The two main Jamaica Stock Exchange markets may have broken loose from the area of resistance, but they continue to be hemmed in around current trading levels, with Junior Market closing below last week’s close with three days of decline and the
Main market had three days of decline but ended the week with a fall of points after recording a strong rise the previous week.
Caribbean Cream is back with earnings per share now at 70 cents for the current year, while Future Energy Source reached new highs during the week and is out of the IC Junior Market TOP10. In the Main Market, there was no change in the list, but earnings per share for JMMB Group is upgraded to $6 for the current year and the stock is now the second best main market stock, with potential to gain over 200 percent for the next twelve months.
There are still several stocks that are severely undervalued, with the scope to record above average gains up to the first half of 2022.
This past week the average gains projected for the Junior stocks slipped from 207 percent last week to 204 percent and the Main Market stocks moved up from last week’s 166 percent up to 172 percent with the upgrading of JMMB earnings.
The top three stocks in the Junior Market continue to be Elite Diagnostic heading the list, followed by Caribbean Assurance Brokers and Medical Disposables, with the potential to gain from 254 to 276 percent, after the range fell from 247 to 300 percent last week. The top three Main Market stocks are Radio Jamaica in the number one spot, followed by JMMB Group and Guardian Holdings, with expected gains of 171 to 379 percent versus last weeks’ 160 to 391 percent.
The Junior Market closed the week with an average PE 13.1 based on ICInsider.com’s 2021-22 earnings and currently trades well below the target of 20 and the recent historical average of 17 for the period to March this year based on 2020 earnings. For the market to trade at the historical average, the PE Ratio would have to rise by 31 percent and require a rise of 52 percent to March 2022 to reach the targeted PE of 20.
The Junior Market Top 10 stocks average PE is a mere 6.8, just 51 percent of the market average, indicating substantial gains ahead. The JSE Main Market ended the week with an overall PE of 17.1, a little distance from the 19 the market ended at in March, suggesting just an 11 percent rise at a PE of 19 and 17 percent at a PE of 20 from now to March 2022. 
The Main Market TOP 10 trades at a PE of 7.9 or 46 percent of the PE of that market, well off the potential of 20.
IC TOP10 stocks are likely to deliver the best returns up to March 2022 and ranked in order of potential gains, based on likely 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 movements in and out of the lists weekly. 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.
