Sagicor Financial severely undervalued

Sagicor Cayman building.

The Barbados based Sagicor Financial is seriously undervalued with the shares selling at less than a half the multiple of the Trinidad based Guardian Holdings and its Jamaican based subsidiary Sagicor Group.
Sagicor Financial continues to reap success with net income for March quarter of US$39 million against a prior year’s US$27 million. Net income attributable to shareholders was US$20 million compared to the prior year, of US$17 million, an increase of 19 percent and continues the trajectory seen since they reported a loss in 2012.
For 2018 first quarter, the group adopted two new accounting standards effective January 2018 covering Revenue from Contracts with Customers and for Financial instruments. The standards change the way that financial instruments are recognised and measured. There was no significant impact on the implementation of both standards on the net assets of the Company Sagicor reported.
Total revenue for the quarter increased 5 percent to US$297 million, against US$283 million in 2017. Revenue included a one-time gain of US$5.3 million on the acquisition of the British American insurance portfolio but net investment and other income fell to $109 million from $115 million in the similar period in 2017. Policyholders’ benefits fell 5 percent to US$132 million, compared to US$138 million for the previous year. Operating expenses increased just 2 percent to US$118 million, compared to US$115 million in 2017.

Jamaica Sagicor Group contributes more than half of Sagicor Financial profits.

Group comprehensive income dropped to US$17 million, from US$32 million for the prior year, with shareholders’ comprehensive income of US$6 million, compared to US$21 million for the prior year. The decline in comprehensive income was mainly due to marked-to-market losses on our international bond portfolio.
Total assets amounted to US$7 billion, with liabilities of US$6 billion at the end of March with Group equity of US$932 million and equity attributable to the company’s shareholders of US$623 million. The Group’s debt was US$407 million with a debt to capital ratio of 30.4 percent.
Earnings per share for the quarter amounted 6.5 cents and continues the growth enjoyed in the 2017 full year of 23.7 US cents compared to 20 cents in 2016 and puts earnings for the full year for 2018 around 30 cents. The stock trades on the exchanges in Trinidad and Barbados, closed on the Trinidad and Tobago Stock Exchange, the more liquid of the two markets at TT$7.90 and trades at a PE of an attractive 4 times earnings, well below Guardian Holdings at around 10 times earnings.
Although, the group is based in Barbados, data shows Trinidadians as the major owners with 49.6 percent with Barbadian owing around 33 percent while more than half of the profits come from Jamaica.

IC Insider.com has placed a BUY RATING on Sagicor Financial.

JSE main market volume dives – Friday

Supreme Ventures dropped $2.75 to $12.25 on Friday.

Volume traded on the Jamaica Stock Exchange dropped back to low levels on Friday, ending with 1,921,527 units valued at $46,900,896 compared to 7,688,997 units valued at $220,155,817 changing hands on the main market on Thursday.
The low volume was built from Carreras with 417,958 units amounting to 21.75 percent of the day’s volume, followed by Scotia Group with 315,705 units accounting for 16.43 percent of volume traded and Berger Paints with 262,929 units with 13.68 percent of the volume traded.
At the end of market activities, 23 securities traded, compared to 28 on Thursday, in the main and US dollar markets as 9 stocks rose, 11 declined and 3 traded firm. At the close, the All Jamaican Composite Index falling by 1,070.06 points to 327,520.83 and the JSE Index declined by 974.94 points to 298,408.49.
Stocks with major price changes are, Caribbean Cement rose $2 to $37.50, PanJam Investment climbing $1 to $7. Grace Kennedy declined $1.15 to $48.50, JMMB Group fell $1.20 to $26.80, Kingston Wharves dropped $1.60 to $46.80, Sagicor Real Estate Fund fell $1.10 to $13.99, Scotia Group lost $1.90 to $49.10 and Supreme Ventures dropped $2.75 to $12.25.
Trading resulted in an average of 87,342 units valued at an average of $2,131,859 for each security traded. In contrast to 137,284 units for an average of $1,083,320 on Thursday. The average for the month to date is 279,765 shares with a value of $13,009,983, previously 292,000 shares with a value of $13,757,854. In contrast, April closed with an average of 708,206 shares with a value of $6,395,518 for each security traded.
In the US dollar market, Proven Investments traded 15,000 shares at 22 US cents. The JSE USD Equities Index advanced by 0.98 points to close at 174.28.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading shows 5 stocks ended with bids higher than their last selling prices and 3 closing with lower offers.
For more details of market activities see – 1,000 points fall for JSE main market – Friday.

