₦airaland Forum

So Presco share price is closing in on that of Okomu. Same with market capitalization. I guess one becomes more attractive from the point of view of total annual dividends if all things remain the same as or similar to history.

I had mapped up a plan to continue buying Presco till a target accumulated total is reached, but the current bull took everything to a whole new level.

yok:
I will only comment on the long term prospect. AI have just started, equipment makers are the current beneficiaries and the long term belongs to AI software makers (for best AI software stocks our private group member will be given specific names).

Just think of AI as the development of social media, see now social media has now become: medium of obtaining justice (Mohbad case). a very useful tool on recovering debt from reactant debtors especially if it is a company (if ant company is owing you and they have a web presence, just joking the it group and post their, I am sure they will beg you that they will pay, I have experienced this), AI can replace some professions and render some professions useless (who will need Customer service staff ater AI is fully developed, few, Customer service staff have to become real marketers or upgrade to become AI operators themselves) etc.

So conclusion. Investment in AI is not likely to go wrong, as long as you buy strong companies.

Thank you boss for the detailed response and advice.
I agree with you 100%. The major hurdle when keeping stocks like these long term is that they make many circles (AMD $90-$120, GOOGL $115-135) before a general bull (market derepression to all-time high stock prices) happens. For long termers, it feels like a strategy that gets one shortchanged especially when you consider the fact that such companies have sacrificed investors' cash flow (through dividends, bonuses, etc.) for growth. Traders on the other hand are making money by buying and selling at appropriate junctions in the cycle. When the craze about AI starts reflecting in stock prices, cash flow will still be zero, and the only way to make money will be to sell, or one would again lose the paper gains. Ironically, a tested and proven winning strategy (preached by successful investors and authors) is to hold for as long as one can. My thoughts now are:

1. Unless one is a big moneybag in this market, one would have to choose between cash flow or growth.

2. An AI bubble might happen soon or late, and positioning well now might be the best way to avoid buying overpriced stocks on news that were once rumors.

Who is trading/investing in any of GOOGL or AMD? My BE are 120 and 86.86 respectively, and I'm considering selling because there might be more pullbacks in the near future that would allow me buy back lower. I'll appreciate any thoughts or advice. I'm holding these ones for:

1. The sake of a likely AI bubble in the market which might mimick the historical dotcom bubble. (Is it also possible that AMD pulls an NVIDIA stunt in a near term?)

2. Long term prospects with regards cloud, AI, exponential developments/expansion in this sector, etc. for both growth and value sake.

Ades1:
😂😂😂😂 poor man, calling other poor…. CEO of of a public company spending more than he makes but we should not ask questions? No wonder Naija is where it is and almost hopeless.

The path/route to success of any top official of a tier 1 bank who cannot raise N500million by using their resources (access to loans with privileged terms, returns on aging investments, relationships, sales/lease of assets, etc) to key into a sighted opportunity/investment might be questionable.

hisexcellency34:
The company's share price has been on standstill after the terrorism funding admission

Hmm. Thank you for the pointer: good point.
I'm just looking at the future through the lens of company growth.

WAPCO seems to me, a great company with increasing revenue, FCF, cash. Finance costs put a dent in the EPS (when compared to Q3 2022), and we might expect to see its effects on proposed dividends for FY23. Unusual finance costs are sometimes brilliant strategic moves!

In my opinion, EPS is far from the best metric in the face of unrepentant inflation and currency devaluation. One needs companies that boast of increasing cash and an effective managament team (reflected by impressive growths) in the face of these harsh economic realities.

Is Presco likely to present an opportunity at around N160+, or we should expect better opportunities in the near term? I was happy to see my buy order @181 yesterday was rejected.

What stocks are people buying/accumulating at these current prices?

YoshihideSuga:
I'm curious, why would someone abroad use dollars to invest into companies which are generating their revenues in naira? Is that financially sensible? Investing in the NSE makes sense if the investor generates his cash/earnings in naira, not dollars.

Good point! But I'll share my thoughts:
People who took advantage of the scholarships in Western countries in the 60s, 70s, came back to Nigeria armed with education that afforded them top positions in government and private institutions. Many of them were able to make names for themselves and get into politics for elected or appointed positions, or became household names in their fields (legal, health, financial services). I think deployment of dollars or any currency to position well in companies that will last decades/centuries is one of the evolving ways of returning to Nigeria for the new generation emigrants.

