Posted by: kevyngbash

Kindly help me out here. I am eager to convert my 'spreadshet money' to cash and I want youto tell me exactly how I should do this.

I have a stock that has made 80% and another one that has made 50% since november that I bought them. When you talk of extracting your profit only, what do you mean?

My initial plan was to keep the stocks for long (say 1 year) but your short term method is so enticing that I have been fully drawn to it.

Can you explain how one can make the best out of this short term investment method?

@ Kevyngbash - Converting spreadsheet money into cash requires the services of a broker if you already don't have one. Then you can do either of the following: (a) liquidating your entire position in a stock once you have reached your desired exit point i.e. 10% (over and above the combination of your entry and exit commission charges), to anything you consider reasonable and achievable.

(b) taking profit: if you bought stock worth N100k including charges (10k units) and the stock appreciates by N5. N5 x 10k units = N50k profit. You will need to sell enough units to the tune of N50k plus charges. This is profit taking. If I'm wrong, I'm sure the gurus will correct me.

(c) Since the market fluctuates as previously explained, make the best of it using the profit taking method, and provided the stock remains solid fundamentally, you can increase your holdings when buy opportunities present itself. This way your percentage gains at the end of the year will have increased over average gains.

Quote from: aktopgun on Today at 07:22:26 PM

it has been so interesting reading the threads for the last 2-3 weeks, really eye opening and very scary!
i for one am really worried that the ethos behind beginning to invest in the first place is being played down and lost, to be replaced by discipleship, (bordering on sychophancy). I thought we were trying to bring heads together to teach each other how to fish. its alright if you ask questions because thats the only way u learn but some the questions are downright scary, like which stocks would you recommend for tomorrow, or next week or the next 4 weeks etc.
fellas, any investment takes time to develop and grow. for individual investors who have limited funds (i'm sure very few people on this thread are billionaires), the best approach is still to choose good companies to invest in. if u make an investment and then can't sleep at night becausse your broker couldnt sell on friday nko? Blood pressure tablets, here i come time be that o!!. How many of the new brothers and sisters on this forum have even learnt how exactly their brothers and sisters who have been investing for long in the NSE evaluate a stock?
to think that some fellas even get upset when people who have taken time to look at a stock and analyse it post their thoughts and for whatever reason, it doesn't pan out. thtas the imperfection of the market.

Lets get the foundation right first brothers and then the rest will follow.

A lot of fellas here have learnt including me and we're all still learning. many folks have joined with their great expertise and moved us all to a new level in many ways. but never exchange learning for spoon feeding, don't do it because its never worth it. it will end up being the case that "i've taught u everything u know but i've not taught u everything i know".

its hard and time consuming yes but its not impossible as this forum proves.

keep up the good work guys. hopefully i'l be back in full force in a few weeks but i always cherish your insights and ideas.

heads up pumping, easi, wanajo, windy, yodi, fof2,olulufemi,naijadr, temmie10 et al.

@ Aktopgun - Hope you are still enjoying fatherhood. It has its ups and downs (sleepless nights/disrupted sleep)

I'm quite inclined to agree with you, but only to a certain degree. There's much more to learn beyond ratios and "fundamentals", but who's willing to share their wealth of knowledge? Everyone shares ratios, but as I understand there much more to learn beyond this, especially in the NSE. How do you know a stock is overvalued in comparison with its peers? How do you know, without been told that there a certain times to buy and sell a stock (many thanks to FatherOf2 for sharing of Thursdays and Fridays, and many other who contribute selflessly)? How do you as a newbie or jjc know anything substantial about the board of any company, to know that the profit/turnover and success depends on this management team? Many things we all read about foreign markets is not exactly applicable to the NSE, but somewhat adaptable. Who is willing teach how to adapt? Many amongst us have software we have been using before now that TA (technical analysis) has become the in thing. Are you willing to share the name of such software (thanks to everyone that has helped make using excel a lot easier and to those that suggested the use of Aptistock and Metastock).

niceuzor:

nio68 - what do you mean by silent reader,plz i'm a little bit confuse here.

@ Niceuzor - Nio68 has been following the thread without actively participating or anyone being aware Nio68's existence.

@all

Metastock v10 can be downloaded via the link below

http://www.megaupload.com/?d=5SRTTRIV


WARNING!: The file contains trojan like Adarmax Keylogger, so please use with caution and scan your system with an updated antivirus/spyware removal tool

DISCLAIMER: The decision to install the software is entirely yours, please obtain a legal license if you find it useful.

