Bull Run Momentum: United Capital, Fidelity Bank & Others Lead This Week’s Strategic Stock Picks
Nigeria’s equities market continues to surge, posting its biggest weekly gain of the year with a 7% rise in the benchmark index last week. In less than two months, the market has already delivered a 25.3% year-to-date return, signaling renewed investor confidence and strong momentum.
Analysts attribute this rally to:
• Strong demand for industrial goods stocks
• Ongoing earnings releases
• Anticipated attractive dividend declarations
• Revised equity allocation limits for Pension Fund Administrators (PFAs) — expected to boost institutional participation
According to Meristem Securities, investor engagement is likely to remain high, especially in fundamentally strong stocks.
Disclaimer: This is not a buy, sell, or hold recommendation. Investors should consult their financial advisors before making decisions.
This Week’s Fundamentally Strong Stock Picks
These selections are based on sound financial metrics and technical indicators, aimed at helping investors take strategic positions rather than speculating randomly.
United Capital Plc
Why it made the list: Strong profitability and stable valuation metrics.
• Net Profit Ratio (NPR): 51.6% (very strong profitability)
• Price-to-Earnings (P/E): 11.8x (moderate valuation)
• Relative Strength Index (RSI): 40.6 (nearing oversold territory — potential rebound zone)
Interpretation: Solid earnings power with room for potential price appreciation.
Fidelity Bank Plc
Why it made the list: Attractive valuation and solid fundamentals.
• NPR: 19.1%
• P/E: 3.8x (significantly undervalued compared to many peers)
• RSI: 57.3 (neutral-to-bullish momentum)
Interpretation: Trades below intrinsic value with strong upside potential if sentiment remains positive.
Cornerstone Insurance Plc
Why it made the list: Consistent performance in the insurance sector.
• NPR: 14%
• P/E: 13.5x
• RSI: 49.7 (balanced momentum)
Interpretation: Stable fundamentals with room for gradual appreciation.
Africa Prudential Plc
Why it made the list: Strong profitability and low valuation.
• NPR: 36.5%
• P/E: 2.4x (very low valuation multiple)
• RSI: 52.5
Interpretation: Undervalued relative to earnings strength — attractive from a value perspective.
Unilever Nigeria Plc
Why it made the list: Strong brand fundamentals and earnings stability.
• NPR: 11%
• P/E: 16.8x
• RSI: 98.7 (extremely overbought)
Interpretation: Strong fundamentals but currently heavily overbought — short-term pullback risk possible.
Market Outlook
With:
• Earnings season still unfolding
• Dividend announcements on the way
• Increased institutional participation expected
The bullish momentum may persist — especially in fundamentally strong counters.
However, as always, discipline, timing, and risk management remain critical.
Nigeria’s equities market continues to surge, posting its biggest weekly gain of the year with a 7% rise in the benchmark index last week. In less than two months, the market has already delivered a 25.3% year-to-date return, signaling renewed investor confidence and strong momentum.
Analysts attribute this rally to:
• Strong demand for industrial goods stocks
• Ongoing earnings releases
• Anticipated attractive dividend declarations
• Revised equity allocation limits for Pension Fund Administrators (PFAs) — expected to boost institutional participation
According to Meristem Securities, investor engagement is likely to remain high, especially in fundamentally strong stocks.
Disclaimer: This is not a buy, sell, or hold recommendation. Investors should consult their financial advisors before making decisions.This Week’s Fundamentally Strong Stock Picks
These selections are based on sound financial metrics and technical indicators, aimed at helping investors take strategic positions rather than speculating randomly.
United Capital PlcWhy it made the list: Strong profitability and stable valuation metrics.
• Net Profit Ratio (NPR): 51.6% (very strong profitability)
• Price-to-Earnings (P/E): 11.8x (moderate valuation)
• Relative Strength Index (RSI): 40.6 (nearing oversold territory — potential rebound zone)
Interpretation: Solid earnings power with room for potential price appreciation.
Fidelity Bank PlcWhy it made the list: Attractive valuation and solid fundamentals.
• NPR: 19.1%
• P/E: 3.8x (significantly undervalued compared to many peers)
• RSI: 57.3 (neutral-to-bullish momentum)
Interpretation: Trades below intrinsic value with strong upside potential if sentiment remains positive.
Cornerstone Insurance PlcWhy it made the list: Consistent performance in the insurance sector.
• NPR: 14%
• P/E: 13.5x
• RSI: 49.7 (balanced momentum)
Interpretation: Stable fundamentals with room for gradual appreciation.
Africa Prudential PlcWhy it made the list: Strong profitability and low valuation.
• NPR: 36.5%
• P/E: 2.4x (very low valuation multiple)
• RSI: 52.5
Interpretation: Undervalued relative to earnings strength — attractive from a value perspective.
Unilever Nigeria PlcWhy it made the list: Strong brand fundamentals and earnings stability.
• NPR: 11%
• P/E: 16.8x
• RSI: 98.7 (extremely overbought)
Interpretation: Strong fundamentals but currently heavily overbought — short-term pullback risk possible.
Market Outlook
With:
• Earnings season still unfolding
• Dividend announcements on the way
• Increased institutional participation expected
The bullish momentum may persist — especially in fundamentally strong counters.
However, as always, discipline, timing, and risk management remain critical.