Another way to look at things is that many emigrants use their hard-earned dollars to purchase houses they will never spend 30 days per year living in; not generating any cash flow either. The return on investment might continue to diminish due to devaluation, but not all investments are for income purpose only. Certain assets open doors and earn someone a seat in certain places.

Phlinx:
These are the theoretical answers provided from your links.

No one can give a simple answer in their own words without providing a link?

I agree that this question is as complicated as "What determines who wins Nigerian presidential elections?"

Please tell us the answer if you know the answer to your question. If otherwise, you can let us know whenever you find the answer.

Plenty cruise dey this forum . Same way we are asked to reflect on whether we are investing or speculating .

Agbalowomeri:
Lol same way the dividend will be devalued so not cheaper

That's a good point.
Still, stocks remain arguably the cheapest of all asset classes (other than storage of value in foreign currency) when considering the perpetual Naira devaluation.

Buying Lafarge WAPCO at N29 when $1=N1000 is technically cheaper than buying same at N24 when $1=N700.
Being too strict with BE price sometimes makes one miss opportunities.

The Company mentioned is just for reference, not for recommendation or warning sake.

A lot of emotions and reations flying up and down either like directed or orphan stones. When all faces are smiling, please try to ask questions from the few that are frowning, rather than attacking them. Some recent comments by popular contribitors on this forum have been treated with dislike - or subtly referring to their posts as wishes of dooms. One needs to be calming down small small, especially because the posters are invested in the same market too.

Just for optimistic persons who feel attacked by such posts, I came across these quoted meals below while going through some posts by gurus (TA, FA, experience) in a bid to educate myself a little.

RabbiDoracle:
Buying at cyclical bottoms give superior returns than cryptos. Find those bottoms.
In 2022 and 2023, we will easily see 2,000% to 7,000% in some names on NSE.
All emerging markets need to go parabolic. It will be a bubble of immense proportion.

RabbiDoracle:
Market is bullish. All Emerging market. The seed has been sown long ago.
F - 50
U - 40
G - 90
A - 60
Z - 75
2Fs - 15
And many more.
This is a possibility based on TA.
Impossible is nothing.
Do your due diligence.

Massive money multiplication (MMM) might go round as it has been from one stock to another : FBNH, JAPAULGOLD, TRANSCORP, U.G.A.Z., DANGSUGAR/NASCON, OANDO, others. It has been one after another, so why worry?

The emphasis on seeking knowledge is very important because it is a privilege to experience an across-board exponential gain in stock prices and it is in my opinion, also a privilege to experience the opposite. It births an "old wine" investor/trader. Seek knowledge and pick wisdom from the experiences of others (or yours as the case may be).

"For to every one who has will more be given, and he will have abundance; but from him who has not, even what he has will be taken away". — Matthew 25:29 was referring to rewards for use talents and that has a meaning in every area of our lives. Talents in a general bull run might mean capital.

May the bulls favor my household, and may my little capital not be used as election campaign funds as I navigate this season of everyone being an expert at trading. Oga Rabbidoracle described this season as "when your barber and newspaper vendor are advising you on what stocks to buy,....". Let us enjoy the game, make friends, build relationships whether faceless or otherwise and remain focused on learning and making money. There's a lot to learn, after which might come a lot to earn; in that order and not the other way round.

Owo ti omode ba koko ri, akara lo fi nra

Iamblessed85:
Wow greatly appreciate this. You have no idea how helpful this is. Many thanks. I always felt these techniques dont work for naija stocks o😁. Apparently i was wrong

I agree you might be right because Naija stocks have their own mind just as you and i know that vital figures in financial statements can be encrypted, and its one of the reasons I always seek opinions despite what the maths says - the elders see much farther even while sitting than a learner would while standing.

Iamblessed85:
I’m very much interested in learning how to value stocks. Could you help with pointers in this regard. What books can i read?

I think a great book is "The little book of value investing" by Christopher H Browne. Basic and enlightening.

On intrinsic value as someone has pointed out, I use the financial metric described here.
https://www.fool.com/terms/i/intrinsic-value/

Predicting the earnings growth rate is its limitation though. It works quite fine when trying to determine how much to pay for stocks. For foreign stocks (on other major exchanges) have many resources such as forecasts by major investment banks, which are very helpful, but some people like to use average growth rate over a number of previous years. The FCF approach is a little complicated as many people who trade stocks don't even know how to or don't care to estimate FCF basically in the first place.

Going through financial statements helps with extracting figures for many of the metrics needed for valuation. That in itself is an informal valuation approach.