Thats sounds scary, not sure if my anti-virus ll get rid of that, is there any other link for this download? Please share .thanks

@Windywendy
No No No.I wasn't suggesting you recommend your hunches at all! I said 'share'.More people can investigate and confirm true or false.For instance,someone on this thread whose sister works in Unity bank,unknowingly "confirmed" your hunch.

Nothing said to undermine the good job you gurus are doing on this thread.Keep it up!

Gudchoice - plz briefly a little about this thread, it's seem to be confusing!

nio68:

Thats sounds scary, not sure if my anti-virus ll get rid of that, is there any other link for this download? Please share .thanks

Either Windows Defender and Avast antivirus should do the trick and both are free.

@All, Read this.

Dangote Flour IPO oversubscribed by 520 per cent
By Emmanuel Onyeche

Published: Sunday, 6 Jan 2008

The Dangote Flour Initial Public Offer, which closed on October 8 last year, was oversubscribed by 520 per cent, the management of the bluechip firm has confirmed.

Consequently, investors whose request for shares in the company could not be totally accommodated would have the balance of their offer money returned with interest.

The Media Relations Manager of Dangote Group, Mr Joseph Okonmah, who disclosed this to Sunday Punch, said the rate at which the Group borrowed money from the banks as well as the final approval of the Securities And Exchange Commission would determine the interest to be paid on returned money.

”We are returning money with interest at a rate between five and seven per cent, and this depends on the rate we took money from the banks. Of course, all these things must get the approval of SEC,” he told our correspondent on Friday.

On the percentage of the excess funds from the oversubscription that the company is prepared to absorb as well as the pattern of allotment to successful subscribers, Okonmah said all that would also depend on the approval of SEC.

”We are not taking any position until SEC approves the allotment pattern, but I can assure all successful subscribers to the offer that Dangote will apply the principles of fairness and equity in all it does concerning the offer,” he said.

According to him, the company is expecting the approval of SEC next week, and it is thereafter that people will start receiving their allotment offers.

Between September 6 and October 8, Dangote flour, preparatory to its listing on the NSE, offered 1.2 billion shares to the public at N15 per share to raise N18.75bn.

In the offer prospectus, it was stated that 60 per cent of the offer would be preferentially allotted to identified investors.

This was reduced to 20 per cent by the company, which stated that investors demand had, within the first week of the offer, overwhelmed initial projections.

This increased the share on offer to the public to 1 billion ordinary shares out of the total share offering of 1.250bn, while the preferential allotment was reduced to 250 million

The company, which sought to raise N18.75bn may have, by the oversubscription, pooled about N116.25bn.

Due to regulatory requirements, it cannot absorb all the excess funds and may have to refund as much as N48.75bn if it absorbs 50 per cent of the excess funds.

A subsidiary of the Dangote Group, Dangote Sugar Refinery, had made history in 2006 as the only company to have paid interest on returned money following an oversubscription.

Then, it offered 3 billion ordinary shares of 50 kobo each at N18 per share in what was described as the largest Initial Public Offering in the history of Nigeria as it sought to raise N54bn.

It was oversubscribed by over 300 per cent and the company returned money to its subscribers at the rate of 10 per cent, an action that earned it commendation from the Nigerian Stock Exchange.

Besides the Dangotes, other companies that have returned money to subscribers as a result of Oversubscriptions, though with no interest attached, include May and Baker, in 2006, when it raised N1.5 billion by way of offer of subscription of 375 million ordinary shares of 50 kobo each at N4 per share.

A reoccurring decimal which worries investors in the Nigerian Capital market is the issue of oversubscriptions and the returning of unabsorbed excess funds.

Investors also worry about the delay in the release of share certificates by issuers, some of whom use them as a ploy to tie down people‘s money.

