TTSE PE: Some stocks lose potential

Friday, 11 October 2013 | New to Top 6 of our PE Ratio list of stocks on the Trinidad & Tobago Stock Exchange is Point Lisas Port Development as it shows very promising prospects based on the results to June, 2013, excluding the fair value gains or losses on investment property. It now ranks as 5th with a possible 111% potential gain.

Elsewhere, Angostura Holdings’ price has have moved up leaving not much potential gain at current earnings and is now at the bottom of the PE listing with possibly a 15 percent more potential gain. Buyers at this level will be taking on added risk in the hope that 2014 results will continue to show improvement, thus making it an investment worth acquiring based on the scarceness of the stock.

TTSEPE_RatioOct11Guardian Holdings potential gains has been reduced and it slipped to 4th in the ranking with a 181% potential gain. National Flour has appreciated to 3rd place and National Enterprises has moved up in price and down in attractiveness but it could still move up by nearly 30 percent.

As at Friday’s close of the market, the bids look interesting for a number of stocks and the coming week could be compelling for investors and the IC Insider’s PE ranking of potential gains.

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Image courtesy of Jeroen Van Oostrom/ FreeDigitalPhotos.net

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Buy Rated: Some gains, some losses

Since we last looked at the performance of our IC Insider Buy Rated Stocks two weeks ago on 23rd September 2013, there have been some gain and losses. It’s been a full three months since we boldly started to ‘name names’ and now is the right time to do a full recap to see how we’re doing — or not!

Of the eleven Buy Rated stocks on the Trinidad & Tobago Exchange, only two are down, namely Guardian Holdings, off 5 percent and Neal & Massy 4 percent. Trinidad Cement is up 115% and still has room to grow based on its PE Ratio. First Citizens scored a whopping 52% for the short one month timeframe it made the list. Grace Kennedy is up 9 percent, JMMB 10 percent, Sagicor Financial 7 percent and Scotia Investment 6 percent.

So far, Buy Rated selections listed on the Jamaican market are not as successful with no gains to speak about. Meanwhile, Lasco Financial is down 19 percent and Jamaica Broilers is off by 14 percent.

It’s still early days yet. The Buy Rated selections are meant to identify stocks that will do well over the next twelve months. Short term pull backs are not negatives and are in fact buying opportunities for the serious investor.

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Related post | No change to Buy & Watch list | TTSE: PE ratio changes for the top 5 | Buy rated stock tracking

The IC Insider’s Buy Rated seal of approval is given to a stock that we believe is a compelling buy with earnings that are strong relative to the price and strong prospects of generating high price gains within the next twelve months.

Our research is backed by published reports of the company’s performance and insights of future earnings that can be found at ICInsider.com. The final decision to buy, or not, is your personal choice.

To find published reports for a Buy Rated stock on IC Insider, please choose the category ‘Buy Rated’ under Company News or enter the company name, in full or part at ‘Search IC Insider’.

U tweet, but will u buy twtr?

People are at the heart of Twitter, the company’s SEC filing says. The company has achieved significant reach globally and continues to grow with more than 215 million monthly active users and more than 100 million daily active users tweeting 500 million times daily, spanning nearly every country worldwide. Anyway you cut it, Twitter is now a household name and a critical tool for millions of people all over the world. Presidents, heads of state and celebrities are users of this communication tool.

Growth in acceptance of Twitter has translated into strong and rapid revenue growth from 2011 to 2012 increasing by 198 percent to $316.9 million, while net loss declined by 38 percent to $79.4 million and adjusted EBITDA increased by 149 percent to $21 million. For the six months ended June this year, revenue increased by 107 percent to $253.6 million over the same period in 2012, net loss increased by 41 percent to $69.3 million and adjusted EBITDA increased by $20.7 million to $21.4 million.

