Elite Diagnostic returns to the Junior Market ICTOP10 listing at the number 2 spot, Dolphin Cove dropped out but there are no changes to the Main Market Listing.
Elite Diagnostics had a bad fiscal year to June, with a loss of $1.7 million in the June quarter and a profit of only $2.8 million for the year, down from $49 million in 2022. With finance cost jumping to $47 million from $27 million the previous year while depreciation climbed by $41 million to $148 million. ICInsider.com expect revenues to keep on climbing at a above average rate and for cost to increase at a slower pace and deliver an attractive profit which is projected at 40 cents for the year. Recent history suggests that forecasts can be derailed by unforeseen developments, but the stock is worth while looking at as a medium term investment that is undervalued relative to potential.
Developments in the past week, the Main Market, now reflects the Jamaica market price for Margaritaville that climbed 16 percent to $16.30, followed by an eight percent increase for JMMB Group to$29.70 following an announcement from the company that the will be implementing a $10 million stock buyback, while 138 Student Living popped 5 percent to $4.33 and Key Insurance shed 13 percent to close the week at $2.50.
The Junior Market ICTOP10 closed the week with General Accident rising 10 percent to $4.94, followed by Caribbean Assurance Brokers, up 6 percent to $2.83 as Iron Rock Insurance dropped 9 percent to $2.10 and Everything Fresh dipped 5 percent to $1.30.
At the end of the week, the average PE for the JSE Main Market TOP 10 is 5.1, well below the market average of 12.2. The Main Market TOP10 is projected to have an average of 330 percent, to May 2024, based on 2023 forecasted earnings.
A total of 12 of the most highly valued stocks representing 26 percent of the Main Market are priced with a PE of 15 to 84, with an average of 29 and 20 excluding the highest PE ratios, with a PE of 22 for the top half and 17 excluding the stocks with the highest PEs.
The Junior Market Top 10 PE sits at 5.1 compared with the market at 10.6. There are 10 stocks or 21 percent of the market, with PEs from 15 to 39, averaging 21 that are well above the market’s average. The top half of the market has an average PE of 15, possibly the lowest fair value for Junior Market stocks currently, and projected to rise by 298 percent to May 2024.
The divergence between the average PE ratio of the Main and Junior Markets and the overall market valuation are important indicators of the level of likely gains for ICTOP10 stocks.
The markets are not in a bullish state but there continue to be cases of slow upward movements in some prices as investors respond to some recent attractive results leading them to quietly nibble away at a number of stocks, gradually reducing the supply of a number of them that are attractively priced. The list includes stocks such as Access Financial, AMG Packaging, Everything Fresh, Dolphin Cove, Caribbean Cream, Caribbean Assurance Brokers, Lasco Distributors and Lasco Manufacturing, Main Event and Transjamaican Highway.
ICTOP10 focuses on likely yearly winners, accordingly, the list includes some of the best companies in the market but not always. ICInsider.com ranks stocks based on projected earnings, allowing investors to focus on the most undervalued stocks and helping to remove emotions in selecting stocks for investments that often result in costly mistakes.
IC TOP10 stocks are likely to deliver the best returns up to the end of May 2024 and are ranked in order of potential gains, computed using projected earnings 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 are ongoing, based on receipt of new information.
Persons who compiled this report may have an interest in securities commented on in this report.
