Sleepy ICTOP10 Sygnus Credit on the rise

October 26, 2021 by

Developments during the week for ICTOP10 Main Market stocks saw Sygnus Credit Investment adding another 5 percent to its value this past week on top of the 5 percent rise in the previous week to close at $18.65 from $17.80, to be up 17 percent for October. Sterling Investments rose 9 percent from $2.76 to $3 and Berger Paints gained 3 percent during the week. Caribbean Producers lost 2 percent, Guardian Holding fell 6 percent from $550 to $515 and Proven

Sygnus Credit Investments is up 17% in October.

Investments lost 7 percent to round out the main movements in ICTOP10 for the week. There were no additions to the ICTOP10 this week, but volatility continued, with Junior Market stocks bouncing up and down. Elite Diagnostic gained 3 percent to $3.10, Caribbean Assurance Brokers rallied 2 percent, from $1.75 to $1.79, Lumber Depot rose 2 percent to $2.89, with persistent selling above keeping a lid on price movement. Access Financial lost 7 percent to close at $17.25 from $18.50, AMG Packaging fell 7 percent to close at $1.80 from $1.93 after the company released full year results. Dolphin Cove dived 20 percent from $10.25 to $8.20, Medical Disposables with bright prospects for the future fell 10 percent to $4.74 and Stationery and Office Supplies slipped 2 percent to $6.40 from $6.50.
As 2021 slowly crawls to a close, the focus should be switching to 2022 along with the current year’s values to determine the appropriate valuation of each stock and the hold or fold decision. Most of the top 2021 stocks will not make the top 10 in 2022. The IC 80/20 rule, with a long 40 year history, shows an average of only two of the top ten stocks in a year repeat in the following one, while 4 out of 10 of the worst performing stocks will end up as TOP 10 winners in the succeeding year. The top seven stocks so far, with gains of 52 to 231 percent and three others gaining more than 100 percent are; Future Energy, Jamaican Teas, Fosrich, ISP Finance, Lumber Depot, Express Catering and Honey Bun. In the Main market, Caribbean Producers is 136 percent to date and is expected to deliver much more gains into 2022, Salada Foods rose 107 percent, Radio Jamaica has an increase of 103 percent, but investors can expect much more from this one but a lot is expected after the release of the September quarter results, Caribbean Cement is scheduled to release third quarter results next weekend, with the stock price up 88 percent for the year to date and Grace up 55 percent.
Elsewhere, Supreme Ventures released nine months results with 22 percent increased sales to $19.3 billion for the nine months but virtually flat third quarter sales of $6.3 billion with nine months profit slipping marginally from $1.55 billion to $1.54 billion and the third quarter falling from $596 million down to $311 million. Earnings per share ended at 57.7 cents and 11.8 cents for the quarter.  AMG Packaging released full year results, with profits of $62.6 million, up from $56 million in 2020 with earnings per share of 12 cents. The quarterly profit was $20 after tax and, in 2020, $18.4 million after a tax credit. Construction of the new facility is complete, and machinery and equipment are ordered and is expected to be installed during the November quarter.
The top three Main Market stocks are, Caribbean Producers currently consolidating around $7, but closed the week at $6.60, followed by Guardian Holdings and Berger Paints with expected gains of 238 to 264 percent versus last weeks’ 235 to 256 percent.
The top three stocks in the Junior Market are Elite Diagnostic, followed by Access Financial and Medical Disposables. All three have the potential to gain between 238 and 287 percent, from 220 percent and 300 percent previously.
The average gains projected for the TOP 10 Junior Market stocks moved from 200 percent last week to 213 percent and Main Market stocks remain at 173 percent.
The Junior Market closed the week with an average PE 13.2 based on ICInsider.com’s 2021-22 earnings and is currently well below the target of 20 and the historical average of 17 for the period to March this year, based on 2020 earnings. The TOP 10 stocks trade at a PE of a mere 6.5, with a 52 percent discount to that market’s PE.
The overall Junior Market can gain 49 percent to March next year, based on an average PE of 20 and 29 percent based on an average PE of 17. Nine stocks representing 25 percent of all Junior Market stocks with positive earnings are trading at or above this level, up from five last week, indicating that many others will rise above the 17 mark in the weeks ahead.
The average PE for the JSE Main Market is 15.6, which is 22 percent less than the PE of 19 at the end of March and 28 percent below the target of 20 to March 2022. The Main Market TOP 10 average PE is 7.7, representing a 50 percent discount to the market and well below the potential of 20. A total of 10 stocks or 22 percent of the market trade at or above a PE of 19, with most over 20, for an average PE of 25.5, suggesting that the accepted multiple maybe around 25 times the current year’s earnings.
The TOP10 is a selection of stocks that are most likely to deliver the largest gains within fifteen months. ICTOP10 focuses on potential 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.