1,000 pts fall for JSE main market – Friday

Stocks declined again in trading on the main market on Friday, with the JSE All Jamaican Composite Index declining 1,070.06 points to close at 327,520.83 and the JSE Index fell 974.94 points to 298,408.49.
Trading was characterized by big price movements in a number of stocks but with those declining outnumbering rising ones by a 3 to 1 margin.
The market closed with only 1,921,527 units valued at $46,900,896 trading, down from 7,688,997 units valued at $220,155,817 trading on Thursday. On Friday 22 securities changed hands, resulting in 9 advancing, 11 declining and 2 remaining firm.
In market activity, Barita Investments lost 15 cents and closed at $12.38, with 2,940 shares traded, Berger Paints ended at $20, after declining 21 cents with 262,929 stock units changing hands, Carreras concluded trading and gained 1 cent to $10.60, with 417,958 units, Caribbean Cement jumped $2 and finished at $37.50, with 104,243 shares trading, Ciboney Group rose 1 cents to 13 cents, with 10,850 shares. Grace Kennedy dropped $1.15 to end trading at $48.50, with 5,386 shares, Jamaica Broilers rose 20 cents to $21.70, with 11,080 stock units trading, Jamaica Producers lost 9 cents and finished trading at $16.51, with 22,786 units, Jamaica Stock Exchange closed at $7.40, with 7,579 shares. JMMB Group ended at $26.80, with 103,297 shares, Kingston Wharves declined by $1.60 and finished at $46.80, trading 7,000 stock units, Mayberry Investments settled at $6.17, with 8,100 units, NCB Financial Group rose 77 cents and ended trading at $95.75, with 24,497 shares. PanJam Investment gained $1 and closed at $47, with 23,518 stock units changing hands, Radio Jamaica finished 14 cents higher at $1.35, with 22,682 shares, Sagicor Group lost 2 cents to settle at $38, with 141,760 shares, Sagicor Real Estate Fund settled at $13.99, after falling $1.01 with 36,401 shares, Scotia Group dropped $1.90 to $49.10, with 315,705 units. Seprod finished trading at $36, with 7,000 shares, Supreme Ventures dived $2.75 and ended at $12.25, with 167,126 shares, Victoria Mutual Investments slipped 3 cents and concluded trading at $4.17, with 77,262 stock units and Wisynco Group finished at $10, with a rose of 30 cents and 141,428 units changing hands.
Prices of securities trading for the day are those at which the last trade took place. For more details of market activities, see “JSE main market volume dives – Friday.”

Junior Market in sharp fall – Friday

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GWest dropped to an all-time low of Friday of $2.10.

