Trading on the Junior Market climbed on Monday with an exchange of 21,868,083 units valued at $65,699,802 compared to 1,704,155 units valued at $7,059,645 on Friday but the market index fell more than 40 points.
At the close, the market Index dived 40.70 points to close at 3,021.51 as the prices of 6 securities rose, 4 declined and 6 traded unchanged resulting from 16 securities changing hands, down from 20 on Friday.
IC bid-offer Indicator|At the end of trading, the Investor’s Choice bid-offer indicator reading shows 7 stocks ending with bids higher than their last selling prices and 3 with lower offers.
Trading ended with an average of 1,366,755 units for an average of $4,106,238 in contrast to 85,208 units for an average of $352,982 on Friday. The average volume and value for the month to date amounts to 340,878 units valued at $1,271,893 and previously 187,472 units valued at $848,065. June closed with an average of 139,543 units, valued at $671,002 for each security traded.
At the close of trading in the Junior market, AMG Packaging ended 1 cent higher at $2, with 5,028 stock units, Caribbean Producers finished trading at $5.25, with 8,291 units, C2W Music added 15 cents to close at a 52 weeks’ high of $1.45, with 13,408 shares, Elite Diagnostic settled with a loss of 3 cents at $2.97, with 20,046,806 units, Everything Fresh traded 29,100 units and closed at $2.14, Express Catering gained 4 cents to close at $7.14, with 8,135 shares. FosRich Group finished trading 10 cents higher at $2.75, with 125,000 shares, Honey Bun concluded trading at $5, with 9,475 shares, Jamaican Teas ended trading 24,929 stock units and rose 1 cent to close at $5.01, Jetcon Corporation traded 17,500 units at $4. Key Insurance traded 1,500,000 shares with a loss of 99 cents at $3.01, Knutsford Express declined by $1.01 to $11.50, with 1,000 shares, Lasco Distributors rose 3 cents to $4.18, with 25,668 stock units, Lasco Financial finished at $5.10, with 17,996 units traded, Lasco Manufacturing settled at $4, with 1,107 shares and Stationery and Office closed with a loss of 5 cents at $7.95, with 34,640 units changing hands.
In the Junior Market US dollar bond market Eppley 5% bond traded 373 units at US$1.
Prices of securities trading for the day are those at which the last trade took place.
Unilever slide continues on TTSE – Monday
Unilever Caribbean continues its near yearlong decent as profit fall and pushing the stock price sharply down since September last year, ending trading with a loss of 75 cents on Monday after falling $1.73 on Friday to settle at a 52 weeks’ low of $26.75, after exchanging 50,921 shares.
The Trinidad & Tobago Stock Exchange closed Monday with trading in 13 securities against 17 on Friday, with 1 advancing, 5 declining and 7 remaining unchanged.
At close of the market the Composite Index lost 4.17 points on to 1,227.98. The All T&T Index shed 0.65 points to 1,721.45, while the Cross Listed Index eased 1.07 points to close at 98.67.
Trading ended with 95,555 shares at a value of $1,642,849, compared to 237,585 shares on Friday valued at $1,584,143 changing hands on the previous trading day.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading shows market sentiment with 2 stocks ending with higher bids than the last selling prices and 3 with lower offers.
Gains| Calypso Macro Index Fund rose 30 cents to close at $17.49 while 200 shares changed hands.
Losses| JMMB Group closed with a loss of 1 cent and concluded at $1.75, after exchanging 28,000 shares, NCB Financial Group closed with a loss of 15 cents and settled at $5.35, after exchanging 1,000 shares, Sagicor Financial shed 13 cents and ended at $7.81, with 1,565 stock units changing hands, Trinidad & Tobago NGL lost 3 cents and ended at $29.70, with 783 stock units changing hands.