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Kremi out Lumber Depot in ICTOP10

October 17, 2021 by

Caribbean Cream, with its Kremi brand of ice cream, reported disappointing second quarter results and fell out of the TOP 10 with full year earnings down to 65 cents, allowing Lumber Depot to return to the Junior Market ICTOP10. No other company moved in or out of the ICTOP10 stocks, valued at half that of the two overall markets.
Caribbean Cream half year’s results saw a modest 5 percent increase in sales in the second quarter, well below the first quarter increase of 28 percent, but cost rose above that of 2020, leaving a small profit of $7 million for the August quarter. The company’s management attributed the performance primarily to the no-movement days in operation during the quarter that curtailed sales. Knutsford Express returned to profit in the quarter of $9.2 million, from a loss in 2020 for the August quarter on improved revenues of $233 million from $122 million in 2020 but well off the $325 million in 2019. Paramount Trading had marginal movement in revenues for the August quarter of $369 million from $362 million in 2020, with a profit of $19 million versus $15 million in 2020.
Now that we are in the final quarter for 2021, many companies valuations will climb between now and early next year to further discount the current year’s earnings. Some stocks may therefore appear fully priced or close.  Investors should keep eyes on both this and next year’s earnings to determine the appropriate valuation of each stock and whether to hold or fold. The 80/20 rule of trading stocks should be ever present as the long 40 year history of the local market shows that only two out of each of the top ten stocks in a year repeat in the following while 4 out of 10 of the worst performing stocks end up as winners in the succeeding year. The lesson is that many of the top stocks for 2021 will not make it in 2022.
Elsewhere, in the Junior Market, AMG Packaging price bounced around in the week but closed at $1.93, Caribbean Assurance Brokers rallied 7 percent, from $1.63 to $1.75, Dolphin Cove rose from $9.69 to $10.25 and Stationery and Office Supplies moved up by 8 percent from $6 to $6.50.
In the Main Market, Guardian Holding fell from $577 to $550, Sygnus Credit Investment popped 5 percent from $16.96 to $17.80, to be up 11 percent in two weeks and Sterling Investments slipped 8 percent from $3.01 to $2.76. The latter two are flashing strong signals of higher prices ahead as active supplies on the sell side in the market are moderate.
The top three Main Market stocks are Caribbean Producers which is consolidating around $7, followed by Berger Paints and Guardian Holdings, with expected gains of 235 to 256 percent versus last weeks’ 219 to 264 percent.
The top three stocks in the Junior Market are Elite Diagnostic, followed by General Accident and Access Financial. All three have the potential to gain between 220 and 300 percent, down from 230 percent and 304 percent previously.
The average gains projected for the TOP 10 Junior Market stocks moved from 210 percent to 200 percent and Main Market stocks from 170 percent to 173 percent.
The Junior Market closed the week, with an average PE 13.4 based on ICInsider.com’s updated 2021-22 earnings and currently well below the target of 20 and the historical average of 17, for the period to March this year, based on 2020 earnings. The TOP 10 stocks trade at a PE of 6.8, with a 51 percent discount to that market’s PE.
The overall Junior Market can gain 49 percent to March next year, based on an average PE of 20 and 27 percent based on an average PE of 17. Nine stocks representing 25 percent of all Junior Market stocks with positive earnings are trading at or above this level, up from five last week, indicating that many others will rise above the 17 mark in the weeks ahead.
The average PE for the JSE Main Market is 15.4, 23 percent less than PE of 19 at the ended of March and 30 percent below the targeted PE of 20 to March 2022. The Main Market TOP 10 average PE is 7.7, representing a 50 percent discount to the market and  well below the potential of 20.  A total of 10 stocks or 22 percent of the market trade at or above a PE of 19, with most over 20, for an average PE of 25.5, suggesting that the accepted multiple may be around 25 times the current year’s earnings.
ICTOP10 is not intended to select the best stocks in the market but ones that are most likely to be the largest winners within a fifteen month period. ICInsider.com ranks stocks to highlight the winners from the rest, allowing investors to focus on potential winners, 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 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.