Since inception, Twitter accumulated deficits of $418.6 million. Although revenue has grown rapidly, increasing from $28.3 million in 2010 to $316.9 million in 2012, Twitter says  that they expect that the revenue growth rate will slow in the future as a result of a variety of factors, including the gradual slowdown in the growth rate of user base. Future revenue growth will depend on, among other factors, ability to attract new users, increased user engagement and ad engagement, increased brand awareness, to compete effectively, maximize sales efforts, demonstrate a positive return on investment for advertisers, and successfully develop new products and services to expand internationally.

According to the company, “The net proceeds from the sale of our shares of our common stock by us in this offering may be used for general corporate purposes, including working capital, operating expenses and capital expenditures.” Twitter anticipates making capital expenditures in 2013 of approximately $225 million to $275 million and they may use a portion of the net proceeds to fund anticipated capital expenditures and to acquire other businesses, products, services or technologies and other working capital needs.

Sources suggest that the IPO is set to raise at least $1 billion for the company which should take place within a few weeks when the issue price would be set.

TTSE PE: Changes in ranking

Friday, 4th October 2013 | The PE Ratio chart continues to show good potential for a number of stocks to provide decent gains in the months ahead on the Trinidad & Tobago Exchange.

There are some stocks that appear to be fully priced with a limited likelihood of growth and there are those that are riskier than stocks with very low PEs relative to their peers.

TTSE_PE+Oct4Trinidad Cement still sits atop the heap with potential for 500 percent gains followed by Guardian Holdings, Berger Paints that has not been trading and National Flour that climbed to 87 cents at the end of the week.

National Enterprises is now up to $17.02 which reduces the potential gains to 35 percent and Angostura Holdings gains is now down to 26 percent.

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Sagicor cuts dividends

Both Sagicor Life and Sagicor Investments have cut dividends from the amounts paid in 2012.

Sagicor Life | The Board of Directors of Sagicor Life Jamaica Limited declared a dividend of 21 cents per share payable on October 31, 2013 to shareholders on record as at October 16, 2013. The ex-dividend date is October 14, 2013. This latest dividend brings the total for 2013 to 40 cents per share as a dividend of 19 cents per share was paid on March 28, 2013.

In 2012 the company paid two dividends of 28 cents each for a total of 52 cents per share.

The decline in dividend payout comes against the back drop of losses picked up from the government bond exchange (NDX) earlier this year, which resulted in realized capital losses of $1.2 billion and a 16 percent drop in net profit attributable to stockholders for the six months to June of $2.18 billion versus $2.60 billion in 2012.

Sagicor Investments | Sagicor Investments Jamaica declared an interim dividend in the amount of 12 cents per stock unit payable on October 31, 2013 to stockholders on record as at October 17, 2013 with an ex-dividend date of October 15, 2013. The company paid an interim dividend in the amount of 48 cents per stock unit on March 27, 2013.

In 2012 the company paid a dividend of 57 cents per stock unit on October 29, 2012 to stockholders and 74.3 cents per stock unit on April 27, 2012. The 2013 dividend is a 50% decrease from the prior year.

Sagicor Jamaica is an IC Insider Buy Rated Stock 

Related posts | Changes, changes, changes | Sagicor offers shares in Real Estate X Fund | Q2 profit up strongly at Sagicor

Insider Trades Aug to Sept 2013

Updated 2nd October, 2013

Scotia Group Jamaica advised that under the Employee Share Ownership Plan, a senior officer acquired 10,171 SGJ shares and two senior officers withdrew a total of 79,563 SGJ shares in September. The company also advised that a senior officer of Scotia Investments Jamaica Limited purchased 51,000 SGJ shares on September 26, 2013.

The Gleaner Company Limited advised that a senior manager sold 100,000 shares of the company on September 26, 2013.

Mayberry Investments Limited advised that a related party purchased 50,435 of the company’s shares during the period October 1 – 2, 2013.

Ansa McAL Limited informed the Trinidad Stock Exchange that on September 20, 2013 a major shareholder connected to a Senior Officers purchased 32,167 of the company’s shares.