Firm Trades| Ansa Mcal completed trading at $58.00, with 185 units, Clico Investments ended at $20.52, with 2,700 stock units changing hands, First Citizens settled at $35.00, after exchanging 1,649 shares, Grace Kennedy ended at $2.92, with 8,053 stock units changing hands, Republic Financial Holdings concluded at $102.76, after exchanging 150 shares, changed hands, Scotiabank completed trading at $65.01, with 296 units and West Indian Tobacco concluded at $87.00, after exchanging 53 shares.
Prices of securities trading for the day are those at which the last trade took place.
Mismatched stock values
At the start of June, investors could pick up PanJam Investment shares at $45 and theoretically sell off the 31.56 percent holdings in Sagicor and own each PanJam share for just $1.
A few weeks on, the proposition is more expensive to achieve as it would cost $8 to achieve the same objective. Based on the lack supply of PanJam shares on the market it could become even more expensive in the weeks and months ahead.
While that anomaly exits, there is the wield situation in the local stock market where prices seem to be mismatched. Jamaica Producers (Producers) is selling a PE around of 25, well above the market average of 13 currently, but below Kingston Wharves (KWH) at 30. Jamaica Producers owns 50 percent of KWH with half of its market value being $33 billion. Producers is valued by the market at $19 billion well below its half of KWH. It would require a 74 percent price gain in Producers to equal the value of their holdings in KWH, assuming the latter remains around the current price of $46.55.
Another fascinating finding is that Junior Market listed Access Financial Services with market capitalization of $12.77 billion is almost twice the size of Mayberry Investments of just $7.8 billion. Mayberry formerly owned over 40 percent of Access before selling it off to Proven Investments.
Mismatching is also evident in the junior market with Cargo Handlers and Knutsford Express selling well above the market for more than a year, even after their prices have slowly declined over that period. Everything Fresh has now joined the group of highly valued stocks with PE in excess of 20 times 2018 earnings. With Treasury bill rates just under 2.5 percent and heading lower PE of 20 should now be common place, but when the market is selling well below then it raises some questions about how well investors are pricing stocks. A keen look at these high priced stocks with exception of KWH, shows that the prices have not gained in over a year with some have fallen, but others in the market have recorded strong gains. Some of these stocks seem poised to under perform the market for awhile, until time and increased earnings better align their values with the rest of the market.
Mayberry Jamaican Equities hits market
Mayberry Investments (MIL) offer of 120,114,929 ordinary shares at $7.56 in the capital of Mayberry Jamaican Equities opens today at 9 and is scheduled to close on July 30.
The offer is slated to raise $908 million after cost of relating to the issue. The shares are expected to be listed on the main market of the Jamaica Stock Exchange, if the issue is successfully taken up and will result in 80 percent of the shares owned by MIL. MIL states in the prospectus that they will reduce their holding if they receive institutional buying interest in them.
There is an inter-company margin loan of J$545,386,403 due to MIL but after the offer, the loan is expected to be fully repaid. The offer is fully underwritten by companies owned by Mark and Christopher Berry.
Mayberry Jamaican Equities is a closed end mutual fund that will be paying a cash dividend. The Board intends to adopt a liberal dividend policy. Assuming there are sufficient distributable reserves then for each financial year the Company intends to target a dividend payout of up to 75 percent of net profits after tax.
The Company does not have any employees of its own and that is consistent with its business model. It has an investment management agreement with Mayberry Asset Management (“MAM”). MAM in turn relies on the investment expertise of its principals, Christopher Berry, Konrad Mark Berry and Gary Peart, to provide the requisite investment management services to the Company. A performance fee of 8% of any increase in the Company’s Total Comprehensive Income must be paid to MAM.
The Company will buy and sell securities from, and to, brokers and dealers in the Jamaican market and the US securities market. It may also invest in bonds or notes issued by borrowing companies.
