstrated stronger cash conversion, CardinalStone said,
The company’s H1’26 free cash flow rose to about N70.9 billion from N8.8 billion in H1’25, supported by stronger operating performance and an inventory reduction.
Analysts said this enabled UACN to reduce debt to N307.0 billion in H1’26 from N344.8 billion in FY’25, strengthening our conviction in the group’s deleveraging trajectory.
CardinalStone said that while higher energy costs pose downside risk, management saw declines in raw material costs, and analysts kept the EBIT margin forecast steady at 13.3%.
Due to the expectation of a higher effective tax rate under the new regime, analysts at CardinalStone Securities cut the profit after tax margin estimate from 5.9% to 5.5%.
“… we have marginally raised our target price to N246.65 from N241.18 previously as lower debt forecasts outweigh the impact of our lower net profit margin.
“We have also factored in a higher risk-free rate of 17.0% versus 16.4% earlier in our revised valuation to reflect prevailing macroeconomic conditions”. #UACN – Equity Analysts Upgrade Target Price, Set 39 Upside# UACN: Good Addition for Value Investors with 3-Year Outlook – WSTC
