The Junior Market and the JSE USD market were relatively stable in trading on Wednesday, with the Main Market of the Jamaica Stock Exchange declining meaningfully as trading ended with the number and the value of shares trading rising sharply over that on Tuesday as trading ended with 37 ordinary shares rising and 34 declining.
At the close of trading on Wednesday, the JSE Combined Market Index rallied 503.65 points to end trading at 336,013.76, while the All Jamaican Composite Index declined 3,548.11 points to 357,372.64, the JSE Main Index declined 2,758.68 points to lock up trading at 320,529.65. The Junior Market Index slipped 5.71 points to 3,741.82 points and the JSE USD Market Index rallied 1.02 points to end trading at 240.82.
At the close of trading, 16,686,862 shares were exchanged in all three markets, up from 14,586,125 units on Tuesday, with the value of stocks traded on the Junior and Main markets amounted to $145.58 million, up from $38.46 million on Tuesday and the JSE USD market closed after only 22,109 shares were exchanged for US$25,157 compared to 135,574 units at US$3,223 on Tuesday.
Main Market trading was dominated by Wigton Windfarm led trading with 3.67 million shares followed by Jamaica Broilers with 3.22 million units, JMMB Group 7.5% ended with 2.35 million units and Transjamaican Highway with 1.03 million units.
In the Junior Market, Dolla Financial led trading with 1.31 million shares, followed by One Great Studio with 558,940 units and iCreate with 323,373.
At the close of the market, Main Market stocks rising are AS Bryden that rallied $1 and ended at $40, Caribbean Cement climbing $2.24 to $57, NCB Financial gaining $1.30 in closing at $67.50.
Declining Main Market stocks include Guardian Holdings down $5 to $390, Jamaica Stock Exchange dipping 96 cents to $10.06, Mayberry Group declining 95 cents to $7.50, Mayberry Jamaican Equities shedding 89 cents to close at $9.01, Proven Investments dropping $1.30 and ended at $22.18 as Sagicor Group skidded $1.07 to end at $44.93 and Seprod sank $1.99 and ended at $83.
In the Junior Market, rising stocks include Main Event which rose 67 cents to close at $14.97 and the stock with the largest loss in the Junior Market was AMG Packaging fell 64 cents to $2.36.
In the preference segment, Jamaica Public Service 7% rose $8.17 in closing at $48.17 and Productive Business Solutions 10.5 % preference share rallied $40 to end at $1,100.
The market’s PE ratio, the most popular measure used to determine the value of stocks, ended at 21.6 on 2022-23 earnings and 13.9 times those for 2023-24 at the close of trading. ICInsider.com PE ratio chart and the more detailed daily charts provide investors with regularly updated information to help decision-making.
The PE ratio chart covers all ordinary shares on the Jamaica Stock Exchange, grouped by industry, allowing for easy comparisons between the same sector companies and the overall market. The EPS & PE ratios are based on 2023 and 2024 actual or projected earnings, excluding major one off items.
Investors need pertinent information to navigate numerous investment options successfully in the stock market. The ICInsider.com PE ratio chart and the more detailed daily report charts provide investors with regularly updated information to help decision-making.
Investors should use the chart to help make rational decisions when investing in stocks close to the average for the sector and not going too far from it unless there are compelling reasons to do so. This approach helps to remove emotions from investment decisions and place them on fundamentals while at the same time not being too far from the majority of investors. Investors who buy when the price of a stock is close to the average will find that they are not inclined to overpay for a stock.
The net asset value of each company is reported as a guide to quickly assess the value of stocks based on this measure. The chart also shows daily changes in stock prices and the percentage year to date price movement based on the last traded prices.
Dividends paid or payable and yields for each company are shown in the Main and Junior Markets’ daily report charts, along with the closing volume pertaining to the highest bid and the lowest offer for each company.
220% jump in Guardian Q2 profit
Profit at Guardian Holdings for the June Quarter jumped a robust 220 percent to TT$256 million from only $80 million in 2021, with the half year moving up by a substantial 70 percent from $256 million to TT$436 million, with the EPS coming out at TT$1.88 or J$43 for the half year and TT$1.10 for the three months.
Guardian Holdings hit a 52 weeks’ high of $35.25 on Tuesday.