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Lumber back in ICTOP10

September 18, 2021 by

Markets keep bouncing around with no clear direction and could be weight down by a number of factors, including rising interest rates as Bank of Jamaica starts its tightening of the financial market, Barita Investments APO that will drain or divert funds from secondary trading of other stocks and the absence of any other major news that could move stock prices meaningfully. Against this background, there was little movement in and out of the ICTOP10 listings this past week.
Lumber Depot moved back into the ICTOP10 with the price pulling back under $3 and replaced tTech that enjoyed a price bounce from $4.20 last week to $4.50 this past week.
Elsewhere, in the Junior Market, Dolphin Cove rose $1 to $10.15 and Stationery and Office Supplies rose 85 cents to $6.60 and in the Main Market, Berger Paints rose $1.19 to $13.74, JMMB Group fell 76 cents to $35.74, Guardian Holdings dropped $19 to $590 and Grace Kennedy lost $2 to end at $100 as demand for the stock seems lukewarm at this stage of the market, with the third quarter results being a month and a half away and Sygnus Credit Investments rose 84 cents to $16.
The top three Main Market stocks are, Berger Paints followed by JMMB Group and Guardian Holdings, with expected gains of 212 to 257 percent for the three, versus last weeks’ 202 to 290 percent.
The top three stocks in the Junior Market, are Elite Diagnostic, followed by General Accident and Medical Disposables, with all three having the potential to gain between 224 percent and 291 percent, which is similar to last week.
This past week, the average gains projected for the Junior Market, moved from 209 percent to 197 percent and Main Market stocks moved from 170 percent to 173 percent.
The Junior Market closed the week with an average PE of 12 based on ICInsider.com’s 2021-22 earnings and currently trades well below the target of 20 as well as the historical average of 17, for the period to March this year, based on 2020 earnings. The TOP 10 trades at a PE of 6.9, with a 42 percent discount to that market’s PE and the potential to rise 67 percent to March next year, based on an average PE of 20.
The JSE Main Market ended the week with an overall PE of 16, a little distance from 19 the market ended at in March, suggesting a 23 percent rise at a PE of 19 and 29 percent at a PE of 20 from now to March 2022. The Main Market TOP 10 trades at a PE of 7.6, with a 52 percent discount to the PE of that market, well off the potential of 20.
ICTOP10 stocks are not intended to be a selection of the best stocks in the market but ones that are most likely to be the best winners within a fifteen months period. ICInsider.com ranks stocks to filter out the bigger winners from the rest, allowing investors to focus on potentially huge winners, helping to keep out emotional attachments to stocks that often result in costly mistakes being made.
 IC TOP10 stocks are likely to deliver the best returns up to March 2022 and ranked in order of potential gains, based on likely increase for each company, taking into account the earnings and PE ratios for the current fiscal year. Expected values will change as stock prices fluctuate and result in movements in and out of the lists weekly. 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.

