Pulse no 1 stock in 2016 & 2017

Data going back 30 years show that on only very rare occasions more than 2 stocks appear in the TOP for two consecutive years. 2017 is one such exception with 3 stocks doing so.
Pulse Investments retains the number 1 best performing main market stock position in 2017 with a gain of 256 percent, the stock also was also in the TOP 10 in 2016 at number 1 position for local stocks with gains, then of 350 percent. Berger Paints ended at the number 6 best performing stock in 2016 with gains of 200 percent and repeated in the 2017 TOP 10 with a rise of 196 percent, for the 2017 number 2 spot. Palace Amusement ended at 7 position in 2016 with a rise of 134 percent and rose 187 percent in 2017 to hold down the number 3 spot and is followed by Supreme Ventures at number 4.
The stocks from the 2017 top 10 that could repeat in 2018 include Berger Paints, Palace and Pulse, with JMMB Group looking to have a chance.

NCB & LascoFin close acquisitions

NCB Financial and Lasco Financial are reporting conclusion of the acquisition of their new subsidiaries.
NCB Financial acquisition of the majority shares in Bermuda’s Clarien Bank that was subject to regulatory approval by the Bermudan authorities is concluded.
Clarien has assets just over U$1.16 billion and reported profit of US1.2 million for 2016 before incurring an overall loss when other comprehensive loss is factored in, netting a loss of US$572,000 for the year. Results were weighed down by impairment losses on loans amounting to US$8.6 million in the year compared to US$9.2 million in 2015.
Lasco Financial advised that Scotia Group Jamaica has completed the transfer of Scotia Jamaica Microfinance Company Limited to the company. No details of the purchase price is mentioned but Scotia Group reported on the balance sheet as of October, assets held for sale amounting to $664 million which most likely represent the assets of CrediScotia.

NCB’s next stop Republic Holdings?

The price of US$2.45 offered by NCB Financial‘s for 32 percent more ownership in Guardian Holdings, is below the price the stock is trading at on the Trinidad and Tobago Stock Exchange of TT$18 or US$2.67. 
They need not worry, as they are virtually assured of getting the amount needed, based on the interest that Chairman Arthur Lock Jack has influence over in the Group. The acquisition of the added Guardian shares, will give the bigger NCB control over 2.6 million shares or just over 1.6 percent in Republic Financial Holdings, up from 2.17 million units in 2016, in Trinidad’s largest banking group. But that would be the start of a much bigger prize, that of control over Republic Holdings. Acquiring control of Republic while much more costly that the case of Guardian, will not be too difficult, as the Government of Trinidad and Tobago has directive over a large portion of Republic.
Clico Trust holds 40 million shares or 24.69 percent of Republic, the trust has a finite life of 10 years ending in 2021, while an addition 9.98 percent is held by CLICO Investment Bank (In liquidation) and Colonial Life owns 11.786 million units or 7.26 percent. All three amounts are subject to the direction of the Government of Trinidad who will be willing to sell to the right candidate, but the Colonial Group held 51 percent prior to the Government taking over some of the assets of the group.
The early target would be the Clico’s holdings, an amount set aside to compensate creditors in the Colonial Group. Sale of the Republic shares would allow for liquidation of the trust fund with investors getting an early exit and give NCB Financial an ownership level that would allow for booking any such acquisition as an associate.
Acquiring majority shares in Republic won’t be as easy as Guardian Holdings, while the capitalization of the latter is TT$4, Republic is now over TT$16 billion. NCB currently has assets at the end of September is US$5.5 billion but Republic assets are US$10.3 billion. Earnings per share for Republic at September 2016 was 88 us cents climbing in 2017 to US$1.16.
NCB Group total assets with the acquisition of majority shares in Clarien Bank will be in the region of US$7.6 billion and with majority shares in Guardian US$12 billion.
Acquisition of majority shares in Republic would give NCB a footprint in a number of Caribbean countries that the Bank has no interest in presently. The countries include Suriname, Guyana and Grenada.

