Market activity picked on Tuesday and resulted in 54 percent more shares trading, with 148 percent higher value than on Monday, on the Trinidad and Tobago Stock Exchange, but trading ended with the market indices slipping at the close.
The number of securities traded remained at 19 similar to trading on Monday and ended with four rising, five slipping and 10 unchanged.
The Composite Index fell 7.93 points to 1,532.16, the All T&T Index shed 4.14 points to close at 2,151.82 and the Cross-Listed Index shed 1.68 points to settle at 121.81.
Overall, 796,016 shares traded for $9,919,652 versus 516,896 units at $4,004,944 on Monday. An average of 41,896 units traded at $522,087 compared to 27,205 shares at $210,787 on the previous day, with trading month to date averaging 44,341 units at $361,051 versus 44,500 units at $350,629. The average trade for December amounts to 21,703 units at $306,768.
Investor’s Choice bid-offer indicator shows three stocks ended with bids higher than their last selling prices and two stocks with lower offers.
At the close, Angostura Holdings remained at $19.99 with 270 shares changing hands, Clico Investment Fund increased 99 cents to close at $29.50 with an exchange of 29,992 stock units, First Citizens Group lost 50 cents in ending at $65.50 after trading 652 units. FirstCaribbean International Bank finished at $6.14 in an exchange of 1,971 stocks, GraceKennedy ended unchanged at $6.20 after 11,125 shares changed hands, Guardian Holdings rose 18 cents to $30.20 with 1,711 stocks passing through the market. JMMB Group declined 31 cents to end at $2.24 in trading 202,436 stock units, L.J Williams B share fell 4 cents to close at $1.80 while exchanging 823 units, Massy Holdings ended at $106, with 43,163 units crossing the exchange. National Enterprises remained at $3.25 with the swapping of 120,000 shares, National Flour Mills finished at $1.92 in exchanging 1,372 stock units, NCB Financial Group remained at $8.01 after trading 321,694 stocks. One Caribbean Media advanced 10 cents to end at $4.20 in an exchange of 50,000 units, Republic Financial Holdings ended at $143, with 3,081 shares crossing the market, Scotiabank shed $2.97 to close at $72.01 trading 563 stock units. Trinidad & Tobago NGL finished at $20 as investors exchanged 1,083 stocks, Trinidad Cement rallied 4 cents to $3.80, with 316 stock units clearing the market, Unilever Caribbean dropped 25 cents to $15.75 while exchanging 1,306 stocks and West Indian Tobacco ended unchanged at $27.99, with 4,458 shares changing hands.
Prices of securities trading are those for the last transaction of each stock unless otherwise stated.
Archives for January 2022
Trading climbs but T&T market falters
Winners beat losers 2 to 1 on JSE USD Market
Trading on Monday ended with the volume of shares changing hands declining 57 percent with 72 percent lower value than on Friday, but the Jamaica Stock Exchange US dollar market closed with twice the number of stocks rising than falling.
Similar to trading on Friday six securities changed hands, with four rising and two declining. The JSE US Denominated Equities Index lost 0.67 points to end at 200.39.
The PE Ratio, a measure used in computing appropriate stock values, averages 12.6. The PE ratio uses ICInsider.com earnings forecasts for companies with the financial year up to August 2022.
A total of 805,542 shares traded for US$92,182, down from 1,856,215 units at US$329,297 on Friday.
Trading averaged 134,257 units at US$15,364, compared to 309,369 shares at US$54,883 on Friday and month to date an average of 88,816 shares at US$8,341 versus 85,682 units at US$7,857 on the previous day. December ended with an average of 439,975 units for US$68,382.
Investor’s Choice bid-offer indicator shows no stock ending with a bid higher than the last selling price and one with a lower offer.
At the close, First Rock Capital USD share advanced 0.38 of a cent to end at 6.93 US cents after exchanging 56 shares, Margaritaville dropped 2.94 cents at 12.01 US cents and closed with 68 stock units changing hands, Proven Investments declined 1 cent in closing at 22 US cents after trading 417,536 stocks. Sygnus Credit Investments USD share popped 1.49 cents to 12.99 US cents, with 7,696 units clearing the market with, Sygnus Real Estate Finance USD share gained 1.8 cents to close at 13.8 US cents in exchanging 272 stock units and Transjamaican Highway rose 0.03 of a cent in ending at 0.89 of one US cents trading 379,914 shares.
Prices of securities trading are those for the last transaction of each stock unless otherwise stated.