The Junior Market Index closed with a sharp 57.86 points drop on Friday to close at 2,893.95 trading on 21 securities up from 17 on Thursday.
The market closed with an exchange of 8,143,897 units valued at over $45,872,386 compared to 3,527,982 units valued at $15,057,338 on Thursday.
At the close of market activities, the prices of 4 securities advanced, 14 declined and 3 remained unchanged.
IC bid-offer Indicator|At the end of trading, the Investor’s Choice bid-offer indicator reading shows 7 stocks ending with bids higher than their last selling prices and 2 with lower offers.
Market activity ended with an average of 387,805 units for an average of $2,184,399 in contrast to 207,528 units for an average of $885,726 on Thursday. The average volume and value for the month to date amounts to 200,883 units with an average value of $683,346 and previously 127,177 units with an average value of $576,852. April closed with an average of 121,622 units at $506,803, for each security traded.
At the close of the market, Access Financial closed with a loss of $2.90 at $46.10, in trading 3,827 shares, Cargo Handlers fell 6 cents to $9.70, with 5,892 stock units, Caribbean Producers finished trading with a loss of 30 cents at $5.25, with 1,000,000 units, Consolidated Bakeries closed at $1.89, with 33,900 shares, Derrimon Trading concluded trading with a loss of 78 cents at $8.75, with 3,062,000 shares. Elite Diagnostic settled with a loss of 5 cents at $3.15, with 74,992 units, FosRich Group fell 5 cents to $2.34, with 108,048 shares, General Accident closed with a loss of 6 cents at $3.41, exchanging 9,500 stock units, GWest Corporation fell 20 cents to end at an all-time low of $2.10, with 128,800 units. Iron Rock finished 10 cents higher at $3.05, with 3,300,000 shares, Jamaican Teas ended trading at $4.55, with 4,633 stock units, Jetcon Corporation traded with a loss of 10 cents at $4.10, after 37,389 units changed hands, Knutsford Express ended at $12, with 6,550 shares. Lasco Distributors concluded trading with a loss of 42 cents at $4.02, with 4,622 stock units, Lasco Financial finished 35 cents higher at $5.99, with 107,562 units traded, Lasco Manufacturing settled with a loss of 30 cents at $3.90, with 91,340 shares, Main Event ended trading 2 cents higher at $7, with 14,166 shares. Medical Disposables traded 50 cents down to $4.50, with 6,522 shares, Paramount Trading finished trading with a loss of 25 cents at $2.75, after only 2,200 stock units changed hands, Stationery and Office closed with a loss of 2 cents at $9, with 138,777 units after trading down to $8.10 and tTech concluded trading 2 cents higher at $6, with 3,177 shares changing hands.
Prices of securities trading for the day are those at which the last trade took place.

Stocks mostly rise on TTSE – Friday

Scotiabank closed at a 52 weeks’ high on Friday.

The Trinidad & Tobago Stock Exchange ended trading on Friday with less securities trading than on Thursday but with prices ending mostly higher as 12 securities traded against 15 on Thursday leading to 7 advancing, 1 declining and 4 remaining unchanged.
The stocks that gained were mostly in the Market activity resulted in 220,145 shares at a value of $3,003,375 compared to 1,076,127 shares valued at $20,874,283 changing hands, on Thursday.
At close of the market the, Composite Index the Composite Index rose 2.65 points on Friday to 1,237.64, the All T&T Index gained 3.04 points to 1,725.32, while the Cross Listed Index inched higher by 0.31 points to close at 100.81.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading shows the market continuing to be weak as it closed with 1 stock ending with a higher bid than the last selling price and 6 with lower offers.
Gains| Guardian Holdings concluded trading by rising 50 cents and settling at $16.50, after exchanging 83,904 shares, NCB Financial Group added 25 cents and concluded trading at $5.50, after exchanging 51,783 shares, Republic Financial Holdings increased 16 cents and ended at $102.66, with 2,500 stock units changing hands, Sagicor Financial rose 4 cents and completed trading at $7.90, with 55,672 units, Scotiabank gained 1 cent and settled at a 52 weeks’ high of $64.01, after exchanging 2,086 shares, Trinidad & Tobago NGL gained 5 cents and completed trading at $29.05, with 601 units and Unilever Caribbean finished trading with a rise of 25 cents to $32.50, after exchanging 75 shares.
Losses| Prestige Holdings concluded trading with a loss of 14 cents and settled at $10.01, after exchanging 1,453 shares.
Firm Traded| Clico Investments completed trading at $20.20, with 18,407 units, First Caribbean International Bank settled at $8.89, after exchanging 499 shares, First Citizens concluded at $35, after exchanging 3,000 shares and National Enterprises completed trading at $9.65, with 165 units changing hands.
Prices of securities trading for the day are those at which the last trade took place.

