₦airaland Forum

RabbiDoracle:
Careful bro.

Look at banks individually. And you will see some signs.

lol early in the morning i beg make una no kill me for NSEMPA

the situation na truly 69 as someone said

distinguishing factor is whether u a invested (or d extent thereof) or not

My Ogas i beg make una no kill me

NSEMPA is a treasure trove for any student of Behavioural Finance

austinkenneth:
The big seller in Zenith is stepping down gradually in steps of 50 kobo

The guy is just an unserious fella

instead of make him come our junction (17) make we help relieve am of the heavy load wey hin carry

Na headache go finish am for that junction (18.5)

RabbiDoracle:
This doesn't look like bull yet o. It rises for some weeks, it falls afterwards and alternates.

The market is not easy to make calls.

Trade safe. Stay on banks. If you are trapped in it, you will just be enjoying dividends. Buy price is key to enjoying a good DY.

My Oga dont tell me you are abandoning the ship ooooooo

Joke apart the best in this market, for now, is to go for dividend (doing well to look at the yield vis a vis money market)

The macro is not supportive of any sustained rally for now (so it i.e. rally is going to come in fit and bits)

My fear is that the Macro itself is deteriorating (copy recent Moody downgrade) though there are few green upshoots in the macro but these upshoots are still below thier potential

my prayer (and wish) is that as we go into the new year these macros should improve further or at worst not deteriorate further

Only then could we be talking of sustained rally

Jejebabaa:
Boss, u better pray for me make I no file for bankruptcy. If devaluation meet that loan, na serious yawah be that ooo.

My Oga i know wan blive say devaluation (whenever it comes) wld meet u on d loan

d second base wey oga oracle dey usher in i blive wld come b4 any devaluation. u can bail out as soon as d second base come and pay out the loan (while enjoying ur gain therefrom) so that the negative (of devaluation) does not meet u on d loan

RabbiDoracle:
Something that was at 16 for a long time, now it took off and you are still at the bus stop waiting.

If December accelerates, any profit taking will not dent the price. All bank stocks are cruising above the Kumo on the daily ichimoku.

Further rise in December will mean that they have started cruising above the Kumo on the weekly. Access is the only bank that is comfortably above the cloud on the weekly.

Once a stock is above the kumo, profit taking will only bring it down a little but it is still where it is.

i bought d little that my cashflow cld sustain then

na because more cashflow come now i wan buy again

my oga just pay me my gateman salary unlike una wey dey collect FAAC allocation monthly (blackgold things)

i even beg oga jejebaba then make him include me for hin foreign loan (like baba buhari own) wey hin dey arrange then but he use style dodge me

make una help me beg the chinese man make him come my yunction, i beg because me self wan enjoy dis second base wey dey come (make una no enjoy alone)

nna777:
Those our Chinese guys are back .

d guy no serious instead make hin come meet us for our junction (17) he dey carry d kaya for head dey wait at 18.50

na headache go injure am for dat junction with the kaya wen hin carry for head

if hin like make hin no come our junction make we help am relieve am of d heavy load wey hin carry for head

sellydion:
I tire for the clone jIm

the guy is just unserious he shld sell back to the 17 region if he want to get the kind of volume to clear him out (at least at that region before he was able to get triple digit million sales). im sure those that have already clock out of some stocks that had already made sizebale climb wld be very interested at that region

then let the thing move afterwards

what is this his style of dying a hundred time? with piecemeal / pieces selling

nna777:
My intention was not to cause panic oo. If it seem that way, I apologize.

i beg cause d panic

dey shld bring it biko

particularly at 17 below

we go manage am even if d NTB (their mainstay) fall lower

we are not dat greedy

RabbiDoracle:
People said so long as PMB is the president that here will be bears!

What is happening today?

Please who is the president?

i never belong to that category

i even bought more when they were shouting dat. i only stopped buying because fund was exhausted however i wld still keep my feet firmly on the ground and face reality

current rally is due to policy pronoucement (OMO shut out) and nothing to do with economic performance (best of 2% GDP rise)

with the notorious reputation of our goverment for policy flip flops, that pronoucement itself cld change but my take is that even if it does not change there is a limit the anchor (NTB) could go lower at which point it wld start impacting negatively on the FX rate (which is the scrotum of this govt) hence my take that the effect of the policy pronouncement wld eventually wear off

mendes911:
But I will say it was 50/50. Both of you won. GTB touched a new low within the period Agba said it was going to touch down.

