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.
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