Mfunkynation:
Yes sir...
don't wanna miss it as I miss Ucap impressive dividend

Thats a great move!

Mfunkynation:
Damn .....
You are wise

It is difficult to know if that's sarcasm in your comment my oga . I really need that between-the-lines insight so i can be well informed. The opportunity cost of not investing in Fidelity or FCMB over the same course of time needs to be rewarded by future prospects at least.

I won't mind hearing your view on AFRIPRUD sir. Are you also going long on it?

Mfunkynation:
Darling 😘, I have some bad Prudentially Africanism in me.

I have been meaning to ask questions about AFRIPRUD (the company) for some time now. From the dividends standpoint, I think they will struggle to pay 50k for FY2023 as in the last two years. Expenses keep diminishing the net earnings, and if I am right, cash reserves increased in Q1 2023 but reduced significantly in Q2 2023. currently at about 21k net earnings at H1, 50k dividend seems impossible at FY. I remember bringing up my concern early last year and Pa emmanuelewumi mentioned that we can give them two years to see improvements (he also mentioned how the CEO moving to UCAP changed some prospects). I was thinking the technology arm might mean more growth and more innovations based on global pace but I think the more I try to look, the less I see.

My UCAP dividends for the last 5 years have consistently been used to increase my position in AFRIPRUD and seeing as Oga Currentprice even mentioned the stock as one to keep on watchlist, I felt more convinced that my additional investments of spare cash every now and then is a good move. I believe Afriprud share price will fly when its time comes regardless of what a novice like me sees or does not see.

I particularly seek insight about the company's growth and current standing from gurus here. Thanks for all contributions in advance!

emmanuelewumi:
A wise man said, making money is activity based, it requires energy and efforts. That is where 90% of us belong to, that is the making money stage.
Managing money, keeping it and sustaining the money, is behavioural and psychogical
Multiplying money and growing it, is intellectual and also requires wisdom.
No wonder Warren Buffett is a very wise man .

Wise words! I remember you once said this here: "when a man with money meets a man with experience, he gives his money to the one with experience". I'll like to add that when the man with experience meets a man with wisdom, he pours his money and experience into the hands of the one with wisdom.

Thank you for expatiating on the proverb in your follow-up post sir. May we all arrive at the destination we call wealth in good health of mind and body, without losing any essentials of life.

vacanci:
i like the flow of your narrative..
thumbs up

Labdi69:
Nawaoo. People are intelligent sha. Nice write up

I appreciate the kind words bosses.

Ades1:
No matter how lucky you are or how massive your returns are, 700 milla no be beans! And that's in whatever currency you want to convert it to lol! Even if the person enjoyed 20X returns, that's still a lot of their money they had to invest! That man tried, it's not easy to stick to the plan through good and bad...

Absolutely! I agree with you 100% boss. And that's what I meant by " we might as well say that he started with 5k in 1998...", meaning if multiplying capital in the market is all that's needed, everyone would be.....
And further, having bonds worth 650-800M might not mean that's all he has built over the years: the house or estate one lives in, other businesses, cost of children's education, philanthropy, calibre of friends, etc. are factored into one's finacial worth/empire. And if gathering 700M is easy, how about keeping it, talk less of growing it? To each his own definition of wealth and the path to it . Grace does not even need to know whether someone has a plan or sticks to it - kira kita o d'ola....

phoinix:
LOL. To get to 8 million naira per month, it is very achievable if there is a good plan and a fair amount of luck . 8 million naira per month is 96 million naira per year. The dude claimed that a 25-year bond is giving him that 96 million naira per annum, assuming a 14% yield. This means that he has a principal of 685 million naira.

From 2020 to the present, 2023 , a very astute investor would have multiplied his money by 14 times just by following tips from the top-rated gurus on this forum. Let's assume that he has been investing for years prior to 2020 and had built up about 50 million naira....