But in all sincerity, there was no bull until OMO and TBills funds showed up. Am sure you know that already.

That was the Game Changer

but its a steriod that wld wear off as soon as NTB rate settle into the 8-10 band (mayb by q1 2020) because last last we (retail / local institutional affected by the OMO shutout) are only looking for avenue to pack our funds for YIELD

structurally (economy wise) nothing has changed yet


n.b note that the Anchor (NTB) mioght still go down further 6-8 before it comes back to settle into the 8-10 range so the market mightr still get more exuberant before the wear off

rebekah2011:
Oga OGG, Good morning to you. Is this your new way of recommending stocks? making money here is becoming more difficult oooooo. But come to think of it, who are those that are still buying stocks here? This period is harvesting time oooooo. If you have the cash to still invest, I do not think the cash will cry if you refuse to invest it. I cannot really see what has changed with the stocks except that we all hope the excess liquidity from OMO and NTBs will flow into the equities.

The thing that has changed is the shutting out of OMO and fall of rate at NTB

People should be careful of this thing cos its like admnistering a steriod / morphine, it wld eventually wear off

moreso a lot of the local institutional investors in the OMO space (shutout) wld gladly still take the 10% being offered at the NTB instead of equities.

so the ACTUAL effect in the equities space wont be as much as d figures (>1 trillion) being bandied so pple shld not get carried away (max of 10 - 20% of the fund dat were forbided from coming back to OMO wld flow here cos d rate on NTB though down is still tidy)

As for the NTB/365 itself which seems to be the new ANCHOR in town i dont see it going below upper single digit (8-10) because of structural constraint (local economy constraint / impact on FX windows which the issuer CBN/FGN is very sensitive of) and also international constraint (G8 rate movement e.t.c).

So my take is that recent happenings had drawn a clear bottom / resistance on the down trend of the last two years but there is nothing out there yet for a NASA like take off of the equity market, what we wld have at best (with the current impetus) is some few steps away from the bottom

mendes911:
Thank You Sir.

But if they are selling Zenith to key into others, am yet to see all the huge cash flow across. Sales in Zenith is already in excess of #20B.

As per Access, it's looking more or less like a P&. They come in from 1pm to keep the tempo of bull-like market. Any afternoon they fail to come, na that day breeze go show fowl yarsh.

We keep watching though. We go all make the money finally.

Baba i say again u na veteran.

People shld be asking hard and fundamental questions

what is d div yield at today price compare to the NTB/365 of 10%. (ok i hear dey wld say dey are pricing in the growth story in but na wetin i chop i sabi)

last last we wld all d alright

sellydion:
Where is our faith na? Him be Jim

u neva can say whether him na Jim ooo lol

mendes911:
Will 18 months work? Considering there will be April - October within that period.

its a spectrum and not absolute its as soon as objective (75 - 100%) is achieved (with a combo poo and vomit)

mendes911:
Chief,

How long is your long term play (considering your notion of poo and vomit)?

6 - 18 month (but entry point is d key here)

mendes911:
You of all people know that there are stages in this market.

There will be a period, I will buy zenith for N24 hoping to sell at N27 and make my 10%.

Life na turn by turn and in stages.

When zenith was trading at N19, you never saw it coming down to N16 and likewise what happened in GTB. For now, I will even be more interested in UBA than Zenith. I forsee overhead effect in Zenith. I could be wrong though.

Like I said, let us all play the market how we best deem it.

Shalom.

veteran

short term play (jijo / 1-2 month) CAPITAL NO cos of bolded

Medium tier play (1 - 6b months) Excellently (poo and vomit)

Long term play (above 6 months) Ultra Excellent ( multpile poo and vomit)

mendes911:
He should jeje reduce his price. This #17 no pure again. Whatever happened to #16.