Jamaica Money Market Brokers advised that a related party sold 1,359,300 JMMB shares on September 30, 2013.

Mayberry Investments advised that a related party purchased 4,732 of the company’s shares on September 30, 2013.

Mayberry Investments advised that a related party purchased 67,230 MIL shares during the period September 20 – 24, 2013.

Scotia Group Jamaica advised that a senior manager purchased 4,500 SGJ shares on September 19, 2013.

Jamaica Money Market Brokers Limited (JMMB) has advised that a related party sold 1,000,000 JMMB shares on September 20, 2013. A related party also sold 507,100 of the company’s shares on September 17, 2013 and another sold 122,639 shares on September 18, 2013. It also looks as if 8 million units of the company’s stock that was sold on Monday could be from insiders.

Mayberry Investments Limited advised that a related party purchased 13,000 of its shares on September 20, 2013

Blue Power Group Limited advised that a senior manager sold 40,000 shares on September 12, 2013

Scotia Group Jamaica Limited advises that a senior manager purchased 88,000 of the company’s shares under the Employee Share Ownership Plan on September 13, 2013 and that a senior manager sold 13,025 of the group’s shares under the Employee Share Ownership Plan on September 3, 2013.

Dolphin Cove advised that a Director bought 11,642 of the company’s share on August 27, 2013 and during the period August 27, 2013 to September 10, 2013, a director sold total of 31,500 of the company’s shares.

Mayberry Investments Limited advises that a related party purchased 17,152 shares on September 12-13, 2013 and a related party purchased 346,095 shares on September 10, 2013

Jamaica Money Market Brokers Limited advised that a related party sold 160,000 JMMB shares on September 9, 2013

Mayberry Investments advised that a connected party has bought a total of 42,550 of the company’s shares during the period September 4-5, 2013.

Jamaica Money Market Brokers advised that a connected party sold 1,000,000 of the company’s shares on September 5, 2013

Sagicor Investments Jamaica advised that a senior manager purchased 74,082 S shares under the S Stock Option Scheme on September 2, 2013

Jamaica Money Market Brokers (JMMB) advised that a senior manager purchased 2,597 JMMB shares on August 27, 2013 and that a connected party sold 300,000 JMMB shares on August 28, 2013.

Mayberry Investments advised that a connected parties has traded 90,739 MIL shares on August 29, 2013; purchased 106,728 MIL shares on August 28, 2013 and a bought a total of 3,040 during the period August 30, 2013 to September 2, 2013. They also advised that a related party purchased 33,386 MIL shares on September 3, 2013.

Jamaican Teas advised that a director sold 2,000,000 of the company’s shares on September 2nd and 3rd.

Mayberry Investments advised that a connected party purchased 106,728 of the company’s shares on August 28, 2013

Sagicor Investments advised that a senior manager sold 82,904 of the company’s shares on August 28, 2013

Jamaica Money Market Brokers advised that a senior manager purchased 2,597 of the company’s shares on August 27, 2013 and a related party sold 220,000 shares on August 20, 2013.

Jamaica Producers Group | Two related parties purchased a total of 653,240 shares on August 19, 2013. Also, a Director purchased a total of 500,000 of the company’s shares on August 14 and 15, 2013. Previously two Directors purchased a total of 290,287 of the shares between May 17 and 24, 2013. An interesting pattern is developing that worth watching.

Related Posts | JMMB big bump in profits | Profits up at Jamaica Producers | Q2 profit up strongly at Sagicor | Exports push Jamaican Teas’ profit

Republic ups stake in Ghanaian Bank

Trinidad’s Republic Bank has increased its holding in HFC Bank Ghana Limited from 32 percent to 40 percent with the purchase of an additional 7.98 percent from one of the bank’s shareholders — Union Bank of Nigeria PLC.