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Bright profit spots but cloudy elsewhere

September 12, 2021 by

A number of listed companies recently posted results for the second quarter of 2021, with some recording a strong rise in revenues and outstanding profits or lower losses than in 2020 and a few with lower profits.
Fontana had a good year to June and for the June quarter. The Junior Market listed company reported profit that surged 85 percent for the year to June of $512 million, with earnings per share of 41 cents, up from a profit of $277 million in 2020, with revenues rising 14 percent to $5.15 billion from $4.5 billion in 2020.
Blue Power suffered a reversal in fortunes, with a suspension of exports of soaps to Caricom, following a decision of the Jamaica Government to stop issuing Certificates of Origin for soaps manufactured in Jamaica, using imported soap noodles.
For the quarter to July, total revenues fell 23 percent from $150 million generated in 2020 to $116 million, leading to profits from operations dropping 62 percent to $8 million, from $21 million in the previous year, but gains on sales of investments of $26 million and other income, resulted in after tax profit of $46 million.
Jamaica Broilers posted revenues that surged 32 percent to $17.6 billion from $12.5 billion in 2020 for the first quarter to July 2021 but profit of $275 million dropped 28 percent from $383 million in 2020, as the Jamaican and Haitian segments posted lower profits for the quarter as the USA segment enjoyed a 84 percent jump.
Revenues at KLE Group recovered from just $7.8 million in the June quarter in 2020 to $38 million this year, with the half year returning revenues of $73 million versus $80.5 million in 2020, with losses showing slight improvement to $18 million for the quarter from $24.6 million in 2020 and from a loss of $43.7 million in 2020 half year to $40 million in 2021.

Scotia Group

Revenues at Lumber Depot increased 16 percent to $420 million in the  July quarter, this year, from $361 million in 2020, helping to drive profits 140 percent higher to $71.8 million, from $29.9 million in 2020. The strong increase resulted from a surge in gross profit margin from 18.7 percent in 2020 to 24.6 percent in the 2021 July quarter and contributed $26 million to the $42 million of increased profit.
Scotia Group reported a profit of $2.8 billion, an increase of 81 percent over the depressed 2020 third quarter and slightly more than the $2.7 billion generated in the April quarter. Profit for the nine months jumped 31 percent from $5.6 billion to $7.3 billion as expected credit loss provision fell sharply from $5.3 billion in 2020 to $1.99 billion for the nine months to July, thus negating a fall in interest income and increased operating expenses and taxation.

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Lumber Depot profit bolted higher

July 15, 2021 by

Lumber Depot profit surges

Profits at Lumber Depot bolted 555 percent from $22 million for the nine months in 2020 to $145 million for the year ended April 2021, as it grew revenues 14.7 percent to $1.43 billion from $921 million in 2020 nine months period.
The company operates a hardware store in Papine, St Andrew, for more than two decades and generated revenues that rose 7 percent in the April quarter over the January 2021 quarter to $377 million from $353 million and 21 percent over the April 2020 quarter of $311 million. Gross profit margin for the full year was 21 percent, an improvement on the 18 percent for the 2020 nine months period. Administrative costs rose 42 percent to $154 million from $108 million in the nine months to March 2020, but it would be up by 7 percent if the comparative periods were the same number of months.
Cash inflows for the year pulled in $157 million, but after working capital adjustments the amount climbed to $186 million and ended the year with a net gain of $114 million after dividend payment of $14 million and loan repaymentof $33 million. The company has cash funds of $143 million and investments of $117 million at the end of April, with the latter shown as a noncurrent asset.
Current assets stood at $317 million and current liabilities at $139 million, resulting in net current assets of $178 million. Shareholders’ equity grew 68 percent to $523 million and pushed cash and investments to $360 million from $129 million in 2020.
The company reports earnings per share of 21 cents, up from just 3 cents in 2020.
The stock traded 580,827 units up to $3.65 in early trading on the Junior Market of the Jamaica Stock Exchange, but the price dropped back to close at $3.50  at a PE of 16.7 times 2021 earnings and 13 times ICInsider.com’s projection of 27 cents for 2022.