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PLS GUYS,When is d TS on fidelity bank be lifted.i will appreciate ur reply soon.

tHANKS

@Gudchoice

to reply ur post and answer ur "how to", and "how do we know", i have a question too, "how do the more experienced investors aka gurus know as well? do u know?
i think i have a rough idea of the answer to that question and it is that they learned, and learned and applied and learned some more.
Fellas have blessed us all with their knowledge on this thread but it didn't just fall on them as i'm sure u know.
The info and insights have as someone said earlier just made the learning curve of anyone interested in learning less steep but shouldn't take the place of individual learning.
As u must have read in my post i said the expertise being shared here has been excellent, selfless educative and quite supportive. Some of the questions u asked on ur post about stocks are learnable(if there's such a word). its the technical stuff of uploading, tech indexes, software manipulation tha have enriched the whole process as an add on and doesn't and shouldn't replace the study and learning.

here are some more important questions i think would further help the learning of the game for people who are still learning:

How do i evaluate a stock pls anyone?
ho do i read and understand a companies financial report to get the gist in my evaluation?
how do calculate p/e ratio, eps,cash flow per share, dividend yield,current ratio,rsi,macd etc
how do u know when a stock is under or overvalued?
how do i handle my relationship with broker X?
what types of brokers are there
what is all share index?
please explain bid, offer system anyone?

all of these questions have been asked and answered in the early and mid parts of this great thread for peple willing to learn and i'm sure its helped fellas not only learn but feel more confident in themselves to make their own investment decisions.
Many of us don't even know we have to have an investment plan preferably before we begin to invest and just go with the latest hot pick on the current page being discussed.
there is a wealth of knowledge already divulged and still waiting to be divulged on this thread but we won't get it if we don't ask for it by asking questions to enrich our arsenal(did i just add that useless team's name in my post)       (MAN. U 4 LIFE!!, CHAMPIONS BABY)

The learning continues. happy investing

@Gudchoice

please understand
i have asked people which stock they think i can invest in from time to time when i am unable to sit down and do some checking myself for any number of reasons. If they do oblige (and most times they do , cuz i ask nicely ) i then take the suggestion and find time to build the story around the stock before throwing my hard earned dosh at it, if i concur. there are too many companies on the NSE for anone to be an expert on them all but then thats why we have this thread and guys like wanajo, fof2,pumping,easi,yodi windy, etc

catch my drift

@all,
good morning house, where can I download NSE trade data for use in analysis?
Pls reply if you know. thanks

aktopgun:


there is a wealth of knowledge already divulged and still waiting to be divulged on this thread but we won't get it if we don't ask for it by asking questions to enrich our arsenal(did i just add that useless team's name in my post) (MAN. You 4 LIFE!!, CHAMPIONS BABY)

The learning continues. happy investing

I for fear as I see that name ke!!! I beg I owe Tobechukwu better autographed soccer boots from "Rooonaildo", MAN. YOU 4 EVER!!!

pumping777:

I deeply concur.

Like I said in a recent post, the strength of this thread is in being able to make what other folks bring here, together with what you bring and make it your own.

No system is foolproof and everything keeps evolving.

Gudchoice:

Posted by: kevyngbash

@ Aktopgun - Hope you are still enjoying fatherhood. It has its ups and downs (sleepless nights/disrupted sleep)

I'm quite inclined to agree with you, but only to a certain degree. There's much more to learn beyond ratios and "fundamentals", but who's willing to share their wealth of knowledge? Everyone shares ratios, but as I understand there much more to learn beyond this, especially in the NSE. How do you know a stock is overvalued in comparison with its peers? How do you know, without been told that there a certain times to buy and sell a stock (many thanks to FatherOf2 for sharing of Thursdays and Fridays, and many other who contribute selflessly)? How do you as a newbie or jjc know anything substantial about the board of any company, to know that the profit/turnover and success depends on this management team? Many things we all read about foreign markets is not exactly applicable to the NSE, but somewhat adaptable. Who is willing teach how to adapt? Many amongst us have software we have been using before now that TA (technical analysis) has become the in thing. Are you willing to share the name of such software (thanks to everyone that has helped make using excel a lot easier and to those that suggested the use of Aptistock and Metastock).

I have to disagree with you here. If you have really taken the discussions on this thread to heart and expanded your knowledge along these lines, I don't see a question above that you cannot answer yourself. At least you can form an opinion and exchange ideas further with folks on this forum and then take a final stand.

Everyone here was a newbie at some point and I don't think folks here went to university or college to go and learn stock trading. You can learn. Just believe in yourself.

Just browsing the thread to pick out names of stocks others have picked without doing any analysis yourself, is one sure way of learning absolutely nothing.

