Honey Bun in ICTOP10 as Purity jumps 24%

April 16, 2023 by

The Main Market of the Jamaica Stock Exchange recorded solid gains during the past week as the Junior Market declined but that did not show up in the ICTOP10 stocks performance as Junior Market stocks ended with gains and losses with the average gains outdoing declines while the Main Market ended with modest price changes in a week when Consolidated Bakeries (Purity) was the star performer with a 24 percent rise to $2.50.

Consolidated Bakeries

The Junior Market had one change in the TOP10 as Main Event rose 6 percent to $12.95 and moved out of the TOP10, allowing Honey Bun to return after falling out the previous week.
Other major price movements in this past week were a 4 percent rise for Everything Fresh to $1.46, a 17 percent fall to $2.15 for Lasco Distributors and 4 percent decline for Image Plus to $1.95. Trading in Image Plus never resulted in more gains during the week following the previous week’s healthy move as selling continued at the same pace as the week before while buyers seem to have pulled back.
In the Main Market, Key Insurance rose 5 percent to $3.65, while Sygnus Credit Investments fell 5 percent to $11.40 as Guardian Holdings, Berger Paints and JMMB Group declined by 4 percent to $475, $7.70 and $30.31 respectively.
Interest rates on Bank of Jamaica CDs dipped again at this past week’s auction with the average rate slipping to 8.41 percent from 8.49 percent, at the previous week’s auction, with BOJ quarantining $104 billion. At the same time the foreign exchange market enjoyed buoyant flows with more funds entering the market each day than the amount dealers sold.
Another fact worth noting is that the Junior Market has a long history, with the market starting to rise around a month before the release of quarterly results and declining shortly after results are released.
Honey Bun’s return to the TOP10 Junior Market list this past week should enjoy increased investors’ interest with an expected jump in revenues and profits for the first quarter with the Easter coming at the beginning of April versus the 17th of April last year as well as improvement of gross profit margin that slipped last year.
At the end of the week, the average PE for the JSE Main Market TOP 10 is 5.5 well below the market average of 13.5, while the Junior Market Top 10 PE sits at 5.7 compared with the market at 11.2. The differences are important indicators of the level of likely gains for ICTOP10 stocks. The Junior Market is projected to rise by 255 percent and the Main Market TOP10 an average of 276 percent, to May 2024, based on 2023 forecasted earnings.
The Junior Market has 11 stocks representing 23 percent of the market, with PEs from 15 to 28, averaging 20, well above the average of the market. The top half of the market has an average PE of 16, suggesting that this may be a logical value for junior market stocks currently.
The 16  Main Market stocks with the highest value are priced at a PE of 15 to 115, with an average of 31 and 20 excluding the highest PE stocks and 20 for the top half excluding the stocks with the highest valuation.
The above average shows the extent of potential gains for the TOP 10 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 are likely to 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 and result 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.

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Nice gains for ICTOP10 stocks, Purity returns

April 9, 2023 by

The Main and Junior Markets did not maintain the sharp bounce of the previous week, but most ICTOP10 Junior Market stocks ended with gains. In contrast, the Main Market ended with mostly modest losses, with 138 Student Living rising 5 percent to $5.30 and JMMB Group declining by 5 percent to $31.49, all other changes in the Main Market were two percent or less.

Dr Karlene McDonnough – Chairman of Image Consultants Ltd. The stock came in for increased demand during the week ahead of the release of full-year results.

