₦airaland Forum

emmanuelewumi:
That is why I said somethings can't be explained, retained earnings, ploughing back into the business with sensible leverage works like steroids in the growth of a business.

What do you mean some things can't be explained? Do you think we are daft here?

We know what retained earnings means and what it can be done with. We know it is used for expansion, development and growth. That depends on the management.

What happened to your retained earnings in Oando, cadbury, FBN, Skye, UBN?

If management don't know what to do with it, share the money.

RabbiDoracle:
Depending on how much you bought. If you bought 10 unit of a stock at N50 ( total amount invested will be N500), and they don't pay dividends, all you need to do is just to attend their AGM. At the AGM, they will give you food worth more than N500 and some corporate gifts. That is how you will recoup your investment faster.

For those that have heavy units, they will just sit it out and wait for capital appreciation.

Sir oracle

RabbiDoracle:
Depending on how much you bought. If you bought 10 unit of a stock at N50 ( total amount invested will be N500), and they don't pay dividends, all you need to do is just to attend their AGM. At the AGM, they will give you food worth more than N500 and some corporate gifts. That is how you will recoup your investment faster.

For those that have heavy units, they will just sit it out and wait for capital appreciation.

Sir oracle

Deadlytruth:
If you have the stamina and patience, you can start reading from page 0 of this thread to this current page 3057 and you will get answers to at least 90℅ of your questions.

Orúkọ ń rò ni. Who gave you this moniker

Coolcash1:
Earnings belong to shareholders and not company. That is why profit is a liability to a company and not asset. For business expansion and growth, management prefers to retain a percentage of the earnings and pay out the rest as dividend. The retained earnings is used to then create value for shareholders to increase the worth of their investment. This is what is called Internal Rate of Return (IRR). Put differently, IRR is the return in excess of company's WACC (weighted average cost of capital). IRR of pure equity financed company is usually lower than that of a debt finance one. Thus, return on investment is both dividend and capital gain (arising from undistributed profits)..

Ok..Musa invested 1m into a company X and ought the shares at N1. The company declared profit of EPS of N2. The company have shareholders dividend of N1. If the company is trading at N5, the book value per share of the company is N7

(1) calculate the PE of the company
(2) calculate the dividend yield
(3) calculate the Company ROI
(4) calculate Musa's return on invested amount.

please et all,
why is there such difference between Zenith (31N) and Guaranty (49N)..
been looking at Q1-3 2017 results..not much difference..
so why the difference?
thanks

RabbiDoracle:
What do you mean some things can't be explained? Do you think we are daft here?

We know what retained earnings means and what it can be done with. We know it is used for expansion, development and growth. That depends on the management.

What happened to your retained earnings in Oando, cadbury, FBN, Skye, UBN?

If management don't know what to do with it, share the money.

Where the money is usually drained.....

emmanuelewumi:
That is why I said somethings can't be explained, retained earnings, ploughing back into the business with sensible leverage works like steroids in the growth of a business.

isnt that exactly what these insurance companies are doing?

hiding their earnings in expenses column and fines.

No dividends, keeps the investors funds locked in with them.. If you sell you loose the funds anyways.. So...

thank God i read wide about them and avoided that snake food one of them is cooking!

DeRuggedProf:
Where the money is usually drained.....

Nigeria investment terrain sometimes doesn’t give room to some of this theory stated by Oga Emma. A lay man understanding of ROI (particularly Nigeria investor) is dividend declared, bonus and capital appreciation. Some of these money ploughed back as retained earnings go under the water as Times goes on especially when you have a shark as management or board of directors. Greed and self centered lives in the heart of some of these people. Case study is Cadbury, Oando, Oceanic, etc.
You can see why an ordinary Nigerian investor can’t trust NSE for long and especially some of these results presented (audited).

Kudos to all the Ogas’ in the house for these analysis...

Chibuking81:
Interesting, you really made a good point.
That's why am advocating for the law that will mandate them to pay from their declared EPS, minimum of 40% and maximum as they agreed to their investors, by so doing, we shall know the really earning of the companies. That will make the companies to come clean with their really earning per a share, per annum.
It will go a long way to bring sanity to the market, and place the companies where the belong, according to their value.

If cunny man die cunny man go bury am... They'll make sure they spend all the part of the earning they want to retain on assets...