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Junior Market sets for record 4,230 points?

June 21, 2021 by

The Junior Market closed the week at 3,367.03 points with gains of near 28 percent for the overall market for the year to date and 66 percent from the 2020 low of 2,031.79 points on March 18 last year and now sits just 8 percent below the historical high for the market of 3,662.94 points back October 14, 2019.
The market was only above Friday’s close for one day in early January last year when the index closed at 3,378.20 points on January 3 and one day in June this year.
In the process, Lumber Depot gained 111 percent for the year, followed by Fosrich, 109 percent, Jamaican Teas 97 percent, Jetcon 96 percent, Stationery and Office Supplies, 76 percent, Express Catering 71 percent, Main Event 66 percent, Lasco Manufacturing and Caribbean Cream 41 percent.
The growth for the year to date would result in a 60 percent increase for the full year if the current trend continues and would see the market index rising to a record high of 4,230 points to sit just around the next area of resistance. That level would equate with an average PE of 16 times 2021 earnings and suggest that the current rally is likely to continue at a measured pace, similar to the rise from the 2020 low point.

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ICTOP10 – Guardian a better buy now

May 31, 2021 by

The average gains projected for the Junior Market fell from 225 percent last week to 218 percent as the prices of a number of the top 10 stocks rose during the past week, but with no new entrant to either Top 10 list. The average projected gains for the Main Market stocks move up from 162 to 169 percent helped in a big way by the fall of Guardian Holdings from $790 last week to $763.  

Guardian Holdings hit a low of J$750 on Friday.

The price slippage for Guardian shares below $790 provides investors a better value proposition, with the PE at 8.3 times, rather than 8.6 that the NCB Global offer price for the 2 million shares they are offering to the public.
The markets continue to face resistance this past week, with the Junior Market is trading at the very top of its upward sloping channel while the JSE Main Market sits a few thousand points away and facing turbulence in getting to the peak. With the two Lasco companies releasing results after the market closed on Friday it will be interesting to see what investors do with their prices. If they rise appreciable the resistance is likely to be broken and clear the way to move to a new yearly high in the weeks ahead.
The Junior Market closed the week at 3,329.50, up slightly from 3,324 at the end of the previous week. The JSE All Jamaica Composite Index ended at 454,375.81 on Friday, marginally lower than 454,479.33 at the close of the previous week.
The top three stocks in the Junior Market, remain unchanged for this week, with Elite Diagnostic heading the list, followed by Caribbean Assurance Brokers and Caribbean Producers, with the potential to gain between 255 to 303 percent. The top three Main Market stocks are Radio Jamaica in the number one spot, followed by PanJam Investments and Wisynco, with expected gains of 149 to 371 percent.
This week’s focus: RJR suffered badly from the effects of the curtailment of business in 2020 after showing signs of recovering from the prior years’ slow growth and high cost of operations. In 2020 they moved to deal with the pressure the fallout had and showed marked improvement in the second half of the calendar year. Importantly, there was significant cost cutting with the third quarter showing the effects with vastly improved results.
The impression given in the group’s December quarterly report is that the sharp fall in direct operating, selling and marketing costs were directly related to the fall off in revenues. That of course is only part of the story. The fall in cost has been far greater than the reduction in revenues suggesting that actual cost cutting was effected. ICInsider.com confirmed that the group that made some staff redundant also made changes by discontinuing unprofitable programs and publications. “Regarding cost reductions, some changes in the distribution network and workflows are permanent,” this publication was informed but revenues for some of the newspapers continue to run below pre Covid-19 levels.
The targeted PE ratio for the market averages 20 based on profits of companies reporting full year’s results, up to the second quarter of 2022. Fiscal 2020-21 ended March 2021 with the average PE at 17 for Junior Market stocks and 19 times for the Main Market.
The Junior Market with an average PE 12.4 based on ICInsider.com’s 2021-22 earnings, is currently trading below the target, as well as the recent historical average of 17, this represents another 37 percent rise in the market that would equate to a rise of 61 percent to March 2022. The Junior Market Top 10 stocks average a mere 6.4 at just 52 percent of the market average, indicating substantial gains ahead. The JSE Main Market ended the week with an overall PE of 7.8, some distance from the 19 the market ended March, suggesting a 17 percent rise from now to March 2022. The Main Market TOP 10 trades at a PE of 7.8 or 48 percent of the PE of that market and well off the potential of 20.
IC TOP10 stocks are likely to deliver the best returns up to March 2022 and ranked in order of potential gains, based on likely increase for each company, taking into account the earnings and PE ratios for the current fiscal year. Expected values will change as stock prices fluctuate and result in movements in and out of the lists weekly. 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.