WARNING: THE MARKET WARNS THAT LEARNING THESE AND OTHERS LIKE THESE IS LIABLE TO MAKE YOU WEALTHY

Here is a small instalment of the "tutorial" i spoke of late last year for my fellow nairalanders. I'm only able to do this cuz i'm on call and it's not so busy being sunday plus of course wifey & my son arent here!! .

here goes nothing.

How to evaluate a stock:

Before we go into the ratios to observe, let me just first say a few words on growth and value investing. First lets be clear, they are not mutually exclusive and ideally should be combined in the individual investors portfolio.
Growth investing is when u buy a stock whose earnings are high and forecasted to get higher. As a result of the current high earnings and the markets expectations, the prices of growth stocks are likely to be high. allow me to use football as an example as i'm sure we have many premiership fans here. Growth investing is like buying the finished product like Chelsea football club did when abrahamovich went and bought players who are already stars (mercenaries). When u buy the ready made product u expect it to perform week in week out or in our case, fiscal year to fiscal year. these players are expensive but will probably deliver most times. the same way growth stocks are solid and experienced and will deliver 8 times out of 10. they may therefore be expensive.
Value investing is like what that yeye manager at Arsenal football club does by coming to Africa and other 3rd world countries to search for young, largely untested players who he hopes will go on to become world stars like the players in Man united . ASSENE (notice i intentionally spelt his first name wrong ) searches ivory coast, togo etc for players he hopes will develop to world beaters. The same way value investors search for companies that are really yet to attain their potential or are only in the very early stages of doing so. He uses the price/earnings ratio most for this search amongst other ratios. example. If i may be so bold, when easi or pumping say company X is expensive for example, they can only be talking in terms of the companies earnings and performance. The current price of Company X's share on the NSE divided by the earnings per share (will talk on EPS a little later) gives the P/E ratio, the king of ratios for value investors.

An individual investor in my humble but certain opinion would do well to combine both growth and value investing strategies in his portfolio, with value strategies carrying the largest chunk, probably in a 70:30 or 65:35 percentage.

Now to the ratios used in fundamental analysis of a stock

by the way, before i go on i would like to thank the wrters peter lynch, Jason kelly, warren buffet, benjamin graham et al for their great books on investing.

niceuzor:

Gudchoice - plz briefly a little about this thread, it's seem to be confusing!

Niceuzor - What about this thread do you find confusing? This thread is for people interested in stocks on the NSE (Nigerian Stock Exchange). If you are interested in stocks and need to know about it, this is the place to be. If you have no prior knowledge, you will need to start reading this thread from page 1, coupled with getting a basic understanding of stocks in general from www.investopedia.com or www.about.com (under the finance section).

Whilst going through the pages of this thread from the start, you will need to start taking notes of things you understand and those you don't. For the things you don't understand, many gurus are here giving selfless advice and sharing their wealth of knowledge.

I hope this helps somewhat.

Oh, just to say that growth investors search for their "players" using earnings, that is, raw earnings and EPS (earnings per share). A groeth company is said to have earnings momentum whaen it increases earnings yr on yr or quarter or quarter.

to the Ratios now:

1.Current ratio:
Calculated by dividing the current assets of a company by its current liabilities. the word "current" isnt used in its everyday parlance here. Current assets refer to the assets of a company that can be immediately converted to cash eg accounts receivable, inventories, raw cash itself of course, etc.
Current liabilities refer to a companies debts that are required to be paid usually within one year, eg accounts payable.
Current ratio measures a companies ability to keep short term commitments. U want the ratio of current assets:current liabilities to be anything from 0.5:1,1:1,2:1, etc, as long as the current assets are more than or equal to the current liabilities side (at least no less than 0.5 preferably)

2. Dividend yield:
a favorite for nigerians is dividends but more importantly, dividend yield is more helpful. It is calculated by dividing the annual dividend a company pays out to share holders by the price of the share. example company A. it pays its shareholders a total dividend (adding all the dividend they paid per quarter together) of N1 and its share price is N20. its dividend yield is 1/20=.05, .05*100=5%.
U will notice that there are only 2 parameters used in calculating dividend yield, dividend and share price. Annual dividend for most companies remains relatively stable with little variation yr to yr. the price of the share on the other hand, changes daily, so if for example the share price of company A goes up to N40, the dividend yield becomes 2.5%. this ratio is best used for large cap companies and can help u choose btw them

got to run for now, patients to see. will continue as time allows

A book worth owning is A neat little guide to stock market investing by Jason Kelly, it has a lot of the info u need really but i will continue to try to give my digested thoughts on what he and others have so beautifully written

seun,thanks for the revealing much about the NSE.i have some thousands of unit of share with nem Insurance plc.please when did you think is the best time to sell ?