Oga Mendes na u dey talk like this

u be veteran now

d guy went as far as 16 abt two/ three moons ago,

yday d lowest he went was 17.40

today before midday he had done 17.15 already

im sure he wld do lower 17-17.05 b4 d week close cos the remaining amount to dat range is 65m which is just a fraction of the 300 he just dropped

robobo:
who did that wicked dumping on Zenioth just now?

Deprof is it our chinese friend??


hmmmm Ewu be ni oko Longe oooo

Another one

who did that wicked dumping on Zenioth just now?

Deprof is it our chinese friend??


hmmmm Ewu be ni oko Longe oooo

mendes911:
Dangote Flours.

http://www.nse.com.ng/Financial_NewsDocs/28118_DANGOTE_FLOUR_MILLS_PLC_FINANCIAL_STATEMENTS_OCTOBER_2019.pdf

I hope there's no going back on this deal before Olams gets scared and runs away.

Payment commences from November 8.

TLAX:
That was all of it. It was a mail from one of StanbicIBTC staff.

ok trhank u

robobo:
God Bless you plentiful

quite insightful

Hello Oga TLAX / Aremso

i would appreciate if ypu oblige me with the full treport

Oga Aremso i wld appr8 if u can also help out

i tried gettiong it from the EFG Hermes website cut ld not apprenmtly because im not a client/ customer

TLAX:
Possible answer to bolded below

Conclusion: the sentiments are consistent across board

Response 1
You're shaking a broken table
Equity isn't a generic name in Nigeria. Nah not even a noun. As a name describes attributes and character of the underlying. PFAs have bought something hard to describe. The last 10 years has produced significant negative returns save for year 2013 and 2017. 8 solid years of losing money not in single digits but mid and upper teens.

If the money was left in cash it would have been better. If we add inflation considerations, your guess isn’t going to get there. You also missed the blatant destruction of value by unexplained, unexpected shut downs and nationalization of how many banks? Oceanic bank, Intercontinental, Bank PHB. Notably there is that special oil and gas company that is always raising money, Skye Bank - What did PFAs get? Zero. These were banks that had big 4 audits and CBN affirmative reports 3 months before an overnight take over. Check in and see what the industry lost
PFAs are fiduciaries and will not ignore the concerns of the plan owners who already live with the hope that these monies will amount to something. It's not risk-aversion but common sense. How do you stay invested in an asset class that drops to zero overnight . When PFAs complained about small trades (market manipulation) affecting portfolio valuations what happened? 2 nondescript brokers will trade 10,000 units of a stock and make a single PFA lose 2bn in one day. Is that a market?
There were 120 banks and over 300 insurance companies in this country at some point , where are we today. Has the market grown or we should just continue to plow in? Trust is a precious commodity. Once broken, in any relationship, It will take a long time to rebuild. That's happened in this market and unfortunately not being looked at.

Response 2
Greetings and good to read your write up as always.I asked the question after reading through; what exactly is the answer you are expecting to your question?
Where should the loyalty of PFAs lie? To the market or their RSA holders? I would say to RSA holders/members of course.
Do you Invest Longterm to destroy value or to grow value? Are Nigerian Equities positive for LT investors or value eroding? Look back 10, 15 years and you will come to the same conclusion that the majority of Names on the NSE are value destructive for a Long term Investor. Look at the 10 year look back that was published recently showing that only a few names outperformed inflation and devaluation, over the 10 year horizon; one banking stock – Guaranty Trust Bank, FCMG – Nestle Nigeria, two Agriculture Company – Okomu and Presco….
Also, we have found out that the so called equity premium does not exist for most names in Nigeria; certainly not in the last 15 years.
You raised the question on whether Fixed Income is risk free? The professionals know that nothing is risk free; not even US Treasury!!! However, there is the believe that if you are a Naira investor, and Nigeria does not implode or explode, the Federal Government will print money to settle Naira bonds/Treasury bills obligations if it needs to. Euro Bonds holders may not have such consolation.
I am not sure therefore that Fund Managers should put clients’ money at risk, just because they want to be or be seen to be LT players. This behavior will subsist until the Macros, the fiscal and the monetary line up, and rational analysis supports playing Long term. Till then……..
Anyway, I always enjoy your writes up, and I like the emotion behind them.