NCB Group goes for 62% of Guardian

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NCB set to increase shares in Guardian Holdings.

NCB Financial Group announced the launch an offer and take-over bid to acquire up to 74,230,750 ordinary shares in the Trinidad based Guardian Holdings at US$2.35 each, through its wholly-owned subsidiary, NCB Global Holdings Limited.
Guardian Holdings, a publicly-traded company listed on the Trinidad and Tobago Stock Exchange, and last traded at TT$16.55 around US$2.45. Guardian has 231,899,986 ordinary shares in issue with NCB Group holding approximately 69,547,241 units acquisition of the stated shares would take their holdings to 62 percent of the company and thus return the company back to Jamaican majority ownership which it had in the 1990s.
The offer, if successful, would result in NCBFG acquiring a controlling 62 percent interest in GHL following the 2016 acquisition of a 29.99 percent interest. Unless extended, the Offer period will close on January 12, 2018. Full acceptance of the Offer would result in a cash payment by NCBFG of the sum of up to approximately US$174,442,262 to the shareholders of GHL who accept the Offer.
Arthur Lok Jack Chairman of Guardian was one of the original sellers of Guardian shares to NCB and would have sold more at the time, but if NCB had acquired more then, it would have triggered the take over bid rule of the TTSE, requiring them to offer to buy the majority.
Guardian Group profit attributable to shareholders for the nine months ended September 2017 amounted to $254 million, a decline of $6 million compared to the corresponding period last year $260 million. NCB Group made profit of $19.1 billion for 2017, up from$14.45 billion in 2016.
The Offer will be conditional upon NCBFG acquiring control of GHL and obtaining regulatory and other approvals required to acquire the GHL Shares in Trinidad and Tobago, Jamaica as well as all other jurisdictions in which GHL and its subsidiaries are regulated.
According to President and Group CEO Patrick Hylton, “We believe that this partnership will not only support our strategy to expand regionally, but will provide numerous growth opportunities for both NCB and GHL. The successful completion of this Offer will be a significant milestone for our business and we anticipate the great potential that this presents.”
Last week NCB announced the acquisition of the majority stakes in Clarien Bank in Bermuda.

More fall for JSE main market – Tuesday

Trading on the Main Market of the Jamaica Stock Exchange closed on Tuesday with 23 securities changing hands, 9 advanced, 8 declined and 5 traded firm with 28,191,292 units valued at $755,323,320 compared to 4,115,612 units valued at just $48,667,070 on Monday.
The JSE All Jamaican Composite Index declined by 646.61 points to close at 314,205.01 and the JSE Index declined by 589.13 points to close at 286,276.31. The US dollar market index rose 6.40 points to 168.30 as 1 security traded with a gain in this market with a volume of 51,366 units valued at US$11,060.
Trading ended with an average of 1,225,708 units for an average of $32,840,144 in contrast to 178,940 units for an average of $2,115,960 on Monday. The average volume and value for the month to date amounts to 346,613 units valued at $5,296,046 and previously 284,400 units valued at $3,346,771. In contrast, October closed with average of 185,251 units valued at $16,528,582 for each security traded.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading shows 7 stocks ended with bids higher than their last selling prices and 2 with lower offers.
Major movements took place in NCB Financial Group with 5.4 million shares trading with the price dropping $3.50 and Supreme Ventures with 14 million units with its price rising 25 cents and JMMB Group 7.5% preference share traded 6,272,469 stock units. Barita Investments declined by $1, Caribbean Cement fell of $2.92, followed by Carreras with a fall of $1.18, while Sagicor Group rose $1.90.

