The Nigerian stock market resumes this week with high hopes following an impressive run last week, and there are three stocks to watch during trading activities; UBA, First Bank and Tantalizer.
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United Bank for Africa (UBA) has been in the news recently due to its chairman, Tony Elumelu, who has been acquiring shares of the financial institution in recent times through his investment firm, HH Capital Limited.
Elumelu has purchased 76.76 million UBA shares at the cost of N633.14 million, to take his ownership stake up from 6.96% reported at the end of 2021, to 7.18% as of May 25, 2023.
Speculations are piling up that Elumelu is acquiring the shares to tighten his control over UBA or just showing his believe in the growth prospects of the lender, whichever it is, his equity transactions have made UBA one of the stock to watch, as the second half of the year kicks off.
First Bank failed to release its financials at the stipulated deadline of the capital market authority, Nigerian Exchange Limited (NGX) and the Securities and Exchange Commission (SEC).
While this will earn the company a fine, the eventual release of the financials showed that First Bank suffered N14.90 billion drop in its profit after tax, which is where companies pay shareholders dividends.
First Bank failed to surpass or replicate the N151.07 billion net profit reported in 2021, as the company could only manage N136.17 billion in 2022. This is a -9.8% year-on-year drop in profit after tax.
Aside from the decline in Net profit, First Bank also piled up N25.9 million regulatory fines from the Central Bank of Nigeria (CBN) to the NGX Regulation Limited and the SEC.
It’s left to see how investors will react to this losses in the short term, as the financial statement was released in the last trading day of last week.
Last week trading activities ended with Tantalizer’s shareholders losing 16 per cent of their investments, as the capital market snubbed the fast-food chain for other investable equities.
Tantalizer experienced investor apathy, resulting in the firm’s share price plummeting to N0.21 kobo at the end of trading on Friday, from its opening price of the week, which was N0.25 kobo.
Although the decline in Tantalizer’s share price opens the door for equity investors looking to buy the dip, it could also spur selloffs among the bears, resulting in more losses, so investors are to trade with caution around Tantalizer’s stock.
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