The Junior Market of the Jamaica Stock Exchange closed on Wednesday starting the new month positively with the Market Index climbing 53.30 points to 3,890.60 even as the volume of stocks traded declined 54 percent and the value 62 percent lower than on Tuesday after 47 securities changed hands compared to 46 on Tuesday and closed with 25 rising, 18 declining and 4 unchanged.
A total of 7,248,801 shares were traded for $17,264,479 compared to 15,831,268 units at $44,907,966 on Tuesday.
Trading averaged 154,230 shares at $367,329 down from 344,158 units at $976,260 on Tuesday. February closed with an average of 318,024 units at $782,332.
Regency Petroleum led trading with 2.97 million shares for 41 percent of total volume followed by Fosrich with 882,264 units for 12.2 percent of the stocks trading and Image Plus Consultants with 562,434 units for 7.8 percent market share.
The PE Ratio, a measure of computing appropriate stock values, averages 11.8, The PE ratios of Junior Market stocks are computed using the last traded stock price in conjunction with ICInsider.com projected earnings for the financial years ending between November 2022 and August 2023.
Investor’s Choice bid-offer indicator shows two stocks ending with bids higher than their last selling prices and five with lower offers.
At the close, Access Financial fell 36 cents to close at $25.59 with 5,228 shares being traded, Cargo Handlers popped 49 cents in closing at $15 after 2,048 stock units cleared the market, Caribbean Cream gained 18 cents to finish at $3.49 following investors trading 76 units. Caribbean Flavours rallied 25 cents to $1.70 with 78 stocks changing hands, Consolidated Bakeries lost 24 cents to end at $2.18 in switching ownership of 5,065 stock units, Dolla Financial shed 11 cents to end at $2.85 in an exchange of 105,206 stocks. Fosrich lost 11 cents ending at $2.99 with the swapping of 882,264 units, General Accident rose 39 cents in closing at $4.99 with 8,097 shares changing hands, Iron Rock Insurance fell 30 cents to $2 after a transfer of 50 shares. ISP Finance gained 51 cents to settle at $21 after switching ownership of 1,500 stocks, JFP Ltd dipped 25 cents to $1.70 in trading 487,595 units, Knutsford Express declined $1.13 to $11.87 after exchanging 7,445 stock units. Lasco Distributors lost 9 cents to finish at $2.70 with investors transferring 31,250 stock units, Lasco Financial advanced 28 cents to end at $2.74 in exchanging 750 stocks, Lasco Manufacturing gained 25 cents in closing at $4.22, with investors transferring 16,549 shares. Limners and Bards popped 10 cents to end at $2.75 with the swapping of 5,417 units, Lumber Depot dipped 15 cents to $2.25 after 54,162 stock units were traded, Main Event rose 75 cents to close at $11.95 with an exchange of 51,844 units. Medical Disposables shed 29 cents in closing at $4.85, with 5,300 shares changing hands, Regency Petroleum fell 52 cents to end at $1.91 after investors traded 2,970,829 stocks, following release of full year results, showing higher administrative costs that wiped out increased gross profit and Spur Tree Spices shed 23 cents in closing at $2.75 exchanging 348,494 shares.
In the preference segment, CAC 2000 9.5% preference share gained 8 cents to end at $1.08 with a transfer of 294 units.
Prices of securities trading are those for the last transaction of each stock unless otherwise stated.
Elite out Tropical back in ICTOP10
The Main Market of the Jamaica Stock Exchange closed the past week with gains in the indices. Still, the Junior Market suffered a significant loss on Friday to close the week with a loss following a sizable fall in the price of Fosrich. This most heavily weighted Junior Market stock fell from an average price of $3.20 at the previous week’s close down to $2.63.
ICTOP10 has only one new addition this week, in the Junior Market TOP10 and none in the Main Market, following major volatility in price movements in the listings.
In closing out the week, Iron Rock Insurance led stocks rising, with a gain of 13 percent to $2.30, followed by General Accident, that rose 6 percent to $4.99, while Main Event put on 4 percent to land at $10.80. Elite Diagnostic fell 21 percent to $2.45 as demand vanished for the stock following release of poor second quarter results. Paramount Trading fell 9 per cent to $2, Image Plus and Lasco Distributors dipped 5 percent to $1.90 and $2.60, respectively.