The transaction involved 23,638,340 ordinary shares at a price of GHS 0.67 (USD 0.31) per share. This is the second such increase in Republic’s holdings in the Ghanaian Bank. The matter of Republic making a mandatory offer to all shareholder to acquire majority shares is still unresolved and this latest acquisition will probably make it more difficult to resist the demand by the Securities regulators for Republic Bank to proceed with the offer.

Republic Bank is an IC Insider Buy rated stock.

Related post | Republic onto something good in Africa | No change to Buy & Watch list

Caribbean Flavours a new IPO

Update Monday, 30th September | Mayberry Investments advised that the company has reconciled all applications in respect of Caribbean Flavours & Fragrances Initial Public Officering (IPO). There was full allotment for all reserved applications which included board of directors, staff, Mayberry Investments and Key Partner. The first 10,000 shares applied for by the public were allocated in full and balance over 10,000 units were allocated with approximately 19.355 percent of what was applied for.

Update Thursday, 26th September | Lead broker Mayberry Investments Limited announced that the initial public offering (IPO) of shares in Caribbean Flavours & Fragrances Limited (CFF) is oversubscribed and was closed at 9:01 am on Wednesday. Applications were received in excess of the $50.6 million on offer. The public will be advised of the basis of allotment by Friday, 27th September 2013.

The junior market of the Jamaica Stock Exchange should be welcoming its 19th listing in the form of Caribbean Flavours & Fragrances Limited (CFFL) as the company goes to market to sell up to 22,480,008 ordinary shares at j$2.25 per share. After the issue, the total number of shares will be 89,920,033 making it one of the smaller listed companies.

The company is one of the largest businesses of its kind in the English speaking Caribbean. It is engaged in the manufacturing and distribution of flavourings and water soluble colourings for the food, beverage, baking, confectionery and pharmaceutical industries and is a key supplier of these products. It also manufactures and supplies fragrances used in household cleaning, body care, aroma therapy and air freshener products.

Incorporated on 23rd February 2001, its business and assets were purchased from prior owner Bush Boake Allen Jamaica Limited and is a supplier to predominantly commercial customers in Jamaica, Trinidad and Tobago, Grenada, Barbados, St. Kitts, Guyana, USA and Canada. Its customers are well known names in the food and beverage business.

CaribbeanFlavours&Fragrances+tubes115pxCFFL sources essential oils and natural extracts worldwide and receives key ingredients and technical support from International Flavors & Fragrances Incorporated (IFF), responsible for more than 70 percent of the company’s supplies. IFF is a US$5 billion company listed on the NYSE and is a member of the S&P 500 Index. Lascelles deMercado is a key local supplier, providing alcohol for use in fragrance distillates and other items. Some of the supplies used are commodities with variable prices linked to world markets. The company aims not to carry more than 6 months’ stock of supplies.

CFFL has one competitor in the local market, Virginia Dare (Jamaica) Limited. In the view of the Directors, their particular business focus is on the supply of custom blended products for large local businesses and this distinguishes it from their competitor that supplies retail and smaller business clients with generic products such as bulk syrups.

Income | Revenues amounted to $193.9 million in the 2012 financial year, an 8 percent increase over the $179.4 million recorded in the prior financial year. During 2012 financial year, the company generated increased gross profit of $79.4 million versus $60.9 million in 2011 fiscal year due to increased sales of its products and higher margins of 40.95 percent, compared with 33.95 percent in the 2011 financial year.

CaribFlovoursOperating Expenses totaled $72.94 million for the 2012 financial year, a year on year increase of 24.5 percent due mainly to increased promotional activity and compensation to directors. CFFL recorded improved Profit before Taxation in for the year, which grew to $6.46 million compared to the $2.36 million for the prior year.