Sygnus Credit IPO rakes in $3.8B

Some 3,200 applications with more than $3.8 billion chased after the Sygnus Credit Investments offer of 90,909,091 ordinary shares preliminary data out of the company is indicating.
The company went to market to raise J$1.3 million but have the option to upsize the amount it takes in case of over subscription of the offer.
The offer is expected to close on the Wednesday May 16 received applications from Jamaicans and persons from overseas including the wider Caribbean, IC Insider.com was informed. The company is likely to take up approximately 60 percent of the excess demand in keeping with the clause in the Prospectus that gave them the right to up lift the take in case of an oversubscription.
With the level of oversubscription, the total issued shares that was projected to be just over 250 million units should end up at just over 300 million ordinary shares.
Sygnus Credit Investments is a specialty private credit investment company, dedicated to providing non-traditional financing to medium-sized firms across the wider Caribbean region. These companies typically have revenues between US$5 million and US$25 million.
The investment objective of the Company is to generate attractive risk adjusted returns with an emphasis on principal protection, by generating current income, and to a lesser extent capital appreciation, through investments primarily in Portfolio Companies using private credit instruments.
The capital structure of the company and the choice of investing funds will tend to result in a return closer to fixed interest levels, but likely higher than some bank lending rates, in the short to medium term as such investors should be looking for steady growth but relatively high dividend payments in the medium term. The falling interest rates on Jamaican dollar money market instrument will make the dividend payment very attractive source of income.
The company intends to pay out up to 85 percent of its net income as dividends to shareholders, payable on a quarterly basis. The target dividend yield is over 7 percent on the IPO price.
At December 2017, SCI had US$16.7 million in assets and generated net profits of US$660,855. The value of investment in Portfolio Companies was US$11.6 million, generating a yield of 10.3 percent.
Earnings for 2019 fiscal year could be around J$1-1.2 per share and that could see the stock trading between $15 and $20 within twelve months. Returns could be greater if they use borrowed funds to meet some of the demand they have for funding.
The Company currently has a robust pipeline of US$31.4 million in deals to finance, of which US$3.2 million has been approved, US$12.3 million has been mandated and US$15.9 million are at various stages of prospecting.

