Buy Rated update

Dolphin Cove was added to the Buy Rated list in May having produced a healthy 26 percent jump in earnings for the March quarter with indications that earnings could hit $1.20 for this year. At just $8.50, the price could jump in the months ahead.
Trinidad’s National Flour was also added to the watch list in May and AMG Packaging was moved earlier from Buy Rated to the Watch list. Access Financial which had been put back into the Buy Rated list when the price fell back to $8, has risen in price but remains on the Watch list until the director’s dispute is resolved.
Caribbean Cement remains in the buy list with the price having pulled back sharply, resulting from the unimpressive March quarter results. The price could still pull back some more so investors may want to watch before buying. One Caribbean Media has gained in price since placed on the Buy Rated list but is now losing some of its attractiveness with 25 percent potential gains to be expected from it now. Ivestors should be careful with this one unless their objective is for a longer term investment.
Junior Market| Some of the Junior market listings have not had a great first quarter in reporting profits, but prices have pulled back and that have helped to make them attractive buys with the hope that profit will improve going forward. The reality is that in the March quarter, government operated at a surplus and this would have pulled funds out of the system and squeezed consumers’ purchasing power, thus affecting the smaller companies more than the larger ones. Blue Power has stock buying interest but new investors may want to wait until the company reports in a few weeks’ time.
JSE Main Market| A number of the main market companies in Jamaica, reported strong first quarter growth in profits that points to the possibility of growth in 2014 profits for them. Outstanding results were reported by, Hardware and Lumber with IC Insider 2014 forecasted earnings, put at $5.40 which means a strong increase can be expected in the stock price. Grace reported 21 percent increase in March quarter results but some of this comes from one off losses incurred in 2013 and none in 2014 rather than from totally ongoing improvement in its operations. Pan Jam also reported strong increases in profit from continuing improvement in operations as well as recovery form one off losses in 2013. National Commercial Bank continues to post good numbers but the market is not yet impressed, Cable & Wireless revenues were up a strong 14 percent in the March quarter and seems headed to making a profit sooner than later as cost is also being cut. Cable & Wireless could benefit from increased customers from the heightened exposure that will flow from their sponsorship of telecast of the World Cup football on CVMTV station.
Carreras profit from ongoing operations is back on track after suffering a sharp contraction in the 2013 June quarter. With the high dividend payout the stock should gain from increased investor’s attention some time down the road. Jamaica Money Market with ongoing earnings up 81 percent for the year to March should see earnings in excess of $2 per share for the 2015 year and is clearly severely undervalued at $7. Sagicor Group’s profit was up a bit in the April quarter but remains undervalued. Scotia Group profit was down a bit in the April quarter but remains severely undervalued and Scotia Investments saw growth in profits in the April quarter but not a big increase over the NDX debt exchange affected 2013 quarter. The stock remains severely undervalued, nevertheless.
In Trinidad there are several stocks that remain undervalued compared to the average of the market, this is reflected in the Buy Rated list. See TTSE PE ratio chart for stocks selling below the market a sector levels.
Investors should note that the Jamaican market is in a period when investors’ attention on the market is low ahead of the period just ahead of the next set of company results due towards the end of July. This year with World Cup football taking centre stage the market may have to await August before the real depth of the market will be seen.