DeRuggedProf:
On NSE, a low p/e normally indicate a company is on life support....
It infact estimates the remaining years for the management to finally finish milking it.....

Not always. Don't you guys do research at all.


Look at this scenerio

A company X had a

Revenue =N120m,
Debt= N40m
PAT = N1m
Price = N4
Outstanding shares= 10m

PE is 40

The company did a right issue to lower debt and added 1m extra units.

After some quarters,

Revenue =N150m,
Debt= N5m
PAT = N15m
Price = N4
Outstanding shares= 11m

PE is now 2.9

Once this results comes out, people will.rush this stock and send the price to the roof.

So not all low PE companies are dead.

Also if you do your research, people will key into stocks before they release wonderful results. That is why Pa Emma keys into these rights because he has done his research.

#expo

emmanuelewumi:
That is why I said somethings can't be explained, retained earnings, ploughing back into the business with sensible leverage works like steroids in the growth of a business.

What do you define as a sensible leverage?

presiade:
If cunny man die cunny man go bury am... They'll make sure they spend all the part of the earning they want to retain on assets...

Who wan retire from board and leave behind the honey and milk....

DeRuggedProf:
I only started making money on NSE when I blacklisted ALL listed companies!
Having it at the back of my mind that NONE of them cares about me freed my mind to face the game like a war.
They retain big profits, before you know, they are back here requesting for you to bail them out by issuing more shares in rights issues.
Diluting you every now and then...

It shows they don't manage then well.

Or they engaged in risky venture that took the money away.

Or they are expanding and still need to expand more.

DeRuggedProf:
I stopped short of calling their names.....
Low p/e can remain low for decades until the 1K rule resets it....

That is why a cheap stock can be very expensive. Imagine people that had held insurance at 50kobo for like 8 years. No going up, no coming down. You can't sell because no one wants to buy.

This means that the 50kobo stock is very expensive.

DeRuggedProf:
Who wan retire from board and leave behind the honey and milk....

Dem go auction/arrange the assets (eg official cars, buildings) cheap for themselves before exiting...This na naija...

RabbiDoracle:
What do you mean some things can't be explained? Do you think we are daft here?

We know what retained earnings means and what it can be done with. We know it is used for expansion, development and growth. That depends on the management.

What happened to your retained earnings in Oando, cadbury, FBN, Skye, UBN?

If management don't know what to do with it, share the money.

Carl Icahn told Apple to share the money or do a share buyback if they don't know what to do with it. Some management just sit on it.

RealityShot:
please et all,

why is there such difference between Zenith (31N) and Guaranty (49N)..

been looking at Q1-3 2017 results..not much difference..

so why the difference?

thanks

Efficiency and quality.

French reporters asked Ibrahimovic why they are paying him 1m euros per month. His reply was : Quality! They are paying for quality!

RealityShot:
isnt that exactly what these insurance companies are doing?

hiding their earnings in expenses column and fines.

No dividends, keeps the investors funds locked in with them.. If you sell you loose the funds anyways.. So...

thank God i read wide about them and avoided that snake food one of them is cooking!

My dear, they don't use the money for the benefit of the shareholders. That is why I'm an advocate of sharing everything as dividend. You can't manage bthe money better than I do. So don't start telling me that my investment is still well.manage.

Now if they say that my investment is still well managed by them, what if I sell, what happens?

Remember that they gave me part of the EPS as dividends and retained the others for me. Can I legally go there and collect it (following Emma's line of thought).

Omo, na wetin bird chop e go carry fly ooo.

Godisfaithful:
Nigeria investment terrain sometimes doesn’t give room to some of this theory stated by Oga Emma. A lay man understanding of ROI (particularly Nigeria investor) is dividend declared, bonus and capital appreciation. Some of these money ploughed back as retained earnings go under the water as Times goes on especially when you have a shark as management or board of directors. Greed and self centered lives in the heart of some of these people. Car study is Cadbury, Oando, Oceanic, etc.
You can see why an ordinary Nigerian investor can trust NSE for long and especially some of these results presented (audited).

Kudos to all the Ogas’ in the house for these analysis...

For you to see how bad it is, when you ask people how long they want to invest, they will say short term. You will say you mean 1 years and they will reply Noooo. That 1 year is long term. That their short term is max. 3 months!!!

Just negodu

DeRuggedProf:
Who wan retire from board and leave behind the honey and milk....