Big gains on Thursday push TTSE

Demand rises for Republic Financial Holdings

Strong gains in Guardian Holdings, Republic Financial Holdings and NCB Financial helped to push the Trinidad & Tobago Stock Exchange market indices up on Thursday as trading level rose sharply.
The movement in Guardian and NCB shares followed a report that the NCB and disgruntled minority shareholders of Guardian were to meet to have discussions in an attempt to resolve concerns about the pricing of the offer. Republic gains follows strong March quarter results and pent up demand for the stock.
The market ended trading in 15 securities against 16 on Tuesday, with 7 advancing, 3 declining and 6 remaining unchanged. Market activity resulted in 1,076,127 shares valued at $20,874,283 compared to 335,799 shares at a value of $3,449,592 changing hands, on Wednesday.
At close of the market the, Composite Index the Composite Index jumped 8.29 points on Thursday to 1,234.99, the All T&T Index rose 5.67 points to 1,722.28, while the Cross Listed Index gained 1.50 points to close at 100.50.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading shows the market continuing to be weak as it closed with 2 stocks ending with higher bids than the last selling prices and 5 with lower offers.
Gains| Grace Kennedy closed with a gain of 5 cents and settled at $3.05, with 301,234 units traded, Guardian Holdings gained 70 cents and concluded trading t $16, after exchanging 372,650 shares, Guardian Media finished trading with a gain of 1 cent and ended at $65.06, after exchanging just 6 shares, JMMB Group finished trading after an increase by 1 cent and completed trading at $1.73, with 149,834 stock units changing hands, NCB Financial Group rose 20 cents and ended at $5.25, after exchanging 49,276 shares, Republic Financial Holdings finished 79 cents higher and completed trading at $102.50, with 1,209 stock units changing hands and Trinidad Cement rose 24 cents to $2.99, after exchanging 90 shares.
Losses| Ansa Mcal shed 23 cents and settled at 52 weeks’ low of $59, with 143 units, National Flour lost 5 cents, ending at $1.75, after exchanging 400 shares and Unilever Caribbean dropped $1.75 and ended at $32.25, after trading 1,810 shares.
Firm Traded| Ansa Merchant concluded market activity at $40, after exchanging 500 shares, Clico Investments settled at $20.20, with 3,678 units, First Caribbean International Bank ended trading at $8.89, after exchanging 1,250 shares, Point Lisas settled at $3.81, with 1,283 units, Trinidad & Tobago NGL closed at $29, with 65,343 units and West Indian Tobacco completed trading at $88.50, with 127,421 stock units changing hands.
Prices of securities trading for the day are those at which the last trade took place and are in TTSE dollars.

JSE main market attempts recovery – Thursday

Trading on the main market of the Jamaica Stock Exchange ended on Thursday with JSE All Jamaican Composite Index jumped 1,822.14 points to 328,590.89 and the JSE Index climbed 1,660.18 points to 299,383.43.
Volume traded on the Jamaica Stock Exchange fell sharply from Wednesday’s level, ending with 3,157,522 units valued at $24,916,371 compared to 7,688,997 units valued at $220,155,817 changing hands on the main market on Wednesday.
The lower volume was built from Ciboney Group with 1,660,000 units accounting for 52.57 percent, followed by JMMB Group 7.25% preference share with 345,000 units or 10.93 percent of the day’s volume.
At the end of market activities, 24 securities traded, compared to 23 on Wednesday, in the main and US dollar markets. Only 13 stocks rose, 6 declined and 5 traded firm.
Stocks with major price changes are, Caribbean Cement losing $2 to $35.50, Grace Kennedy rising $1.45 to $49.65, JMMB Group rising $1.50 to $28, Kingston Wharves climbed $1.90 to $48.40, Sagicor Real Estate Fund gained $1 to end at $15 and Supreme Ventures climbed $2.30 to an all-time high of $15.
Trading resulted in an average of 137,284 units valued at an average of $1,083,320 for each security traded. In contrast to 366,143 units for an average of $10,483,610 on Thursday. The average for the month to date is 292,000 shares with a value of $13,757,854, previously 303,017 shares with a value of $14,739,384. In contrast, April closed with an average of 708,206 shares with a value of $6,395,518 for each security traded.
In the US dollar market, Productivity Business ended trading at 59 US cents with 5,000 shares. The JSE USD Equities Index advanced by 0.13 points to close at 173.30.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading shows 8 stocks ended with bids higher than their last selling prices and 2 closing with lower offers.
For more details of market activities see – JSE main market volume down prices up – Thursday.