Response 3
For most PFA’s there is also concern that you could be penalized for performance below industry average. As result, if you are being measured against peers that have little or no equities (and you are heavy on equities) the possibility of having returns below peer average is high…this could come with penalties. I even think things could worsen once the transfer window opens…as managers may be under pressure to deliver short term returns.

From An Equity Salesman

God Bless you plentiful

quite insightful

Jejebabaa:
So this is what Agba is trying to avoid

No matter how great a company is or how amazing their earnings, a bear market is like a hurricane, it damages all boats regardless of how great they are. Defense is the best policy until price action finds key support and makes higher highs.

----Steve Burns

while im not a TA guru, this quote is quintessential and classical, the hurricane analogy says it all about a BEAR market it

aremso:
Nigeria IMI is trading at 4.8x 12m, thus making the country assets cheaper than ever a Fund Manager EFGHermes has said in what it called Nigeria Strategy note to investors. It said that Nigeria assets are on an all-time low. Our analysts forecast 14% earnings CAGR for 2019-21e with non-banks’ earnings recovering strongly in 2020 after a difficult 2019, and a 2019 of 10 per cent (11.2% for banks). Despite this, policy uncertainty makes it very difficult to become bullish. The latest government moves include the impossible-to-enforce closure of land borders to all trade and the CBN’s increase in minimum LDRs to 65%.

The latter policy may support earnings growth for stronger banks, but it is hard to reconcile policies that force private sector lending with those that severely restrict trade. These factors keep us UW on Nigeria relative to FEM peers – our preferred stock remains GTB, whose 3Q19 results demonstrate its ability to generate solid returns through thick and thin. We remain cautious on non-financials given valuations and current macro settings, with Nigeria Breweries being our preferred non-bank name. Flow data shows that foreigners have been net sellers for much of the year, totalling $106m YTD, though foreigners were net buyers of $16 million in August when MTNN was added to MSCI indices. More surprisingly, local pension funds have kept cutting their exposure to equities after a regulation change in early 2019 that eliminated minimum allocations to variable return assets. The falling equity share in pension AUMs is not just about poor market performance – comparing the profiles of equity AUMs and total returns from the NGSE Index suggest that pension funds are either: i) allocating no fresh funds to stocks, despite strong flows into pension funds N681 billion in 12 months ending June 2019; or ii underperforming the local index by a wide margin.

We understand foreigners’ reluctance to engage. However, even given high yields on government paper, we are surprised that locals with LT NGN liabilities are shying away from inexpensive stocks that offer good dividend yields and the potential for LT capital gains. We believe this could be because current incentives for pension funds do not reward managers for outperformance. Meanwhile, investors are asking again about the outlook for USD/NGN – almost unchanged for over two years – after the recent reserve burn. Current gross reserves of $40.0 billion (mid-October) are down $4 billion from the 2019 high, though they are still equivalent to a respectable nine months of imports. The fall in reserves seems only partly due to portfolio outflows: CBN data shows foreign holdings of CBN OMOs – the main carry trade vehicle – down just $600 million from their July high of $17.23 billion at end-August, though anecdotal evidence hints at a bigger outflow $2 billion.

We had wondered if the CBN was allowing USD swaps with local banks to lapse, contributing to the reserve burn, but the recent drop in banks’ NFAs appears to rule this out. Recent reserve and NFA declines likely have as much to do with the falling trade balance (latest 12m sum down to$10 billion in July 2019 from U$18 billion a year previously. Portfolio flows may still be a challenge in the near term: $15.4 billion in OMOs mature in the current quarter, around $5.3 billion of which may be foreign-owned (using August CBN data as a guide to total foreign OMO holdings). Maturing OMOs will have to be financed with rollovers or reserve/NFA drawdown. We note that previous stock market rallies have been associated with NFA growth and significant pressure on reserves and/or NFAs could mean another leg down for this already-inexpensive market. Meanwhile, the importance of portfolio investment for reserves mean that policy rate cuts, that could support equities, seem highly unlikely this year.