Junior Market at record high
The Junior Market is trading at record high at the start of Monday trading at 3,700.02 points after surging 114.27 points and exceeding the record close of 3,662.94 points on August 14, 2019.
The JSE Main market All Jamaican Composite Index jumped 3,232.66 points to trade at 442,490.38 within 25 minutes of the opening.
In trading Access Financial Services is up by $1 to $26, Caribbean Insurance Brokers rose 24 cents $2.90, Dolphin Cove gained to $1 to $23, Fosrich was up 21 cents to $14.44, Fontana gained 33 cents to $8, Lasco Distributors rose 12 cents to $3.25, Lasco Financial is up 21 cents to $3.27 followed by Lasco Manufacturing is up 38 cents to $4.98. Main Event rose 50 cents to $4.50, Paramount Trading rose 21 cents to $1.62 and SSL Venture Capital rose 41 cents to $1.69 following news of a proposed acquisition of 79 percent of the company’s shares.
In the Main Market, Caribbean Producers rose 61 cents to a new high of $16.50 and NCB Financial put on $2.13 to $130.
The Junior Market rise conforms to ICIsider.com report that the market was poised to make a big break from the consolidation around the 3,300 points mark and head to over 4,000 points.
Profit melts in the third quarter at Kremi
The 2022 fiscal year started with a blast for the first quarter to May with profit at $54 million after tax, doubling the $27 million in 2020, but a lot of that melted away in the third quarter to November at Caribbean Cream, which trades as Kremi, with the company reporting a loss in that quarter of $25 million down from a profit of $11 million in 2020. The loss brought profit for the nine months to $36 million compared to $85 million in the similar 2020 period.
Caribbean Cream did not have a good second quarter with sales rising 5.4 percent and profit falling 85 percent from $47 million to just $7 million due to what the company stated was the introduction of no movement days during the quarter that curtailed sales.
Sales revenues rose 14 percent for the third quarter to $500 million from $441 million but climbed 15 percent for the year to date, to $1.54 billion from $1.33 billion in 2020. The poor performance in the third quarter management attributes to “equipment and infrastructure challenges which we have addressed as we begin the final quarter.” In spelling out the issues Management, stated “at the beginning of the quarter the company faced unforeseen challenges in production resulting in the plant’s efficiency and capacity being impacted negatively. Since then, changes have been made in procedures, equipment and personnel to rectify the problem.”
While the company has been making headways with increased revenues, profit performance has not been consistent for some time, with the exception of the years 2014 to 2017 that enjoyed an annual increase in profits. The turbulence in profits since 2017 and the major problems in the 2021 third quarter reveal a major weakness in management that needs addressing. Such inconsistencies destroy investors’ interest in the company as well as the stock price.
Gross profit fell 13 percent in the quarter to $125 million from $143 million but rose 7 percent for the year to date, to $486 million from $453 billion in 2020.
Gross profit margin in the first nine months of the year, declined in the November quarter to 32 percent from 34 percent in the 2020 and for the quarter it dropped sharply to just 24 percent compared to 32 percent for the 2020 and that was a major contributor to the loss in the period.
Administrative expenses rose 15.5 percent to $129 million in the quarter and increased 26 percent in the nine months period to $378 million. Sales and distribution expenses increased by 8 percent in the quarter and the nine months to $16 million from $15 million in 2020 and from $43 million to $47 million, respectively. Depreciation rose from $88 million in 2020 to $95 million and is likely to rise further with the completion of the power generating plant being installed and is expected to make a major impact on the cost of utilities in the new fiscal year. Finance cost more than doubled in the quarter to $8 million from $4 million in 2020 and jumped 52 percent from $13 million to $20 million for the nine months.
Gross cash flow brought in $130 million down from $185 million in 2020. There was a release of $30 million from working capital but additions to fixed assets consumed $263 million funded by net loan inflows of $328 million. Payment of dividends consumed $26 million, more than twice the $11 million in 2020.
At the end of the period, shareholders’ equity stood at $844 million. Long term loans amounted to $654 million and short term at $11 million. Current assets ended the period at $553 million, including trade and other receivables of $82 million, inventories of $244 million and cash and bank balances of $227 million. Current liabilities ended at $140 million and net current assets at $413 million.
Earnings per share for the quarter was negative 7 cents and a profit of 10 cents for the year to date. IC Insider.com forecasts 27 cents per share for the fiscal year and $1 for 2023.
The stock traded at $5.40 on the Junior Market of the Jamaica Stock Exchange with a PE ratio of 20 times 2022 earnings and a PE of 5.4 times fiscal 2023 earnings. Net asset value is $2.33 with the stock selling at 2.4 times book value.