You may argue that this is a very remote case, but he could be the one in a million who did just that . LOL

Nice calculation!
I put those lines in bold because they summarize why there is much more to 25years of building wealth than being lucky to enter NGX in 2020. We might as well assume that he started with 5k in 1998, and got things right to build it to 50M in 2020. Many minds will lose the motivation to invest in this market when the current euphoria is gone. That man's response has a lot of wisdom in it. He has defined his own wealth (not to be compared with anyone's (not even Dangote). If the current events on NGX is a true representation of how the capital market works even just 50% of the time, all the businessmen/women in Computer village, Alaba and the rest would have closed their shops decades ago to be following NSEMPA thread day and night.
25 years has seen the Dotcom bubble in Western markets, the 2008 recession, COVID19 pandemic, the many bonus shares of FBNH and its rise and fall through N33 and N4, the IPO's of defunct companies, the delisting of companies perceived to have potentials, the greater than 10X devaluation of the Naira, the hike in fuel price from N40 to N600, and many other economic stories. We cannot discount all the decisions that an investor made during each of these events, the choice to keep servicing a loan just because money needs to be keyed into generational low opportunities, predicting when cash is king or when to sow, calculating when to invest for dividends or capital growth, the choice of alternative investment decisions such as real estate, money market, forex etc, the choice of being greedy when others are careful or vice-versa, and many more.
Compared to all I have listed, a 2020-born investment portfolio is a virgin. I know of many people who saw the upward movement of stock prices in NYSE during the later days of COVID19 coupled with the certainty of perpetual Naira devaluation and sold/liquidated their Naira- denominated property and investments to become "traders". Many are still bagholders till date. We see new monikers asking everyday how to transfer their "abandoned" holdings to new stockbrokers houses or how to open accounts. A question to ask is why did some of these investors run away from the market after the 2008 recession, only to come back when the ovation is loud (another wrong move anyway)?

NB: This is not intended to attack the calculation nor to question the post - I respect both. If I come back in 14 years time (my own 25 years of investing) to share how successful I have been through Grace, hardwork, smart work, tenacity and all, and someone does a quick arithmetic of how I could have put 200k in FO to cash out 2M, put that in MMM to cash out 8M, put that in FBNH to cash out 20M, and so on, I might run to oga Mankindman for lecture on how to deactivate my account.... just kidding.

pizapato:
Hopefully we can get to the stage where someone will not need to fill e-mandate before getting their dividend. I believe the issue of having to complete e-mandate is discouranging some people particularly those in the diaspora from investment in NSE

I believe we will get to that stage in less than a decade.
I agree with you 100%. It is a pain.

chukel:
VCM is bad

Thank you for the suggestion.

jceesquare:
You can't be too sure. Yes a faulty VCM might cause poor acceleration and all that because the engine is running on fewer cylinders, but jumping to a conclusion without physically diagnosing the car would be same as throwing parts at it.
Capitas7 you'll need a professional bidirectional scan tool to run a full system diagnosis and check live scan readings to know what's wrong with the engine performance.
For the rattle noise, only a test drive on different road surface to simulate your complain would help direct your technician on where to check.

Thank you for this explanation and will do as advised. The issue I have with the dealership technicians here is that they sometimes give quotes to solve problems other than the one being complained about. It has happened to my wife in the past (two instances within the last two years). I think I need a stand-alone (one-man business) technicians to do the scan and test-driving. If I understand your point correctly, the result from the scan I shared is because the scan device is not sophisticated enough, right?

chukel:
you are right. Not for certain it's VCM but one of the possibilities. Since there are no codes, it could also be fuel pump. He needs a thorough investigation.

Thank you for the additional notes. I will share here, whatever they say it is. I am hopeful it is not beyond what the three of you have kindly suggested. My greatest fear has been transmission issues.

We are enjoying e-dividends today because of the efforts of some people who knew their rights. The experience keeps getting better with more people who know their rights and won't stop till they get the convenience that they deserve/desire.

talk2me2:
they are not being held with glue in that company they should learn to sell and move on if they can not wait .

There are many lawsuits filed by and diligently/persistently followed by shareholders (regardless of how little their stakes are) in markets in many countries where the rule of law and fundamental rights are not taken for granted. Bunge, a company in the USA has finalized talks and works to aquire Viterra (some still call it merger), but farmers who supply the grains that these companies proces and export are the ones protesting against the approval of the acquisition because they believe that it will strengthen the former through monopoly, resulting in the former dictating prices at which farm produce will be sold - farmers would have no control over how much they sell their produce to the giant company(s) anymore. Plug power is another one. Shareholders filed a class action suit because the management shocked them with much below expectation results in the face of obvious growth and positive buisness outlook/environment.

These two cases that I cited are just the ones I paid good attention to. If one is to go by your opinion, how would one then explain how suppliers of raw materials identify their rights to block an acquisition, or how shareholders identify their rights to question the financial reports that the management is feeding them?

Once we sell ourselves cheap, we can never be listed at our actual value ever! - a popular adage.