At the end of 2017, shareholders equity stood at US$71 million up from US$51.6 million in 2016 as the underlying investment grew in value. Revenues from interest dividends and trading gains amounted to $3.7 million from $1.7 million in 2016 and profit of US$3.1 million compared to $1.26 million. The company reported profit of $1.25 million for the March 2018 quarter from total revenues of $1.87 million and shareholders’ equity rose to US$76.2 million.
There are positives and negatives to take from the offer. Unlike unit trust, the issue may not provide the same level of liquidity, but the use of leverage from time to time can boost returns for the portfolio, if executed properly. The flip side it can negatively affect returns if the portfolio value stagnates of falls.
The vehicle is new to the stock exchange and it is not known how investors will price the stock once listed.
IPO facts investors should know
“Hello my dear client, the day we have been waiting for to increase your wealth is here. The Mayberry Jamaican Equities IPO has finally arrived, the stock is a must have at this time. Attached are the Prospectus and Application Form for your attention. The official opening date is Monday, July 9, 2018, the demand is high so please don’t delay,” Kind regards, a MIL wealth adviser.
The above was a message sent out by one of Mayberry’s wealth advisor. A group of investors stated in 2017 that investors cannot go wrong with Junior Market IPOs, all that has to be done is just buy, buy, buy and the investor cannot fail to make money. Some investors in the last two IPOs, Sygnus Credit and Everything Fresh bought into the issues heavily, hoping to catch an early bounce and pocket the profit. That the initial bounce did not last, should be a lesson to speculators.
Laden with 6 main and Junior Market stocks, Mayberry Jamaican Equities is issuing 120,114,929 ordinary shares to the public, at a price of $7.57 each. Investors really ought to know what they are buying into when IPOs are being issued, rather than thinking that the price of each IPO can only go in one direction – up. As the stock market matures and more persons come to the party of stock ownership, the valuations that new IPOs come to the market at, will continue to rise and less immediate potential gains will be priced in. In some cases, investors will need to look long term for the payoff from their investment.
Everything Fresh, Sygnus Credit, Stanley Motta and Mayberry Jamaican Equities fall into this category. GWest was another company that many investors got carried away with, in pushing the price to $4 with many buying at inflated values, now the stock trades in the low $2 range. A reminder of an adage, that successful trading starts at buying at the right price. GWest business model is based mainly on generating most income and profits coming from operating mini hospital and other patient care. Real estate income going forward was going to be secondary and would not contribute much to profit. Profit made in the year before listing was mostly from sale of real estate and that was not something that would continue for any prolonged period. Without a track record in providing healthcare, investors who bought the stock in the high $3-4 level must have been hoping that the forecast in the prospectus was going to be achieved on a timely basis. The results to March show revenues well below forecast from the new operations. The company projected medical income to March this year, at $86 million but only generated $17.4 million and that puts the issue of generating the forecasted $710 million for fiscal year 2019, in doubt. Admittedly, the company had projected a loss to March of $110 million but came up sharply lower with a loss of $88 million.
Investors should recognize that not all IPOs are equal. They should also realize that there is a clear pattern that prices then to move up for strongly demanded issues and the undergo some correction. The data shows that the best time to buy after the IPO closes is on the first day or two or a few weeks after when demand falls off and supply increases as short term investors try to offload.
Data for listings in 2016 to 2018 show and average of 31 percent correction for Junior Market stocks from the highest point to the lowest, after listings which tends to occur within 4 weeks of listing. IPOS from Mayberry seem to have a lower pull back in price, around an average of 23 percent while most others, average around 33 percent. Three main market stocks pull back from their highest point, range from just 15 percent for Victoria Mutual Investments to 31 percent for Wisynco and 29 percent for Sygnus Credit Investments.
Based on how investors have gone about pricing IPOs at their peak it seems likely that Indies Pharma will peak around $2.40 based on projected earnings in 2018, of 16 cents per share. It could even go higher if the number of investors who apply for shares exceed those Junior Market listings IPOS from those going back to 2018.