JSE main market retreats again

Stock prices mostly fell for the second consecutive day in trading on the Main Market of the Jamaica Stock Exchange on Wednesday with 23 securities changing hands, 8 advanced, 10 declined and 3 traded firm
The main market with 8,130,384 units valued at $56,308,791 compared to 17,396,748 units valued at $218,089,928 on Tuesday. The US dollar market traded just 3 securities accounting for 15,319 units valued at just US$14,671 while the market index fell 12.29 points to close at 166.33.
The JSE All Jamaican Composite Index dived by 2,309.99 points to close at 317,033.63 and the JSE Index dropped 2,104.66 points to close at 288,853.50.
Trading ended with an average of 353,495 units for an average of $2,448,208 in contrast to 756,380 units for an average of $9,482,171 on Tuesday. The average volume and value for the month to date amounts to 307,065 units valued at $3,786,627 with an average value of 302,442 units valued at $3,919,890 previously. In contrast, October closed with average of 185,251 units valued at $16,528,582 for each security traded.
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 1 with a lower offer.
At the close of trading, Berger Paints fell $1.25, Grace Kennedy rose $1.50, PanJam Investment fell by $1, Sagicor Group rose $3.40 and Scotia Group rose $1.

JSE main market stocks tumble

All Jamaica Composite index broken out of channel but facing some headwinds before it moves away from the resistance zone.

Trading on the Main Market of the Jamaica Stock Exchange on Tuesday concluded with a fall in the All Jamaican Composite Index by 1,833.47 points to 319,343.62 and a dip in the JSE Index by 1,670.50 points to close at 290,958.16.
A total of 23 securities changed hands in the main market, 5 advanced, 11 declined and 7 traded firm with 17,396,748 units valued at $218,089,928 changing hands, compared to 13,891,915 units valued at $50,338,524 on Monday. The US dollar market traded just one security accounting for 1,369 units valued at just US$324 while the market index rose 12.28 points to 178.62.
Trading ended with an average of 756,380 units for an average of $9,482,171 in contrast to 631,451 units for an average of $2,288,115 on Monday. The average volume and value for the month to date amounts to 302,442 units valued at $3,919,890 previously 252,248 units with an average value of $3,304,830. In contrast, October closed with average of 1,185,251 units valued at $16,528,582 for each security traded.
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 4 with lower offers.
NCB Financial Group dropped $3, Sagicor Group traded with a loss of $2.90 while Berger Paints rose $1.25 while Supreme Ventures had the largest trade of 13.7 million units.

JSE main market inched higher

Trading on the Main Market of the Jamaica Stock Exchange ended on Friday with 22 securities changing hands, 6 advanced, 8 declined and 8 traded firm with 5,777,201 units valued at $107,680,730 compared to 2,566,192 units valued at $67,621,781 on Thursday.
The JSE All Jamaican Composite Index advanced by 102.47 points to close at 320,729.33, the JSE Index advanced by 93.36 points to close at 292,220.70. The US dollar Equity market lost 6.54 points to close at 169.09 as two securities traded resulting in 29,583 units valued at US$19,957.
Trading ended with an average of 262,600 units for an average of $4,894,579 in contrast to 128,310 units for an average of $3,381,089 on Thursday. The average volume and value for the month to date amounts to 207,395 units valued at $3,425.086 and previously, 199,991 units valued at $3,227,959. In contrast, October closed with average of 1,185,251 units at $16,528,582 for each security traded.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading shows 9 stocks ended with bids higher than their last selling prices and 3 with lower offers.
JMMB Group traded at a 52 weeks’ high and ended $1 up to $30.50 after trading as high as $30.70. Caribbean Cement finished with a loss of $1.99, NCB Financial rose $1.15 to $108, and Seprod climbed $1.99 to $30 while Jamaica Producers traded just over 4 million shares.