Hello Chief

God bless you plentiful for this

it was full of insight and hard question,
e.g August surge in foreign flow largely MTN driven (though it still doesnt explain that of September or could that be as per Airtel)
why are PFA not inclined to the equity market despite near certainty of outperformance in the long term
reconfirmation of the fact that NSE (rise & fall) is deeply tied / correlated to foreign inflow (NFA) e.t.c

whats d source please

mosbus:
8am-6pm

saturday only or inclusive of sunday?

Hello Mosbus

what is ur opening hours on weekend like?

Oga BBM

Kindly help with Dangcem and Zenith technicals for daily/weekly and monthly

robobo:
Sincerely sir the bull are around but people would be mistaken to think it would be as strong as 2017 / early 2018 cos the macro does not support that, not with a tepid 2% GDP growth (the equity markey is a forward predictor and it feeds very largely into GDP growth rate) and heavy fiscal deficit which are financed via money market that had been acting as a vortex sucking life out of the equity market. Like i told Oga Oracle some moons back funds had not ceased to enter the country since d equity downturn started in early 2018 what changed from then till now was that those funds were largely going to the money market space (check FSDH analysis of foreign fund flow for last 4- 6 quarters in Monday businessday for insight)

my take is that if time is factored in, the equity market is presently more enticing than the money market (read UBA / Zenith Access at circa over 10% div yield for 6 month which annualised comes to over 20% compared to best effective yield in money market space of 14-15%) hence the funds flow towards the equity market we are currently witnessing. however i would expect this to tank as the div yield effectively move down towards 14-15% annualised (i.e. at the point which prices gives div yiled of of -6.5 - 7 % yield e.g UBA at 7.5-8.5 with expected gross dividend of 65k and net of 58k time horizon for same wld be d next 4-5 months

These are my personal take and what currently guides my decision however as a flexible animal these guidance might change if the drivers change (i.e. GDP growth rate / foreign funds flow pattern / size & financing pattern of fiscal deficit).

https://www.abokifx.com/news/investment-trip-to-lagos-searching-for-dividends-africa-business-insight

Good read with lot of insight

Validate some of my thesis above

my take still is whatever/ whenever bull wld surface it wld be tepid and not last long becos of lack of strong macro to drive it

the sector available to play in very limited (largely banking and some few consumer conglomerates).

so we shld be very careful not to be carried away whenever the bull comes to town

DeRuggedProf:
When is Forbes doing its next ranking?
This info is critical for my timing here.....

i think its February though not too sure

im also interested

Oga Dipoolowo should know

Agbalowomeri:
Is the daily bowing to the cloud?
We watch

My Oga

we REALLY WATCH

i just hope the winter that is coming would not even be too cold for the WHITEWALKERS

mendes911:
Correct Sir.

Back to Stock business.

Do you believe BULLS are here or are we going to retest LOWS again?

Sincerely sir the bull are around but people would be mistaken to think it would be as strong as 2017 / early 2018 cos the macro does not support that, not with a tepid 2% GDP growth (the equity markey is a forward predictor and it feeds very largely into GDP growth rate) and heavy fiscal deficit which are financed via money market that had been acting as a vortex sucking life out of the equity market. Like i told Oga Oracle some moons back funds had not ceased to enter the country since d equity downturn started in early 2018 what changed from then till now was that those funds were largely going to the money market space (check FSDH analysis of foreign fund flow for last 4- 6 quarters in Monday businessday for insight)

my take is that if time is factored in, the equity market is presently more enticing than the money market (read UBA / Zenith Access at circa over 10% div yield for 6 month which annualised comes to over 20% compared to best effective yield in money market space of 14-15%) hence the funds flow towards the equity market we are currently witnessing. however i would expect this to tank as the div yield effectively move down towards 14-15% annualised (i.e. at the point which prices gives div yiled of of -6.5 - 7 % yield e.g UBA at 7.5-8.5 with expected gross dividend of 65k and net of 58k time horizon for same wld be d next 4-5 months

These are my personal take and what currently guides my decision however as a flexible animal these guidance might change if the drivers change (i.e. GDP growth rate / foreign funds flow pattern / size & financing pattern of fiscal deficit).