Trading jumped sharply by the close of the Jamaica Stock Exchange Junior Market on Monday, with the volume of stocks traded surging 68 percent more than on Friday as the value of stocks trading jumped 131 percent higher than the previous trading day.
Market activity led to 41 securities trading compared to 42 on Friday, with 15 rising, 21 declining and five closing unchanged. At the close, the Junior Market Index fell 38.77 points to settle at 4,013.42.
The PE Ratio, a measure used to compute appropriate stock values, averages 21.8. The PE ratio of each stock in the attacked chart is based on ICInsider.com earnings forecast for companies with financial years up to August 2022.
Overall, 49,008,399 shares traded for $190,021,639 up from 29,255,984 units at $82,401,537 on the Friday. EduFocal led trading with 29.64 million shares and controlled 60.5 percent of total volume after trading at a record high, followed by JFP Limited with 5.42 million units for 11.1 percent of the day’s trade, Future Energy Source contributed 3.98 million units for 8.1 percent market share, iCreate had 1.57 million units changing hands for 3.2 percent market share and Fosrich ended with 1.52 million units for 3.1 percent of the trades.
Trading averaged 1,195,327 shares at $4,634,674 in contrast to 696,571 shares at $1,961,941 on Friday with the month to date, averaging 616,440 units at $2,354,900, up from 572,569 units at $2,182,126 on the previous trading day. February closed with an average of 370,064 units at $1,402,517.
Investor’s Choice bid-offer indicator shows three stocks ended with bids higher than their last selling prices and three, with lower offers.
At the close, AMG Packaging dropped 20 cents to close at $2.95 after trading 111,476 shares, Cargo Handlers fell $3 to $8.50, with 4,059 stocks clearing the market, Caribbean Cream rallied 52 cents in closing at $5.23 after switching ownership of 33,000 stock units. Dolphin Cove increased $2 to $26, with 233,348 units crossing the market, Express Catering lost 19 cents to end at $5.06 trading 43,078 stock units, Fosrich shed 65 cents in closing at $16.20 while exchanging 1,519,918 shares. Jamaican Teas rose 13 cents to end at $3.50, with 486,088 stocks changing hands, KLE Group popped 65 cents to $2.85 with the swapping of 20,852 units, Knutsford Express declined 15 cents to close at $7.85 in trading 11,860 stocks. Lasco Distributors fell 22 cents in ending at $3.48 after 47,266 stock units crossed the market, Lasco Financial shed 24 cents in closing at $3.20 with an exchange of 40,868 units, Limners and Bards declined 15 cents to end at $3.20 in exchanging 294,766 shares. Lumber Depot dropped 13 cents to $3.50 in an exchange of 909,098 stocks, Main Event gained 81 cents ending at a 52 weeks’ high of $9.14 after an exchange of 460,045 units, Spur Tree Spices lost 14 cents to close at $3.46, with 497,787 shares changing hands. SSL Venture climbed 30 cents to close at $2.20 after exchanging 41,161 stock units, Tropical Battery advanced 16 cents after ending at $2.17 and trading 685,585 stocks and tTech lost 34 cents to end at 3.91 with 55,488 units changing hands.
Prices of securities trading are those for the last transaction of each stock unless otherwise stated.
More changes to ICTOP10
The only major move in the Junior Market ICTOP10 listing, this week was a fall of 8 percent for Tropical Battery, while in the Main Market, Carreras rose 6 percent followed by Caribbean Producers with 5 percent, both dropped out of the TOP10, while Guardian Holdings and 138 Student Living both lost 5 percent for the week. The week’s movements resulted in no change to the ICTOP10 Junior Market stocks but Transjamaican Highway and Jamaica Broilers return to the list.
The Junior Market index closed up to 4,052.19 points, ahead of the 4,031 close of the previous week, helped by the strong gains in the two newly listed companies; JFP limited and EducFocal that jumped sharply during the week, with the former topping out at $2 to close the week up by 36 percent at $1.36, with a PE of 19 times projected 2022 earnings, while the latter jumped to $3.07 for an incredible gain of 207 percent with a PE of 38 based on projected earnings of 8 cents for 2022. Meanwhile, the Main Market continues to consolidate at a support level of around 440,000 points using the All Jamaica Composite Index, but the market drifted down below that level in the latter part of the week as NCB Financial dropped to a multi-year low of $91.01 on Wednesday, with little demand for the stock currently, but it may find support around the $105 level.
The Junior Market potential gains for the TOP 10 Junior Market stocks stand at 109 percent, much lower than the Main Market at 137 percent, an indication that Main Market is greatly undervalued. The top three stocks in the Junior Market are Elite Diagnostic, Medical Disposables followed by AMG Packaging, to gain between 122 and 133 percent.
The potential gains for Main Market stocks moved from 127 percent last week to this weeks’ 137 percent, with the top three being Guardian Holdings, JMMB Group followed by Sygnus Credit Investments all projected to gain between 169 and 198 percent versus 168 to 193 percent last week.
