Investors looking for high returns on investment should consider a diversified portfolio of leading companies in the banking, healthcare, consumer goods, financial services and industrial goods sectors.
Analysts at GTI Securities said seven companies including United Bank for Africa (UBA), Access Bank, United Capital, Fidson Healthcare, Flour Mills of Nigeria, Dangote Cement, Lafarge Africa and Zenith Bank should be on investors’ watch list.
GTI Securities, which stocks to watch had successfully achieved 95 per cent of indicated targets, premised its analysis on corporate earnings and market information.
UBA had recorded a well-rounded performance in the third quarter of 2017 as growing market share and improving efficiency led to significant improvements in gross earnings and profitability.
Key extracts of the interim report and accounts of UBA for the nine-month period ended September 30, 2017 showed that gross earnings rose by 26 per cent while pre and post tax profits grew by 33.2 per cent and 23 per cent respectively.
UBA’s gross earnings rose to N333.9 billion in third quarter 2017 as against N265.5 billion reported in corresponding period of 2016. Group’s operating income stood at N236.9 billion in 2017 compared with N183.3 billion recorded in the corresponding period of 2016, representing a 29.3 percent growth. Profit before tax jumped to N78.3 billion in 2017 as against N58.8 billion recorded in the similar period of 2016. Profit after tax grew from N49.5 billion in 2016 to N60.9 billion in 2017.
The balance sheet showed that while the group closed the third quarter with total assets of N3.77 trillion, a year-to-date growth of 7.6 per cent, the bank prudently grew net loans to N1.6 trillion, a 6.0 per cent year-to-date growth in the loan book. Group’s shareholders’ fund grew by 13.3 per cent to N507.6 billion in 2017 while the annualised return on average equity stood at 18 per cent.
Access Bank in December 2017 launched a new five-year plan that aims at making the bank Nigeria’s foremost bank in the next five years.
The new plan is the latest in a series of transformative strategies that have resulted in sustained growth. From 2013 to November 2017, Access Bank has increased its total assets at a CAGR of 18 per cent and delivered shareholder returns of 90 per cent. The bank has also grown its customer base from 90,000 in 2002 to over 8.0 million in 2017 and in the same period opened 351 new branches.
The new five-year strategy is expected to accelerate this growth story to position Access Bank as the leading Nigerian bank by 2022.
The new strategy has six strategic levers including digitally led, retail banking growth and consolidation in wholesale markets, customer focused, analytics-driven, with robust risk management, strong global collaboration in key gateway markets and the creation of a universal payments gateway.