aktopgun:

@Gudchoice

to reply your post and answer your "how to", and "how do we know", i have a question too, "how do the more experienced investors aka gurus know as well? do u know?
i think i have a rough idea of the answer to that question and it is that they learned, and learned and applied and learned some more.
Fellas have blessed us all with their knowledge on this thread but it didn't just fall on them as i'm sure u know.
The info and insights have as someone said earlier just made the learning curve of anyone interested in learning less steep but shouldn't take the place of individual learning.
As u must have read in my post i said the expertise being shared here has been excellent, selfless educative and quite supportive. Some of the questions u asked on your post about stocks are learnable(if there's such a word). its the technical stuff of uploading, tech indexes, software manipulation tha have enriched the whole process as an add on and doesn't and shouldn't replace the study and learning.

here are some more important questions i think would further help the learning of the game for people who are still learning:

How do i evaluate a stock please anyone?
ho do i read and understand a companies financial report to get the gist in my evaluation?
how do calculate p/e ratio, eps,cash flow per share, dividend yield,current ratio,rsi,macd etc
how do u know when a stock is under or overvalued?
how do i handle my relationship with broker X?
what types of brokers are there
what is all share index?
please explain bid, offer system anyone?

all of these questions have been asked and answered in the early and mid parts of this great thread for peple willing to learn and i'm sure its helped fellas not only learn but feel more confident in themselves to make their own investment decisions.
Many of us don't even know we have to have an investment plan preferably before we begin to invest and just go with the latest hot pick on the current page being discussed.
there is a wealth of knowledge already divulged and still waiting to be divulged on this thread but we won't get it if we don't ask for it by asking questions to enrich our arsenal(did i just add that useless team's name in my post) (MAN. You 4 LIFE!!, CHAMPIONS BABY)

The learning continues. happy investing

@ Aktopgun - I go report u o!!! How u get time to write like dis? U must be pulling extra shift or skiving, anyway you are excused (thanks for the tutorial)

I hear you loud and clear and realise that there's only so much a guru can do help someone who chooses not to help himself. Yes, many amongst us would rather be spoon fed, while others would rather learn how to feed themselves. However some amongst us do not catch up so quickly, these are the people I speak on their behalf.

They themselves are frustrated with the pace at which they learn and understand, so someone has to do this payless, but not thankless job.

I appreciate all the effort everyone puts into this forum. Its an exceptional thing to see us Nigerians being our brothers' keeper. Not only do you enrich yourselves but you enrich others.

As I write I realise something. Our individual circumstances contribute to how we best apply ourselves to opportunities surrounding us. If someone has an enormous and pressing financial burden, this might compel the person to seek stocks that "pay gold" immediately as opposed to learning the ropes. Hopefully such a person will change once their crisis is over or subsided.

My man Pumping777 - I hope my explanation above, explains my explanation to the explained

I dey your side kampe. No shaking. I be learner so quite willing to learn and burn the midnite oil.

@gudchoice

as i am writing this i just finished seeing a patient with a chest infection, sorted him out. it doesn't take that long really. i wrote the post u quoted before i left home this am and thanks to u and nairaland wifey dey vex for me now say i dey chat online when i suppose dey prepare for work. the price i pay i guess, will make it up to her when i get home.

as i said, its sunday and my in-patients have been sorted out so i am not skiving so to say .

Ur views and comments are and will always be appreciated man. Lets thank God our minds are intact and we can think to invest, u wouldn't believe what a blessing it is if u've seen what i've seen working as a psychiatrist my brother. The lord is to be praised o!!