 

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Guardian Holdings in ICTOP10

May 23, 2021 by

Guardian Holdings moved into the IC TOP 10 following the release of a prospectus from NCB Global that is offering 2 million shares to the public at $790 each, with the stock price falling immediately, after by more than $110, to be in line with the public offer price, valuing the company’s shares at 8 times 2021 projected earnings.

Guardian Holdings now in ICInsider.com’s TOP10.

Elsewhere, with the passage of earnings season, the markets have lost most of their recent firepower to drive prices forward at a time when the Junior Market is trading at the very top of its upward sloping channel while the JSE Main Market is a few thousand points away and in facing much turbulence in attempting to break through the peak.
At the start of the past week, the Junior Market pulled back from last Friday’s close, to sit just above the 3,300 level but climbed on each succeeding day of the week, but pulled back slightly on Friday to close at 3,324 points just a few points higher than at the end of the previous week. At the same time, the JSE Main Market made attempts to come close to the 460,000 mark of the All Jamaica Composite Index but was rebuffed on each occasion and ended the week at 454,479.33, up from 451,713.66 at the close of the previous week.
The Junior Market has to decidedly break through the upper limit of the trading channel, to free it to move on to the next area of resistance, just over 4,000 mark, but the Main Market has room to run for a few thousand points before it hits the channel top at 460,000 points.
There is a shakeup of the top three stocks in the Junior Market, this week. Elite Diagnostic heads the list, followed by Caribbean Assurance Brokers and Caribbean Producers, with potential to gain between 247 to 300 percent. The top three Main Market stocks are Radio Jamaica in the number one spot, followed by Wisynco and PanJam Investments, with expected gains of 151 to 344 percent.
The targeted PE ratio for the market averages 20 based on profits of companies reporting full year’s results, up to the second quarter of 2022. Fiscal 2020-21 ended March 2021 with the average PE at 17 for Junior Stocks and 19 times for the Main Market. With interest rates on government paper below 5 percent and likely to remain there for a few years, the likelihood is for the average PE ratios to climb higher during the next twelve months or so.
The Junior Market with an average PE 12.5 based on ICInsider.com’s 2021-22 earnings, is currently trading well below the target, as well as the recent historical average of 17, this represents another 36 percent rise in the market that would equate to a rise of 60 percent to March 2022. The Junior Market Top 10 stocks average a mere 6.2 at just 50 percent of the market average, indicating substantial gains ahead. The JSE Main Market ended the week with an overall PE of 16.5, some distance from the 19 the market ended March, suggesting a 15 percent rise from now to March 2022. The Main Market TOP 10 trades at a PE of 7.9 or 48 percent of the PE of that market and well off the potential of 20.
The average projected gain for the Junior Market IC TOP 10 stocks is 225 percent and 162 percent for the JSE Main Market, based on 2021-22 earnings. IC TOP10 stocks are likely to deliver the best returns up to March 2022 and ranked in order of potential gains, based on likely increase for each company, taking into account the earnings and PE ratios for the current fiscal year. Expected values will change as stock prices fluctuate and result in movements in and out of the lists weekly. 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.