Junior Market in sharp jump – Thursday

The Junior Market Index almost erased the sharp fall on Wednesday by rising 39.95 points on Thursday to close at 2,951.81 trading on 17 securities down from 21 on Wednesday.
The market closed with an exchange of 3,527,982 units valued at $15,057,338 compared to 4,267,590 units valued at $17,190,562 on Wednesday.
At the close of market activities, the prices of 11 securities advanced, 3 declined and 3 remained unchanged and Stationery and Office closed at a new high of $9.02 after trading at an intraday high of $10.
IC bid-offer Indicator|At the end of trading, the Investor’s Choice bid-offer indicator reading shows 4 stocks ending with bids higher than their last selling prices and 3 with lower offers.
Market activity ended with an average of 207,528 units for an average of $885,726 in contrast to 203,219 units for an average of $818,598 on Wednesday. The average volume and value for the month to date amounts to 127,177 units with an average value of $576,852 and previously 122,282 units with an average value of $558,032. April closed with an average of 121,622 units at $506,803, for each security traded.
At the close of the market, with 36,784 units, Cargo Handlers settled with a loss of 8 cents at $9.76, in exchanging 4,154 shares, Caribbean Producers finished trading 26 cents higher at $5.55, with 6,500 units, Consolidated Bakeries closed with a loss of 1 cent at $1.89, after trading 10,000 shares, Derrimon Trading concluded trading 3 cents higher at $9.53, with 5,000 shares, Dolphin Cove rose 50 cents to $15, with 4,683 stock units. Elite Diagnostic settled with a loss of 5 cents at $3.20, with 36,784 units, Express Catering jumped 42 cents to $6.05, with 4,350 shares trading, FosRich Group rose 4 cents to end at $2.39, with 31,010 shares, GWest Corporation closed trading at $2.30, with 13,000 units. Honey Bun concluded trading 1 cent higher at $4.70, with 30,356 shares, Jetcon Corporation traded at $4.20, with 40,233 units, KLE Group closed at $2.80, with 1,500 shares, Lasco Distributors concluded trading after rising 39 cents to $4.44, with 308,020 stock units. Lasco Financial finished 24 cents higher at $5.64, with 24,040 units, Lasco Manufacturing settled 15 cents higher at $4.20, with 2,944,659 shares, Main Event gained 3 cents in closing at $6.98, with 5,143 shares and Stationery and Office closed 2 cents higher at $9.02, with 58,550 units changing hands.
Prices of securities trading for the day are those at which the last trade took place.

JSE main market volume jumps – Wednesday

Volume traded on the Jamaica Stock Exchange picked from the very low levels on Tuesday, and ended with 7,688,997 units valued at $220,155,817 changing hands, compared to only 1,229,027 units valued at $11,204,886 trading on the main market on Tuesday.
The increased volume was built from high volumes in JMMB Group that ended with 1,999,978 units amounting to 26.01 percent of the day’s volume, followed by Kingston Wharves with 1,801,850 units accounting for 23.43 percent of volume traded, PanJam Investment with 1,094,320 units or 14.23 percent of the volume. Supreme Ventures traded 1,012,460 units and the Jamaica Stock Exchange ended with 1,033,290 shares changing hands.
At the end of market activities, 22 securities traded, compared to 28 on Tuesday, in the main and US dollar markets. Only 8 stocks rose, 11 declined and 10 traded firm. At the close, the All Jamaican Composite Index dropped 2,542.85 points to 326,768.75 and the JSE Index dived 2,316.83 points to 297,723.25.
Stocks with major price changes are, Jamaica Broilers rose $1.10 to $21.70, Proven Investments trading in the main market jumped $1.99 to a new high of $28.50 but countering these gains were, a fall of $2.49 in the price of Kingston Wharves to $46.50, a drop of $1.64 for PanJam Investment to $45.36 and Scotia Group falling $3.39 to $50.10.
Trading resulted in an average of 366,143 units valued at an average of $10,483,610 for each security traded. In contrast to 51,209 units for an average of $466,870 on Tuesday. The average for the month to date is 303,017 shares with a value of $14,739,384, previously 298,627 shares with a value of $18,119,875. In contrast, April closed with an average of 708,206 shares with a value of $6,395,518 for each security traded.
In the US dollar market, Proven Investments traded 5,332 shares at 22 US cents. The JSE USD Equities Index advanced by 3.69 points to close at 173.17.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading shows 6 stocks ended with bids higher than their last selling prices and 2 closing with lower offers.
For more details of market activities see – JSE main market make big gains – Wednesday.