A bwill continue ook worth owning is A neat little guide to stock market investing by Jason Kelly, it has a lot of the info u need really but i to try to give my digested thoughts on what he and others have so beautifully written[/color]


AKTOGUN

What is actual title of the book you quoted?

aktopgun:

You want the ratio of current assets:current liabilities to be anything from 0.5:1,1:1,2:1, etc, as long as the current assets are more than or equal to the current liabilities side (at least no less than 0.5 preferably)

Is a ratio of 0.5:1 (of current assets:current liabilities) really desirable?. This ratio suggests that for every asset there are 2 liabilities

aktopgun:

@gudchoice

as i am writing this i just finished seeing a patient with a chest infection, sorted him out. it doesn't take that long really. i wrote the post u quoted before i left home this am and thanks to u and nairaland wifey dey vex for me now say i dey chat online when i suppose dey prepare for work. the price i pay i guess, will make it up to her when i get home.

as i said, its sunday and my in-patients have been sorted out so i am not skiving so to say .

your views and comments are and will always be appreciated man. Lets thank God our minds are intact and we can think to invest, u wouldn't believe what a blessing it is if u've seen what i've seen working as a psychiatrist my brother. The lord is to be praised o!!

@ Aktopgun - A man with your sensibilities always knows how to make people happy and right wrongs, so I know you will appease wifey easily.

The things we come across in life are bound to make us appreciate God and what we have in our lives. I'm truly in awe of the great minds that exist on this forum. I'm glad I find myself in the midst of all of you. This makes me even more proud to be a Nigerian.

poke:



A bwill continue ook worth owning is A neat little guide to stock market investing by Jason Kelly, it has a lot of the info u need really but i to try to give my digested thoughts on what he and others have so beautifully written[/color]


AKTOGUN

What is actual title of the book you quoted?

@ Poke - the title: The Neatest Little Guide to Stock Market Investing 2008 Edition; http://www.jasonkelly.com/smi.html

@bigjay01

u are a fast learner bro. u are absolutely right. a ratio of 0.5:1 is the worst case scenario i would be comfortable with but different people have different risk appetites.

Next ratio

P.E ratio- the tell all for a value investor. Calculated by dividing the price of a stock by the earnings per share. the lower it is the better. reason being that it tells you how much u are paying for every naira of a companies earnings. It can be trailing PE where the eps for the last fiscal yr or quarter is calculated (ie past tense) or it can be forward PE calculated by dividing the share price by the projected eps. projections of earnings are done by companies and analysts and unless they are bigboylarry, can be wrong.
Another way of assessing PE ratio is to look at it as the time it would take u to recoop ur investment. so if company A has a PE ratio of 10, technically speaking, it would take u 10yrs to recoop ur investment. u see why the smaller the PE is the better?

companies with high PE and high share price- investors may be willing to pay for the future of a company with a high PE ratio if they feel it has potential. example, in the dot com era of the nyse, u had companies with no proven track record of earnings but who were thoughtto be the next big thing with the sky being their limit and investors threw cash at the stocks causing their share prices to rise but with the denominator ie eps being low, the PE ratios for these companies were astonomically high and as they were unable to live up to the earning expectations of the market u know the rest of the story.

so for pe ratio, the lower the better. buying companies with pe ratios that are high is riskier than buying companies with low pe ratios.
Always remember to compare only companies in the same sector when comparing and evaluating stocks.

A small note on dividend yield i ommitted in my earlier post is that if the dividend as i said remains relatively stable at for example N1 per share and the price increases, as i explained the dividend yield drops and that may help to identify stocks that are or becoming overvalued at that price

next ratio.

EPS: aka earnings per share. the "koko" for the growth investor. it is calculated as the name suggests, by dividing the latest quarter or yearly earnings (whichever is most current) by the number of outstanding shares of a company. example, if company A has 1000 outstanding shares and makes N10000 in profit for 2007, the eps is earnings/oustanding shares ie 10000/1000 ie 10.
for EPS the higher the better.

a word of caution on EPS is that it can be manipulated using the accounting laws which are flexible and open to individual interpretation by companies example Enron, need i say more? company A can report earnings on goods sold on credit when payment isnt made yet but is being expected. if for any reason there are defaults in the future, the reported earnings won't hold true.
some companies may have exceptional items and others may not, it goes on and on

having said all that, EPS is still a very useful and important ratio to use but its probably wiser to back it up with other ratios to get a more correct story on the stock. Remember too that it is the denominator we use when calculating PE ratio so we will always need it.

EPS too can be trailing and forward like PE ratio using previous and projected earnings to calculate respectively

i hope all this helps and that i havent swamped anyone. just trying to make a difference.

omo these oyinbo people no get mind o, small stress dem don kolo finish, haba. this call na wa, bleep has been quiet a bit today thank God.

feel free to ask anything not understood and query me o, as i no be fountain of knowledge, i am fallible too. i could have made some mistakes that i myself need clarification on

the remaining ratios and gist are on their way as tobechukwu and im mama allow!! . in the mean time i think we have enough to chew on.