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Profit gains push Berger & SOS out of ICTOP10

May 15, 2021 by
Stationery & Office Supplies hit a record high on Friday.

Stationery & Office Supplies – Montego Bay office.

Investors got a serious dose of a new set of company results and they liked a number of them, driving up prices of some up, following results that surprised positively. Many of the surprising ones matched the ICInsider.com forecast. Stationery & Office Supplies that was in the ICTOP10 up to last week reported earnings in line with ICInsider.com projections of $1 and investors pushed the price to a 52 weeks’ high of $9.50, with a gain of 109 percent for the year so far, with more gains ahead.
tTech is another company reporting earnings in line with the ICInsider.com forecast, with the stock jumping to $5.91 to be up 41 percent for the year. Berger Paints another TOP 10 stock up to last week, seems well on the way to earn $1.50, ICInsider.com forecasted, the price closed the week at $15, pushing it out of the TOP10. There are only 4,852 units on offer up to $17 thereafter, just over 154,000 between $18.99 and $19.86, Grace Kennedy reported a 26 percent rise in profit for the quarter, a continuation of good growth it enjoyed in 2020, but the market is yet to reward it with a price rise.
Access Financial and Key Insurance have moved into the TOP10 to fill the space left by the two stocks that fell out at the end of the week.
When ICInsider.com embarked on the 2021 profit forecast, it was a most difficult time due to the turbulence in the economy and businesses of many listed companies. Nevertheless, we boldly made our forecast and the first fruits are now showing and investors like them in driving up nine of 15 Junior Market stocks selected in January, bettering the gains for the year of 26 percent. Two stocks more than doubled and one is up 96 percent after more than doubling in trading for the year to date, earlier this week, before some profit taking set in. One stock rose 64 percent, one gained 43 percent, two 35 percent and two with 29 percent gain. Added to this is Future Energy Sources that was a part of the TOP10 listing starting at the end of February and has since gained 35 percent.
The ICTOP15 stocks in continuing an outstanding performance saw, Stationery & Office Supplies jumping 109 percent for the year to date, Lumber Depot 104 percent, Jamaican Teas 96 percent, Main Event 64 percent, Lasco Financial rose 43 percent, Caribbean Cream and Caribbean Producers up 35 percent, Lasco Distributors and MailPac a rise of 29 percent each.
The JSE Main Market is only up 4 percent year to date, but ICTOP15 stock selection saw Carreras and Grace Kennedy rising 37 percent, QWI Investments and Caribbean Cement up 29 percent, Seprod up 20 percent, Jamaica Producers 19 percent and Jamaica Broilers up 15 percent.
The bullish tone of both markets continues, but the Junior Market had hit the top line of an upward sloping channel that could act as resistance and is worth watching. The Main Market is a few thousand points away from its channel top, but those resistance points should be only temporary barriers if they, in fact become that.
The top three stocks in the Junior Market are headed by Elite Diagnostic followed by Medical Disposables and Jetcon Corporation, with the potential to gain between 245 to 283 percent. The top three Main Market stocks are Radio Jamaica in the number one spot, followed by Jamaica Broilers and PanJam Investment, with expected gains of 165 to 385 percent.
The targeted PE ratio for the market averages 20 based on profits of companies reporting full year’s results, up to the second quarter of 2022. Fiscal 2020-21 ended March 2021 with the average PE at 17 for Junior Stocks and 19 times for the Main Market. With interest rates on government paper below 5 percent and likely to remain there for a few years, the likelihood is for the average PE ratios to climb higher during the next twelve months.
The Junior Market, with an average PE 12.3 based on ICInsider.com’s 2021-22 earnings, is currently trading well below the target, as well as the recent historical average of 17. This represents another 39 percent rise in the market that would equate to a rise of 60 percent to March 2022. The Junior Market Top 10 stocks average a mere 6.4 at just 52 percent of the market average, indicating substantial gains ahead. The JSE Main Market ended the week with an overall PE of 16.5, some distance from the 19 the market ended March, suggesting a 15 percent rise from now to March 2022. The Main Market TOP 10 trades at a PE of 7.8 or 47 percent of the PE of that market and well off the potential of 20.
The average projected gain for the Junior Market IC TOP 10 stocks is 220 percent and 168 percent for the JSE Main Market, based on 2021-22 earnings. IC TOP10 stocks are likely to deliver the best returns up to March 2022 and ranked in order of potential gains, based on likely increase for each company, taking into account the earnings and PE ratios for the current fiscal year. Expected values will change as stock prices fluctuate and result in movements in and out of the lists weekly. 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.