Those shareholders protesting the First bank AGM matters know their rights. People should not have to sell their shares because the management team is acting funny.

yMcy56:
Somebody said up there that he exposed his number....
The only number I saw was that of the follower....
* Meaning: He's also the follower with another moniker.

oh wow! Reverse techniques in advertising. Country hard ma.
We Meritrade users miss your detailed market updates - just to chip that in.

YoungBuffet:
Stories! Whatever you get on those per share is not up to 0.40$ and the stock that has done around 300% is going to $10 which is around 3000% that is just a stock in my portfolio and am also withdrawing my gain at almost 900/1$ so dey play😂😂😂😂😄

You are doing well, brother. Your hustle energy/spirit is commendable. Followers have even started asking to be shown "the way".

But you too like to dey insult person sha. Your response must show that the receiver is a baby - its a pattern already, smh. I rather ignore those parts of the comment. These kobo kobo comparisons are truly funny as one oga said though. How many 40cents will pay auto insurance, gas or electricity bills?

Building of wealth is a marathon, while chasing of bread is a sprint. Many are in for a marathon, hence their ideologies and approaches to investing/trading. Marathon minds spend years accumulating, building a portfolio of portfolios. Someone who has loads of hard-earned dollars in investment is already thinking of inheritance (a heavy will), constantly evaluating their financial worth, taking stability as a priority and not risking their fortune on an app that can pack up tomorrow morning, nor investing in kobo kobo "US stocks" that have no institutional investors, are not in the portfolio of any index fund, lack sound fundamentals, but have prospects of 1000% reward. It similar to selling one's assets to go spend a Friday night at a casino in Ocean city NJ.
All hustle na hustle. Neither of the two is superior, but mutual respect makes us all do good in the markets together.

PS: my use of kobo kobo does not refer to all penny stocks. Neither is it to condemn them.

YoungBuffet:
Una Weldon ooo I agree with the guy that said here that one needs to earn in Dollars I followed a guy buy one US stock, currently doing close to 300% in less than 3 weeks. When am done una go sell una stock for me cheaper last last

Good reward, boss. Enjoy your loot.
Remember many people here invest in more than one market. It feels good to pocket 300% from US stocks, but it also feels great to pocket both US market gains and ride Access from N10 to N18, UBA from N8 to N15, Transcorp from N1+ to N4+, GTB, Japaul, many many more like that. Some people just can't forgive themselves for missing out on such opportunities, some other people just enjoy the feeling of "I was heavy in the market when new highs (above 65k ASI) were reached". When the "lows" arrive, both the people on the sidelines and those already in the market will still pick at good bargains. And if the "lows" never arrive in a near time, it's no regrets for those already in the market.

IYGEAL:
With all the traditional stock brokers, why would you want one whose legitimacy needs clarification?

Yochaa is legit as legitimacy goes. But it doesn't have direct access to the NGX and therefore uses another traditional broker for its services, which, of course, adds another bottleneck and resultant charges.

Those "non-traditional" brokers allow you to open accounts even if you don't have certain SEC requirements such as NIN, and maybe BVN. People who were already in diaspora when these identities became mandatory have no choice than to do many things the"unconventional" way. More risks unfortunately.

OBAGADAFFI:
Yea I just noticed it.

It might be due to the acquisition of SAIT.

The Company in 2021 acquired 100% interest in Siat Nigeria Limited.

There was a huge increase in investing activities and retained earnings increased despite the acquisition or even increased dividend (FY 2021 being referenced).
I agree with you sir, it might not be so bad of a performance unless compared to its pair.

The three scary highlights for me are:
1. Significant jump in administrative expenses and finance cost - the earlier might be due to increase in personnel size.
2. How deep a grave could the increase in borrowings (non-current, which I believe/assume is not unusual in this line of business) dig for the company with the current outlook of increasing cost of running a business (worsening forex rates, increasing cost of fueling machinery, etc)?
3. The exchange loss reported might be nothing compared to what is expected in the current year.

My concern is that many of these companies might have a rough (and maybe disappointing, at least to a surface observer) couple of fiscal periods before we start seeing "impressive numbers". What business would not have a tough time given the current global and local economic events anyway?

Times like this will surely come and go; resilience could be a virtue.

Mfunkynation:
Let it come down more Uncle
Opportunity

That's a nice strategy.

It seems there is an explanation for the reduced/negative EPS of Dangote sugar. There was no trace of reduction in overall performance or health. The bug that makes some cows fatter makes others leaner - this common threat is affecting all businesses.