Profit surged 533% in Q2 at Paramount
Profit surged 533 percent in the 2021 November quarter, at Paramount Trading, to $29 million from just $4.5 million in 2020 after tax, but profit for the six months to November, popped by a much slower 141 percent to $48 million from $20 million in 2020. Notwithstanding the growth in the second quarter, the company is far from the profit made in the 2016 fiscal year of $173 million, with an average quarterly profit of $43 million.
Sales revenue jumped 30.8 percent for the quarter, to $401 million from $307 billion and climbed 15 percent for the half year, to $770 million from $669 million in 2020.
With profits hitting $101 million in 2017, the company has suffered since, with profit dropping to $53 million in 2020, rising in 2021 to $64 million. The current year seems on track to better the 2017 performance based on results to date.
Gross profit rose 30 percent in the November quarter to $130 million from $100 million in 2020, but just 11 percent for the half year, with $241 million realized versus $216 million in 2020. Gross profit margin slipped in the first half of the year, to 31 percent from 32 percent in 2020 and declined in the November quarter to 32 percent from 33 percent in 2020.
Administrative expenses rose 5 percent to $91 million in the quarter and increased just 3 percent in the six months to $181 million. Marketing and sales expenses fell 19 percent to $3 million in the quarter but rose 8 percent for the half year to $5.6 million while Finance cost rose 6 percent in the quarter to $13.4 million from $12.7 million in 2020 but fell 6 percent in the half year from $25.8 million to $24.3 million.
According to the company’s Chairman, Radcliff Knibbs in his report to shareholders on the half year results, “Paramount’s improved performance was achieved by employment of a robust growth strategy.” He went on to state, “we will continue to pivot our operations to take advantage of any possible opportunities that may arise.” He concluded that “we expect that our strategic objectives will be realized through strong income growth and cost containment.
Gross cash flow brought in $75 million but after addition to fixed assets and repayment of loan, the net cash position ended at $41 million, pushing cash resource to $302 million at the end of November. Shareholders’ equity stood at $844 million with long term loans at $454 million and short term at $47 million. Current assets ended the period at $948 million inclusive of inventories of $468 million, receivables of $346 million, cash and bank balances of $124 million. Current liabilities ended the period at $437 million. Net current assets ended the period at $511 million
Earnings per share came out at 2 cents for the quarter and 3 cents for the year to date. IC Insider.com is forecasting 12 cents per share for the fiscal year ending May 2022 and 20 cents for 2023. The stock that is now added to IC Insider.com TOP15 list at 11th position, traded at $1.37 on Friday, up 44 percent from a low of 95 cents in 2021 on the Junior Market of the Jamaica Stock Exchange with a PE ratio of 11 times 2022 earnings and 7 times 2023 projected earnings. Net asset value is 55 cents with the stock selling at 2.5 times book value. The stock price has clearly broken the long term declining trend but faces some short term resistance now around $1.40, but the recent results could well allow it to break free of that level.
The company paid a dividend of 4 cents in January 2021 and again in January 2022 amounting to $62 million.
New ICTOP10 listings & more big gains
Long time Junior Market ICTOP10 listed Access Financial, finally broke away from resistance and jumped 31 percent for the week to $26.28, but traded at a 52 weeks’ high of $28 on Wednesday and just barely hung on to the top ten in the tenth spot.
In the Main Market, Radio Jamaica rose 19 percent to $4.10, the 2021 ICTOP10 top performer, Caribbean Producers, climbed 5 percent and finally slipped out of the top 10 after a ride lasting more than a year and a gain of 573 percent, but the stock has more room for healthy gains.
Sagicor Group returns to the TOP10 Main Market and Stationery & Office Supplies returns to the Junior Market listing after an earnings upgrade, following a review of the forecasted numbers as the company continues to recover to pre-Covid-19 sales and Fontana dropped out with a 4 percent rise, but has much more room to grow in 2022.
Junior Market Elite Diagnostic gained 10 percent to $3.50, Honey Bun rose 7 percent. AMG Packaging lost 10 percent to end at $3.05, Lasco Financial lost 8 percent, Caribbean Assurance Brokers fell 7 percent and General Accident slipped 5 percent.
The week ended with the supplies for some stocks becoming very limited, this applies to Access and Radio Jamaica. Newly listed Spur Tree Spices came in for profit taking on Thursday and Friday after the price peaked at $2.75 and closed the week at $2.15 a fall of 22 percent from the peak, which suggests suggesting more room for decline before the price bottoms. That could take it to around $1.95 based on declines from peak to through of some previous IPOs.