Five stocks rose in the Main MarketTOP10, with the price of Key Insurance rising 7 percent to $3.20, Sygnus Credit Investments rose 5 percent to $12.57, while 138 Student Living and Scotia Group popped 4 percent higher to $5.01 and $34.20, respectively. Berger Paints dropped 8 percent to $9.25, Caribbean Producers, Guardian Holdings and Jamaica Broilers lost 3 percent.
Earnings per share for Elite Diagnostic was revised down to 28 cents per share for the current year, following a small loss of $7 million in the December quarter, even as revenues rose a solid 20 percent or $30 million over the same quarter in 2021, resulting in the stock dropping out of the ICTOP10, to be replaced by Tropical Battery that is returning after a short absence.
At the end of the week, the average PE for the JSE Main Market TOP 10 is 5.4, well below the market average of 13.7, while the Junior Market Top 10 PE sits at 6.5 compared with the market at 11.6. The differences are important indicators of the level of the undervaluation of the ICTOP10 stocks. The Junior Market is projected to rise by 213 percent and the Main Market TOP10 by an average of 288 percent to May this year, assuming the market gets back to last year’s valuation. The primary concern for the Main Market achieving such gains by May is that the list is dominated by financial companies that are out of favour and may need to get to the summer months before the full interest of investors is visible.
The Junior Market has 13 stocks representing 27 percent of the market, with PEs from 15 to 27 averaging 19 compared with the above average of the market. The top half of the market has an average PE of 17. The above average shows the extent of potential gains for the TOP 10 stocks.
The situation in the Main Market is similar, with the 17 highest valued stocks priced at a PE of 15 to 109, with an average of 32 and 23 excluding the highest valued stocks and 21 for the top half excluding the highest valued stocks.
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 will likely deliver the best returns up to the end of May 2023 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, resulting 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.
More ICTOP10 additions
ICTOP10 has two new additions this week, all are Junior Market stocks, following modest price changes in the listings this past week, but the Main Market had mostly significant losses as that market hit a new low for the year during the week.
In closing out the week, Lasco Distributors rose 6 percent to $2.75, while Tropical Battery gained just 4 percent to $2.40. Iron Rock Insurance fell 15 percent to $2.03, the only declining stock above one percent.
Four stocks rose in the Main Market TOP10, with NCB Financial and Jamaica Broilers increasing 4 percent to $77.99 and $33.90, respectively. Caribbean Producers plunged 10 percent to $9.72 as investors reacted negatively to a near US$2m negative swing in second quarter profit on higher revenues that were up 16 percent in the period, JMMB Group lost 8 percent to close at $30.80, Key Insurance fell 7 percent to $3, but 138 Student Living and Scotia Group dropped 4 percent to $4.80 and $32.95 respectively.
Honey Bun rose modestly for the week and, along with Tropical Battery, climbed out of the Junior Market ICTOP10, allowing Lasco Manufacturing and Paramount Trading to return to the ICTOP10.
At the end of the week, the average PE for the JSE Main Market TOP 10 is 5.4, well below the market average of 13.6, while the Junior Market Top 10 PE sits at 6.3 compared with the market at 12, important indicators of the level of the undervaluation of the ICTOP10 stocks. The Junior Market is projected to rise by 220 percent and the Main Market TOP10 by an average of 288 percent to May this year. The primary concern for the Main Market achieving such gains by May is that the list is dominated by financial companies that are out of favour and may need to see the summer months before the full interest of investor start to show.
The Junior Market has 14 stocks representing 29 percent of the market, with PEs from 15 to 28, averaging 20 compared with the above average of the market. The top half of the market has an average PE of 17. The above average shows the extent of potential gains for the TOP 10 stocks.
The situation in the Main Market is similar, with the 17 highest valued stocks priced at a PE of 15 to 90, with an average of 33 and 25 excluding the highest valued stocks and 25 for the top half excluding the highest valued stocks.
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 will likely deliver the best returns up to the end of May 2023 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, resulting 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.