As the Nigerian stock market embarks on another week of trading activities, three prominent companies have garnered attention as stocks to watch. Sterling Financial Holdings Company, Flour Mills of Nigeria (FMN), and BUA Cement have all made it onto the watchlist for the coming week.
Stocks Watchlist Overview
Ripples Nigeria stocks watchlist is a compilation of selected stocks that are closely monitored for potential trading or investment opportunities. It’s important to note that this list is not a buy, sell, or hold recommendation, and investors are strongly advised to consult with their financial advisors before making any investment decisions.
Sterling Financial Holdings Company
Sterling Financial Holdings Company has earned its place on the watchlist due to a series of acquisitions by four prominent directors within the financial institution and its banking subsidiary. Raheem Owodeyi, Abubakar Suleiman, Tunde Adeola, and Yemi Odubiyi collectively invested N515.26 million to acquire 155.83 million shares of Sterling Financial Holdings Company.
Such share acquisitions by key figures often reflect their confidence in the firm’s growth potential and can influence market sentiment. However, investors should exercise caution and not blindly follow every move made by major shareholders or directors, as stock price movements can be unpredictable.
Flour Mills of Nigeria (FMN)
Flour Mills of Nigeria faced a challenging period, reporting a loss of N9.33 billion in the first half of 2023. This loss was attributed to the devaluation of the Nigerian naira during the same period. This devaluation has hindered FMN’s ability to generate profits and distribute dividends to shareholders.
Furthermore, the company’s operating profit declined from N15.28 billion in the previous year to N7.11 billion for the period ending June 2023. A substantial foreign exchange loss of N22.5 billion contributed to this decline, impacting FMN’s retained earnings.
Investors should closely observe how shareholders react to these financial challenges in the upcoming months as the third quarter progresses.
BUA Cement
Abdul-Samad Rabiu, Chairman of BUA Group, announced plans to reduce the price of BUA Cement’s products before the end of the year. While this price reduction could affect the company’s revenue and bottom line, it may also lead to increased sales volume, especially if BUA Cement’s products become more competitively priced compared to rivals like Dangote Cement.
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Additionally, BUA Cement intends to expand its production capacity by at least 40 percent to reach 70 million tons by year-end. This expansion may offset some of the potential revenue loss due to price reductions.
The decision to lower prices and increase production capacity leaves BUA Cement’s growth outlook uncertain. As the market awaits these developments, cautious trading is advisable.
In summary, investors should keep a close eye on these companies in the coming week, considering the various factors that could impact their performance and market sentiment.