The average PE for Junior Market is well ahead of the average of 17 times 2020 earnings achieved at the end of March last year in moving to 21.8 based on ICInsider.com’s 2021-22 earnings, pushed up mainly by five stocks, with EduFocal and Main Event over 100 times 2021 earnings. Excluding the 5 highest PE ratios over 40, the average would be around 18. The JSE Main and USD Markets at 15.8 is well off from 19 in 2021. The TOP 10 stocks trade at a PE of a mere 8.6, with a 45 percent discount to that market’s average.
The average PE for the JSE Main Market is 20 percent less than the PE of 19 at the end of March and 24 percent below the target of 20 to the end of March this year. The Main Market TOP 10 average PE is 8.6 representing a 45 percent discount to the market, well below the potential of 20. The depressed PE of the main market is an indication that bigger investors are reluctant to be aggressive in buying into the market currently, with inflation, rising interest rates and war populating the headlines.
ICTOP10 focuses on likely yearly winners, accordingly, the list may or may not include the best companies in the market. ICInsider.com ranks stocks based on projected earnings to highlight winners from the rest, allowing investors to focus on potential winning stocks and helping to remove emotional attachments to stocks that often result in costly mistakes.
IC TOP10 stocks are likely to deliver the best returns up to March 2022 and ranked in order of potential gains, based on the possible 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 weekly movements in and out of the lists. 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.
Cargo Handlers exits ICTOP10 with 33% gain
Cargo Handlers returned to ICTOP10 listing last week and was another winner with gains of 33 percent, sufficient to move it out of the top flight Junior Market stocks. The stock joins a long list of high performance ICTOP10 stocks, including the 32 percent gain in Tropical Battery stock in the previous week.
Caribbean Assurance Brokers come back in the Junior Market list, while Sterling Investments makes it back to the Main Market listing at the expense of TransJamacian Highway after just one week, but investors should keep an eye for this one.
In a week when the Junior Market dropped 297 points in three days that pushed the index down to 3,871 points, it bounced on the last two days to close over 4,031, still 137 points from the record of 4,168.16, at the end of the previous week. Meanwhile, the Main Market continues to consolidate around support at 440,000 points measured by the All Jamaica Composite Index.
Recent IPOs JFP limited and EducFocal are set to list on Monday and Tuesday coming following the oversubscribed initial public offers.
During the past week, the Junior Market TOP10 listed Access Financial, Lasco Financial and Iron Rock Insurance gained 6 percent each while Medical Disposables fell 9 percent and Tropical Battery slipped 5 percent. In the Main Market, the primary movers are Guardian Holdings with a 4 percent gain, while JMMB Group fell 7 percent and Proven Investments declined by 5 percent.
The potential gains for the TOP 10 Junior Market stocks remained for a second week at 105 percent, much lower than the Main Market at 127 percent, an indication that the Main Market is undervalued. The top three stocks in the Junior Market are Medical Disposables followed by Elite Diagnostic and Lasco Distributors to gain between 122 and 133 percent, compared to 121 and 126 percent, previously.
The potential gains for Main Market stocks moved from 124 percent last week to this weeks’ 127 percent, with the top three being JMMB Group followed by Guardian Holdings and Sygnus Credit Investments all projected to gain between 168 and 193 percent versus 161 and 193 percent last week.
The average PE for Junior Market has surpassed the average of 17 times 2020 earnings achieved at the end of March last year in moving to 19 based on ICInsider.com’s 2021-22 earnings and is ahead of the JSE Main and USD Markets at 15.7 well off from 19 in 2021. The TOP 10 stocks trade at a PE of a mere 9, with a 48 percent discount to that market’s average.
All the stocks in the Junior Market can gain just 5 percent to the end of March this year, based on an average PE of 20. About a third of Junior Market stocks with positive earnings are trading at or above this level, averaging around 23.
The average PE for the JSE Main Market is 21 percent less than the PE of 19 at the end of March and 24 percent below the target of 20 to the end of March this year. The Main Market TOP 10 average PE is 9 representing a 43 percent discount to the market, well below the potential of 20. Around 15 stocks or a thirty percent of the market trade at or above a PE of 19, with most over 20, for an average roundabout 25, suggesting that the accepted multiple is between 20 and 25 times current year’s earnings. The depressed PE of the main market may be indicating that bigger investors are reluctant to be aggressive in buying into the market currently with inflation, rising interest rates and war populating the headlines.
ICTOP10 focuses on likely yearly winners, accordingly, the list may or may not include the best companies in the market. ICInsider.com ranks stocks based on projected earnings to highlight winners from the rest, allowing investors to focus on potential winning stocks and helping to remove emotional attachments to stocks that often result in costly mistakes.
IC TOP10 stocks are likely to deliver the best returns up to March 2022 and ranked in order of potential gains, based on the possible 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 weekly movements in and out of the lists. 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.