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Major shakeup in Junior Market ICTOP10

May 8, 2021 by

The Junior Market had some major shakeup in some of the listings this past week as investors keep their eyes solidly on opportunities in this market, having slowly eating away at the above-average gains available in the market and driving prices of many stocks up and pushing the market back to early January 2020 level.
During the past week, Main Event surged nearly 33 percent from $3.50 to $4.65, pushing it from second spot last week to 10th this week. Medical Disposables dropped from the third position with a gain of 19 percent to $5.28, Stationery & Office rose from $5.71 to $6.45 and taking it from 5th to 7th position, while Lasco Financial moved up to 6th position from 9th last week, with no price change, Caribbean Producers moved up from 8th last week to 3rd this week and Caribbean Cream shifted from 7th to 2nd this week.
Stationery & Office, General Accident, Medical Disposables and Main Event that are at the edge on the Junior Market TOP10 could well drop out at any time as they are all bunched together with potential gains of 188 to 210 percent. In the Main Market, VM Investments, with potential gains of 128 percent and Berger Paints with 122 percent, could drop out soon. Results of companies to come shortly could result in changes in the list, depending on how investors respond to each.
The bullish tone of the two markets continues, with technical indicators and fundamentals of many companies keep on powering prices higher with many investors looking to the future with the recovery of the economy in mind and the impact that it will have on stocks.
Investors should expect a host of company results to hit the market next week as the mid-month date approaches. Watch these stocks over the next few weeks, Grace Kennedy, Jamaica Producers, PanJam Investment, Sagior Group, MailPac, Access Financial, Lasco Financial, Lasco Distributors, Caribbean Cream, ISP Financial.
The top three stocks in the Junior Market are headed by Elite Diagnostic, followed by Caribbean Cream and Caribbean Producers, with the potential to gain between 242 to 282 percent. The top three Main Market stocks are Radio Jamaica in the number one spot, followed by PanJam Investment and Jamaica Broilers, with expected gains of 166 to 413 percent.
The targeted PE ratio for the market averages 20 based on profits of companies reporting full year’s results, up to the second quarter of 2022. Fiscal 2020-21 ended March 2021 with the average PE at 17 for Junior Stocks and 19 times for the Main Market. With interest rates on government paper below 5 percent and likely to remain there for a few years, the likelihood is for the average PE ratios to climb higher during the next twelve months.
The Junior Market, with an average PE 12.2 based on ICInsider.com’s 2021-22 earnings, is currently trading well below the target, as well as the recent historical average of 17. This represents another 40 percent rise in the market that would equate to a rise of 60 percent to March 2022. The Junior Market Top 10 stocks average a mere 6.1 at just 50 percent of the market average, indicating substantial gains ahead. The JSE Main Market ended the week with an overall PE of 16.5, some distance from the 19 the market ended March, suggesting a 15 percent rise from now to March 2022. The Main Market TOP 10 trades at a PE of 7.7 or 47 percent of the PE of that market and well off the potential of 20.
The average projected gain for the Junior Market IC TOP 10 stocks is 229 percent and 173 percent for the JSE Main Market, based on 2021-22 earnings. IC TOP10 stocks are likely to deliver the best returns up to March 2022 and ranked in order of potential gains, based on likely increase for each company, taking into account the earnings and PE ratios for the current fiscal year. Expected values will change as stock prices fluctuate and result in movements in and out of the lists weekly. 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.

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