9 stocks fall 2 rise on TTSE – Friday
The Trinidad & Tobago Stock Exchange closed Friday with trading in 17 securities against 17 on Thursday, with 2 advancing, 9 declining and 6 remaining unchanged.
At close of the market the Composite Index rose 0.16 points on Thursday to 1,232.15 The All T&T Index shed 1.84 points to 1,722.10, while the Cross Listed Index added 0.30 points to close at 99.74.
Trading ended with 237,585 shares at a value of $1,584,143, compared to 180,386 shares at a value of $2,780,395 changing hands on the previous trading day.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading shows market sentiment with 2 stocks ending with higher bids than the last selling prices and 3 with lower offers.
Gains| Clico Investments gained 2 cents and concluded trading at $20.52, with 9,100 stock units changing hands and NCB Financial Group finished 13 cents higher and completed trading at $5.50, after 113,800 shares changed hands.
Losses| Calypso Macro Index Fund dropped 99 cents to close at $16.50 while 1,325 shares changed hands, First Caribbean International Bank closed with a loss of 10 cents and ended at $8.40, with 10,000 units, Grace Kennedy shed 1 cent and ended at $2.92, with 86,606 stock units changing hands, Massy Holdings lost 1 cent and settled at $47.19, after exchanging 41 shares, National Enterprises ended trading 2 cents lower at $9.53, with 2,690 stock units changing hands, One Caribbean Media concluded trading with a loss of 34 cents and settled at a 52 weeks’ low of $12, after exchanging 4,141 shares, Trinidad & Tobago NGL traded with a loss of 1 cent at $29.73, with 636 stock units changing hands, Trinidad Cement fell 5 cents and ended at $2.95, trading 2,000 units and Unilever Caribbean closed with a loss of $1.73 and completed trading at $27.50, after exchanging 555 shares.
Firm Trades| Angostura Holdings concluded market activity at $15.75, with 1,618 stock units changing hands, Ansa Merchant Bank completed trading at $40, after exchanging 333 shares, First Citizens exchanging 1,096 shares at $35, Republic Financial Holdings settled at $102.76, after exchanging 1,922 shares, Sagicor Financial concluded trading at $7.94, with 1,621 stock units changing hands a West Indian Tobacco settled at $87, after 101 shares changed hands.
Prices of securities trading for the day are those at which the last trade took place.
Bolshoi Ballet, Coppélia this Sunday
A sparkling tale of magic and mischief, Coppélia has everything a good story ballet should: a touch of enchantment, a dash of romance and masses of sumptuous costumes.
Dubbed one of the most enduringly popular ballets of all time, Coppélia tells the story of young love, duplicity and rivalry. In this timeless romantic production, Swanilda and Franz are in love until the appearance of Dr Coppelius and his mysterious daughter Coppélia upset the celebrations. However, Dr Coppelius’ haughty daughter is not what she purports and Swanilda must rescue Franz from the magician’s sinister doll-filled lair – with the help of some fancy footwork.
Coppélia premiered in 1870 at the Paris Opera (The National Academy of Music and Dance). It was originally choreographed by Arthur Saint-Leon, a virtuoso dancer, expert on dance folklore, composer and violinist. This interpretation is by the late Russian Choreographer; Sergei Vikharev, with the main dancing roles by Bolshoi Principals; Maria Alexsandrova, Natalia Osipova, Anastasia Goryacheva (Swanilda) and Ruslan Skvortsov, Vyacheslav Lopatin and Artem Ovcharenko (Franz). The music is composed by Leo Delibes and the decor was revived by Boris Kaminsky, with costumes Tatiana Noginova. Conductor is Igor Dronov.
The Bolshoi’s version of Coppélia maintains the original 19th century choreography of this ebullient comedy involving a feisty heroine, a fickle fiancée, and an eccentric inventor.
On screen Sunday July 8 at 11: 30 a.m., at Palace Cineplex this chilling, yet luminous ballet continues to captivate audiences for over 150 years at the Bolshoi.