JSE main market post strong gains

Rising prices outnumbered falling stocks leading to a strong rise in the market indices in trading on the Main Market of the Jamaica Stock Exchange closed on Tuesday.
At the close the JSE All Jamaican Composite Index surged 1,972.76 points to close at 320,805.88 while the JSE Index jumped by 1,797.41 points to 292,290.45 as 23 securities changed hands in the main market leading to 11 advancing, 4 declining and 6 traded firm while the US dollar market saw 84,731 units trading with a value of US$48,586 with the index remaining unchanged as 4 securities traded.
Some of the contributors to the strong market gains are, Caribbean Cement that gained 99 cents, Grace Kennedy rising $1, JMMB Group with a gain of 86 cents, NCB Financial Group finishing $1.70 higher and Scotia Group that added 81 cents to its price.
Market activity ended with leading to 8,833,616 units valued at $92,295,814 changing hands compared to 894,417 units valued at $17,805,863 on Monday.
Trading ended with an average of 384,070 units for an average of $4,012,861 in contrast to 37,267 units for an average of $741,911 on Monday. The average volume and value for the month to date amounts to 202,819 units valued at $3,038,361 and previously, and average of 159,395 units valued at $2,804,887. In contrast, October closed with average of 1,185,251 units valued at $16,528,582 for each security traded.
IC bid-offer Indicator| At the end of trading, the Investor’s Choice bid-offer indicator reading for the main and US dollar market shows 7 stocks ended with bids higher than their last selling prices and 5 with lower offers.

Can NCB ignore compelling Guardian buy?

NCB Financial acquisition of 29.99 percent stake in Guardian Holdings cost $28 billion 2016. Make it the largest shareholder in an attempt to return it to majority ownership to which it previously belong.
If NCB were to increase their holdings to more than 50 percent it would strengthen their hands in greater integration of the group with the focus on cost reduction and income enhancement. Two areas would be, a possible merger of the two general insurance companies that would increase the muscle in the market and cut out lots of duplicated cost, the life insurance could also generate savings and increase potential income. An on the capital market side there is much to be gained with an increased financial strength that could become a real powerhouse in raising and providing capital within the region. But there at least one more compelling reason, Guardian’s profit for the six months to June is 83 Trinidad cents per share and is ahead of the 70 cents earned in 2016, earnings for 2018 should end up around TT$1.90 up from $1.61 last year. NCB currently trades in

Guardian Holdings closed at a 52 weeks’ high of $16.75 on TTSE..

Jamaica at a PE of 12 times 2017 earnings while Guardian earnings is below 7, any acquisition around the current price would be a huge steal for NCB and would be a big boost to the growth in 2018 earnings and by extension the stock price. That is far too attractive a deal for NCB to forego at this time. Raising the shareholder to 75 percent would create increased profits around J$2 billion and add about $12 to the stock price and that is without any group synergies.
At the time the acquisition, some 36 percent of the company was available for sale not including International Financial Corporation block which NCB acquired. Had they gone for the full amount, it would have triggered the takeover rule of the Trinidad and Tobago Stock Exchange and would have required the group to have much more funds available, to swallow a much larger amount. A year and half having elapsed since that acquisition NCB has amassed more of its own funds by way of retained earnings and lately, from a floatation of bonds on the local market that initially raised $18 billion, the equivalent of US$138 million in September and a further attempt to raise US$105 million at attractive interest rates.
The funds raised was said to be used for regional and local expansion and acquisitions by the group. Acquisition of more Guardian shares seems to most logical more, along with more JMMB Group shares.
market capital is TT$3,538,793,786, a 20 percent stake that would take NCB’s stake to just under 50 percent, could cost around US$105 million, an amount that is well below the amounts raised recently and with the amounts they went to the market for giving them the financial muscle to acquire an additional 45 percent at current prices, that could take the ownership to 75 percent.
The case of acquiring JMB shares is compelling NCB with 26.3 percent of the issued ordinary shares is by far the largest shareholder with next being JMMB ESOP with 9.6 percent but Trinidad’s Colonial Life Insurance with a block of 6.3 percent can no longer be seen as long term holder and these shares may well become available for sale which NCB maybe best suited to acquire. The reality is that the Duncan’s family no longer holds a commanding interest in the group and based on the top 10 listing may just be able to muster votes of about 23 percent.