The sharp price movements in the Junior Market reduced the potential gains markedly, with the average increase projected for the TOP 10 Junior Market stocks now at 119 percent versus 122 percent last week.
The top three stocks are Lasco Distributors followed by Caribbean Assurance Brokers and Lasco Financial to gain between 131 and 150 percent, compared to 124 and 160 percent, previously.
The potential gains for Main Market stocks moved from 144 percent to this weeks’ 139 percent this week, with the top three stocks being Guardian Holdings followed by JMMB Group and Sygnus Credit Investments all projected to gain between 151 and 254 percent down from 161 and 257 percent last week.
After trading at a big discount to the Main Market for two years, the average PE for both the JSE primary markets have virtually merged around 16 times earnings multiple based on 2021 earnings, with the Junior Market looking poised to surpass the main Market soon. The difference in potential gains for both TOP10 listings shows the Junior Market with an average rise of 118 percent versus 139 percent for the Main Market. That is an indication that the Junior Market is priced slightly higher than the Main Market.
The Junior Market closed the week, with an average PE of 16 based on ICInsider.com’s 2021-22 earnings and is currently below the target of 20 and the average of 17 at the end of March last year based on 2020 earnings. The TOP 10 stocks trade at a PE of a mere 9.2, with a 43 percent discount to that market’s average.
The Junior Market can gain 25 percent to March this year, based on an average PE of 20 and 6 percent based on an average PE of 17. Twelve stocks representing 29 percent of all Junior Market stocks with positive earnings are trading at or above this level averaging 25.
The average PE for the JSE Main Market is 16.5 just 15 percent less than the PE of 19 at the end of March and 21 percent below the target of 20 to March 2022. The Main Market TOP 10 average PE is 8.7 representing a 47 percent discount to the market and well below the potential of 20. A total of 14 stocks or 30 percent of the market trade at or above a PE of 19, with most over 20, for an average roundabout 25, suggesting that the accepted multiple is between 20 and 25 times the current year’s earnings.
ICTOP10 focuses on likely yearly winners, accordingly, the list may or may not include the best companies in the market. ICInsider.com ranks stocks based on projected earnings to highlight winners from the rest, allowing investors to focus on potential winning stocks and helping to remove emotional attachments to stocks that often result in costly mistakes.
IC TOP10 stocks are likely to deliver the best returns up to March 2022 and ranked in order of potential gains, based on the possible increase for each company, considering the earnings and PE ratios for the current fiscal year. Expected values will change as stock prices fluctuate and result in weekly movements in and out of the lists. Revisions to earnings per share are ongoing, based on receipt of new information.
Persons who compiled this report may have an interest in securities commented on in this report.
Big Jump in trading for JSE USD market
Trading on Friday, ended with the volume of shares changing hands rising after trading tenfold and the value climbing fifty times trading on Thursday, at the close of the Jamaica Stock Exchange US dollar market and resulting in a mild slippage in the market index.
Trading ended with six securities changing hands, compared to seven on Thursday with prices of two rising, two declining and two ending unchanged. The JSE US Denominated Equities Index lost 1.52 points to end at 201.06.
The PE Ratio, a measure used in computing appropriate stock values averages 12.8. The PE ratio uses ICInsider.com earnings forecasts for companies with the financial year up to August 2022.
Overall, 1,856,215 shares traded, for US$329,297 compared to 165,073 units at US$6,369 on Thursday.
Trading averaged 309,369 units at US$54,883up from 23,582 shares at US$910 on Thursday and for the month to date an average of 85,682 shares at US$7,857 versus 69,113 units at US$4,373 on Thursday. December ended with an average of 439,975 units for US$68,382.
Investor’s Choice bid-offer indicator shows one stock ended with the bid higher than the last selling price and none with a lower offer.
At the close, First Rock Capital USD share fell 0.38 od one cent to end at 6.55 US cents in trading 401,918 shares, Proven Investments shed 0.9 of a cents after ending at 23 US cents, with 1,295,052 units crossing the exchange, Sygnus Credit Investments USD share declined half a cent to close at 11.5 US cents, with 17,436 stocks changing hands. Sygnus Real Estate Finance USD share ended unchanged at 12 US cents in exchanging 965 stock units and Transjamaican Highway rallied 0.03 of a cent in closing at 0.86 US cents in exchanging 136,086 units.
In the preference segment, JMMB Group 6% advanced 4 cents to US$1.05 with an exchange of 4,758 stock units.
Prices of securities trading are those for the last transaction of each stock unless otherwise stated.