Revenues for the 12 month period ended June 2013 was $229.89 million, increasing 19 percent over the $193.87 million recorded for the 2012. The growth in revenue was driven by increased sales of the products in the fragrance line of the business. Gross Profit totalled $92.73 million compared to $79.39 million. Total operating expenses amounted to $60.49 million for the year, 17 percent less than the $72.94 million recorded for the year prior. This decline was due to a reduction in directors’ fees. Other Income totalling $16.80 million is due mainly to sale of property. Finance Income was $2.53 million for the year. Profit before taxation totalled $51.57 million for the latest fiscal year and net profit amounted to $40.32 million.

Assets totalled $97.52 million as at June 2013, $22.90 million less than the $120.42 million at June 2012. The decline is due to the sale of property. During the period the company reduced the amount outstanding to directors resulting in liabilities totalling $31.45 million as at June, 2013 versus $94.7 million as at the end of 2012 financial year. Shareholders’ Equity stood at $66.06 million at the end of June 2013.

Earnings per share before taxation is 46 cents putting the PE around 5 times earnings to June this year, providing room for some appreciation in the short term. The negative is that the company and its management is not well known and the number of stock in issue is small creating and illiquid situation.

The Directors anticipate a payment of an annual dividend of not less than 25 percent of the annual net profits after payment of any applicable taxes where “such profits are available for distribution, subject to the Company’s need for reinvestment of some or all of its profits from time to time in order to finance the growth of the business of the Company.”

No change to Buy & Watch list

After a number of changes last week, IC Insider retains the same selection on the Buy Rated and Market Watch list.

Importantly, Grace Kennedy, which was added last week, announced that they will be pursuing a share buy back of 2.5 percent of the company’s shares over the period of up to a year. This takes effect 21 days after the notice was made to the stock exchanges of Jamaica and Trinidad on the 27 of September. The shares will be purchased on the open market of the exchanges and will be executed when the company believes the price is below its true value. The company has nearly 335 million shares in issue and so far this year has bought back slightly more that 1 million units. The 2.5 percent buy back would translate to just over 8 million shares. This compares with 24.6 million shares traded during the last twelve months of which 8.6 million traded on one day.

The stock last sold at $54 in Jamaica and had a bid of TT$3.36 in Trinidad or just under J$54. There is no stock on offer on the Trinidad market where demand has picked up following what the company’s CEO Don Wehby says was a successful visit.

Grace’s PE is around 5.5 times this year’s earnings with net asset value per share of just under $100 per share. At current interest rates the stock is a great buy, both for the company and the investing public, as the price could climb sharply into next year.

Related posts | Changes, changes, changes | Grace’s profit up 41% in June quarter

The IC Insider’s Buy Rated seal of approval is given to a stock that we believe is a compelling buy with earnings that are strong relative to the price and strong prospects of generating high price gains within the next twelve months.

Better than a broker’s ‘buy’ recommendation, IC Insider has no vested interest in any stock transaction or conflict of interest. Our research is backed by published reports of the company’s performance and insights of future earnings that can be found at ICInsider.com. The final decision to buy, or not, is your personal choice.

To find published reports for a Buy Rated stock on IC Insider, please use category ‘Buy Rated’ under Company News or enter the company name, in full or part at ‘Search IC Insider’.

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TTSE: PE ratio changes for the top 5

Friday, 27th Friday 2013 | There have been a few changes to the PE Ratio rankings this past week as prices moved a bit on the Trinidad Stock Exchange resulting in changed positions for the Top 5 Stocks with the highest potential gains.

National Flour dropped from the second spot for potential gain to fourth due to the price increasing to 89 cents at the end of the week. Guardian moved up to the second spot while Agostini’s dropped below National Enterprise to tenth position by a moderate increase in price. Meanwhile despite a loss of 4 cents, Trinidad Cement still holds on to the Number One spot with nearly a 500% potential gain.

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The Top 5 companies with the most potential are Trinidad Cement, Guardian Holdings, Berger TT, National Flour and Neal & Massy.

Newly listed First Citizens remains off the buy list with the stock being fully valued and is hemmed in by the values of other bank stocks like Scotia and Republic Bank.

 

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