Hello gurus,
The following stocks are siad to be good buys for this week. Can the gurus in the house come together to analyse the tenecity of the recommendation? Waiting for your contribution.

Company                Basis of Recommendation                                      Remark                                                      

1. Unitybnk                      Relatively stable price   Growth stock                Buy                                                      

                                        Price appreciation        

2.Lasaco                          3Q PAT grew by 496.14%

                                       Turnover in 3Q is 280.62%                                  Buy

                                       EPS is 0.63k                


3.UACN                        Improved 2Q PAT by 43.99%

                                   Expectation of Bonus                                            Buy

                                   

4.UBA                           Expectation of 1Q PBT to be N15b

                                   Relatively stable price                                           Buy
                                                           

5.Wapco                     2Q PAT growth is 12.5%

                                  Price appreciation                                                Buy                                                                  

                                   

6.Intercont                 2Q PAT growth is 72.65%

                                   Turnover grew by 82.61% in 2Q                         Buy

                                   Declaration of 35k interim dividend

7.Nem Insurance         Undervalued

                                   3Q PAT grew by 2292.03%                                Buy

                                    3QTurnover growth is 220.873%  

           

8.Access Bank Plc        1Q growth by 190.566% in PAT

                                  Turnover growth in 1Q is 102.180%                Buy

           
9.Linkassure                  Undervalued

                                   2Q Turnover grew by 137.95%                       Buy

                                   PAT growth in 2Q is 1017.39%



10.GTBank Plc              Improved 2Q by 54.78%

                                   Turnover growth                                         Buy



11.Cornerstone          Undervalued

                                 Improved 3Q PAT by 853.23% in PAT          Buy                              

                                Growth stock



12.FCMB Plc                 Improved 2Q PAT by 139.60%

                                  Turnover growth is 101.085%                               Buy

13.Guinea  Insurance   Undervalued

                                   2Q PAT growth is 120.664%                                Buy

                                   Growth stock              

THE END
I NEED AN OBJECTIVE OPINIONS CONECERNING THOSE AFOREMENTIONED STOCKS.

AkTopGun,

I dey gbadun your tutorial. Fire on!

aktopgun:

Next ratio

P.E ratio- the tell all for a value investor. Calculated by dividing the price of a stock by the earnings per share.  the lower it is the better. reason being that it tells you how much u are paying for every naira of a companies earnings. It can be trailing PE where the eps for the last fiscal yr or quarter is calculated (ie past tense) or it can be forward PE calculated by dividing the share price by the projected eps. projections of earnings are done by companies and analysts and unless they are bigboylarry, can be wrong.
Another way of assessing PE ratio is to look at it as the time it would take u to recoop your investment. so if company A has a PE ratio of 10, technically speaking, it would take u 10yrs to recoop your investment. u see why the smaller the PE is the better?

companies with high PE and high share price- investors may be willing to pay for the future of a company with a high PE ratio if they feel it has potential. example, in the dot com era of the nyse, u had companies with no proven track record of earnings but who were thoughtto be the next big thing with the sky being their limit and investors threw cash at the stocks causing their share prices to rise but with the denominator ie eps being low, the PE ratios for these companies were astonomically high and as they were unable to live up to the earning expectations of the market u know the rest of the story.

so for pe ratio, the lower the better. buying companies with pe ratios that are high is riskier than buying companies with low pe ratios.
Always remember to compare only companies in the same sector when comparing and evaluating stocks.

A small note on dividend yield i ommitted in my earlier post is that if the dividend as i said remains relatively stable at for example N1 per share and the price increases, as i explained the dividend yield drops and that may help to identify stocks that are or becoming overvalued at that price

Kudos for the tutorial. On PE ratios, may I kindly ask: Which is more prudent to use, the TRAILING PE or the PROJECTED PE? For a growth stock like C & I Leasing a friend is even ready to buy at N10- N12 today considering what he believes are the potentials of the company. And yet he is looking at a 24 month from now. Don't you think he will be proved right sometime soon? And also many I see are using 30 as standard PE for the insurance industry considering also the new WIND that is blowing within that sector. What is safe? Trailing PE or Projected PE?
Oya, we are listening. Thanks