Till today Pa Emma is still angry with Bunmi at Cadbury. If Emma sees him at Ojuelegba, I know gidigbo will ensue

RabbiDoracle:
Efficiency and quality.

French reporters asked Ibrahimovic why they are paying him 1m euros per month. His reply was : Quality! They are paying for quality!

Absolutely correct Sir. The question is how many Nigeria company can pass “quality test control” of long term investment?

This a week of JUDGEMENT.

We should expect a heavy rainfall that will beat both the Rats and Lizards.

*ThE OcToPuS*

PETERiCHY:
This a week of JUDGEMENT.

We should expect a heavy rainfall that will beat both the Rats and Lizards.

*ThE OcToPuS*

Oga Peteru, do you remember this song, “There shall be showers (rainfall...) of blessing, this is the promise of God...”

shigidi:
What do you define as a sensible leverage?

Debt that is within the ability of the investment, business or investor to pay back and there will be reasonable profit margin after paying back the debt.

DeRuggedProf:
On NSE, a low p/e normally indicate a company is on life support....
It infact estimates the remaining years for the management to finally finish milking it.....

I don't do insurance companies, most of them don't pay out 10% of their earnings as dividends. The return of equity from most of them is very low.

But some guys are making good money from stocks they understand who have low PE, UBA and Access at a PE of less than 3 and a dividend yield of about 25% was a good buy.

PETERiCHY:
This a week of JUDGEMENT.

We should expect a heavy rainfall that will beat both the Rats and Lizards.

*ThE OcToPuS*

People who do penny stocks that are on 50k for ages, should take note.

RabbiDoracle:
So your point? Does it mean that dividend isn't a way of measuring shareholders' Return on their investments.

Like we mentioned, there is also capital appreciation as well.

since the profit of a company has been devided by the shares outstanding to arive at the eps, I always wonder why each shareholder is not paid= the eps multiplied by his number of units he possesses in the company. And if the company wants to plough back the total profit or a percentage of it, it should be clearly stated, with the calculation done accordingly. But for a company to be making profits and not paying dividends, e get as e be.
I also feel that the eps should be calculated by averaging the earnings of the comp for 4 quarters. That is = 4 quaters earnings ÷by 4 =×.
p. e. should now be ; price of the stock divided by ×.

what I think is logical

The 1kobo rule begins tomorrow, which of the 1kobo stocks can you boldly add to your portfolio?
I might consider Lasaco

Godisfaithful:
Nigeria investment terrain sometimes doesn’t give room to some of this theory stated by Oga Emma. A lay man understanding of ROI (particularly Nigeria investor) is dividend declared, bonus and capital appreciation. Some of these money ploughed back as retained earnings go under the water as Times goes on especially when you have a shark as management or board of directors. Greed and self centered lives in the heart of some of these people. Car study is Cadbury, Oando, Oceanic, etc.
You can see why an ordinary Nigerian investor can trust NSE for long and especially some of these results presented (audited).

Kudos to all the Ogas’ in the house for these analysis...

I don't do theory. In the stock market you lose some, you gain some. But your losses should not be more than your gains.

I sold my all my Oando shares for between N22 to N25 when the figures didn't add up, that was before the COP deal , i even wrote a petition against the company to NSE and SEC.

I didn't have Oceanic, I sold intercontinental Bank for N42 when I found out that the earnings couldn't support the price.

The only Bank stock that I lost money was Skye Bank, which I bought at over N7 and sold for about between N1.40 and N1.60

RabbiDoracle:
My dear, they don't use the money for the benefit of the shareholders. That is why I'm an advocate of sharing everything as dividend. You can't manage bthe money better than I do. So don't start telling me that my investment is still well.manage.

Now if they say that my investment is still well managed by them, what if I sell, what happens?

Remember that they gave me part of the EPS as dividends and retained the others for me. Can I legally go there and collect it (following Emma's line of thought).

Omo, na wetin bird chop e go carry fly ooo.

What about the debt you left behind �

DeRuggedProf:
I stopped short of calling their names.....
Low p/e can remain low for decades until the 1K rule resets it....

The 1k rule will make the PE lower, but I am of the opinion that some people will make good money via this rule.

RabbiDoracle:
For you to see how bad it is, when you ask people how long they want to invest, they will say short term. You will say you mean 1 years and they will reply Noooo. That 1 year is long term. That their short term is max. 3 months!!!

Just negodu

Omo one year for naija na long term o