Guardian did not report the earnings per share for the June quarter, information that all Jamaican listed companies have to report. The other element not reported on are the number of shares issued that would give relevant information for readers of the financials. ICInsider.com projects earnings of TT$3.88 or J$90 for the whole year.
The group suffered losses on long term investment instruments amounting to $400 million for the half year, which resulted in a profit to shareholders of just $73 million, the loss in the quarter was $205 million, that helped plunge the profit to $83 million. Most of the investment losses would have emanated from the rise in interest rates and fall in the value of equity investments. They may not recur to the same degree in the future as such profit from regular operations should dominate in valuing the stock.
The big surge in profit before other comprehensive income flows from a meagre 5 percent rise in net premium income for the six months to $2.37 billion and for the quarter to $1 billion, but net results on Insurance Activity jumped 63 percent to $681 million while the quarter produced a 99 percent rise to $415 million. Net Investment Income brought in 26 percent less in the half year to $570 million from $770 million, with the quarter dropping 39 percent to $265 million and resulted from a 5 percent rise in income for the six months to $1.33 billion and for the quarter to $715 million from $682 million.
Operating expenses fell 3 percent in the half year to $742 million and 11 percent in the quarter from $460 million to $410 million. Finance Changes were flat at $104 for the six months and $52 million for the quarter.
The segment report shows the profit for the Life health and pension division enjoying a 4.8 rise in underwriting revenues to $1.9 billion, with profit climbing 64 percent to $492 million. The general insurance division saw underwriting revenues rising just 2 percent to $649 million, with profit falling from $137 million to $101 million.
Shareholders’ equity stood at $4.9 billion with total assets of $35 billion. Major assets include Investment property valued at $1.65 billion, Investment securities of $23 billion, loans and receivables of $2.44 billion, and Cash and equivalent at $3.9 billion. The significant liabilities include Insurance contracts of $19.6 billion, financial liabilities presumable loans of $3.5 billion and third party investment liabilities at $5 billion.
The price of Guardian Holdings jumped a sharp 29 percent to J$650 on limited volume on Friday on the Jamaica Stock Exchange with a PE ratio of 7. There are less than 1,000 shares offered for sale in the Jamaican market. It traded at TT$26.50 in Trinidad on Friday at a PE of 6.8. The stock is severely undervalued.
NCB to go for 62% of Guardian
NCB Financial Group is to go after 62% of Guardian Holdings.
This is in line with the original offer made in 2017 but at higher price and above the 51.85 percent at US$2.65 they agreed to, after being investigated by the Trinidad Exchange Commission. The revised offer which will be published soon, with the exact timing is yet to be determined. The acquisition is to be partially funded by US$45 million to be provided by way of vendors’ loan from selected shareholders.
The acquisition is set to make a major impact on the NCB Group and ultimately the stock price. For one GHL is being bought for just less than 10 times earnings while NCB is selling at 15 times 2018 earnings as such the impact on the price of NCB shares will be seen in 2019 as GHL profit will be
Guardian Holding
NCB already owns 29.99 percent of Guardian. The GHL shares last traded in Trinidad at TT$16.95 or approximately US$2.53. NCB closed trading on the Jamaica Stock Exchange at $148.
NCB locked up Guardian from 2016
NCB Financial Group locked up the majority ownership in Guardian Holdings from as far back as May 2016, when they acquired 29.99 percent of the group’s shares, the maximum they could acquire without triggering a take bid clause that would require them to make an offer for all of the issued shares.
Funding the full offer, would have been a problem at the time and NCBFG would need Bank of Jamaica approval to do so which might not have been granted at that time. According to the offer document from the NCB Group to acquire up to 62 percent of the shares, “in May 2016 NCBFG acquired the entities which held the offeror’s shares from affiliates of Arthur Lok Jack, Imitaz Ahamad and International Finance Corporation. Pursuant to such transaction, Arthur Lok Jack, Imitaz Ahamad and their respective holding companies agreed that they would tender their respective shares in GHL to NCBFG upon NCBFG making a tender offer to all Guardian shareholders.”
Shares held by the two sellers are close to 22 percent of the issued shares of the Guardian Group which will be enough for NCB group to hold the majority of at least 32 percent. The price of US$2.35 is below the price the stock trades in Trinidad at, as such is not expected that many shareholders other than those mentioned above and a few other will be tendering shares.