The Junior Market had one change in its TOP10 list as Iron Rock Insurance and Image Plus climbed 13 percent to $2.27 and $2.03, respectively, while Main Event and Honey Bun rose 5 percent to $12.26 and $6.75, respectively, with the only sizable decline being a 9 percent fall for Tropical Battery to $1.90.
Image Plus never benefitted from any serious IPO bounce seems to be finally finding buying interest and closed the past week with 159,904 shares on the bid at $2.02, 160,746 at $2 and just over 800,000 between $1.90 and $1.95, with 25,987 stocks on offer at $2.03, 81,709 at $2.05 with one big offer of 1.72 million units at S2.50 with smaller offers before the this. There has been healthy trading in the stock recently, with trading of 824,526 units on Thursday. Trading on Wednesday saw 1,153,255 shares changing hands in the stock, with 910,000 units on Tuesday and 1.75 million shares on Monday, which seems to have cleared out a great deal of overhang in the market.
Update on interest rate developments. A number of developments taking place in the economy are worth watching. Following last week’s $35 billion Bank of Jamaica CD auction that saw the average rate coming in at 8.49 percent, this week’s auction saw an offer of $34 billion, with the average rate remaining the same as the previous week with fewer funds chasing the offered amount. Another positive development is the average inflation rate running at 45 percent less than the same time last year and averaging 2.4 percent per annum since November last year. Foreign exchange inflows have been strong, with the NIR growing at $66 million in February and 220 million in March, putting it at a record end of month level as initial data suggest that tourism arrivals and foreign exchange generated by that industry exceed the similar period in 2019, the last year without the impact of covid-19 negatively affecting the sector. On top of those positive developments, corporate profits are expected to enjoy a good bounce for the majority of companies for the first quarter.
The Junior Market has a long term pattern, with the market starting to rise around a month before quarterly results are due and declining shortly after results are released. This is a pattern worth noting that can be built into investment decisions to improve returns.

Consolidated Bakeries Miss Birdie Easter bun. The stock is back in the ICTOP10

Dropping from the TOP10 Junior Market list this past week was Honey Bun, but investors should expect a big jump in revenues and profits for the first quarter, with the Easter coming at the beginning of April versus the 17th of April last year, as well as an improvement of gross profit margin that slipped up last year.
Returning to the TOP10 is Consolidated Bakeries in the number 3 spot. The company is projected to report a solid first quarter profit, with the Easter holidays coming at the start of April compared with April 17 last year and ensuring that mostly all Easter bun sales will be reported in the March quarter unlike 2022. The company reported a profit in 2022 a big improvement over a loss in the previous three years. ICInsider.com projects earnings of 40 cents for 2023 and 75 cents for 2024 with the company benefitting from a full recovery of the local economy and increase efficiency and reduction in borrowings. At the end of the week, the average PE for the JSE
Main Market TOP 10 is 5.6, well below the market average of 13.5, while the Junior Market Top 10 PE sits at 5.7 compared with the market at 11.1. The differences are important indicators of the likely gains for ICTOP10 stocks. The Junior Market is projected to rise by 256 percent and the Main Market TOP10, an average of 271 percent, to May 2024, based on 2023 forecasted earnings.
The Junior Market has 10 stocks representing 21 percent of the market, with PEs from 15 to 29, averaging 19, well above the market’s average. The top half of the market has an average PE of 15, suggesting this may be a logical value for junior market stocks.
The 16 stocks with the highest value in the Main Market stocks are priced at a PE of 15 to 115, with an average of 30 and 19 excluding the highest PE stocks and 19 for the top half excluding the stocks with the highest valuation.
The above average shows the extent of potential gains for the TOP 10 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.

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ICTOP10 rides big weekly JSE rally

April 3, 2023 by

The JSE Main market surged sharply in the past week.

While the Main and Junior Markets rebounded sharply during last week, ICTOP10 stocks ended with varying movements, with gains and losses in both markets hitting 16 percent. It was an interesting week in which the main market gained over 18,000 points for the week with all days closing with gains including the Friday of the previous week, but it sits at a resistance level and is a signal worth watching.  
The Junior Market put on 200 points since Thursday, March 23 and had one minor negative trading day during the period, however, the last day accounted for nearly half of the above gains.
While Bank of Jamaica held their overnight rates at 7 percent, their CD rate that fell 16 percent in the previous week to an average of 8.85 percent from over 10 percent where it stood for several months, BOJ offered a huge $35 billion this past week, but the average rate fell to 8.49 percent after $70 billion chased the amount offered. Importantly, the central bank cut the stock of CDS it holds from a peak of $109.5 billion on March 3, but at the latest auction, it amounted to $88.85 billion, marginally up from $82 billion on the 17th.
At the end of the past week, in the Junior Market TOP10 four stocks gained and five declined. KLE Group jumped 16 percent to $1.69 and Tropical Battery rose 7 percent to close at $2.08. General Accident dropped 16 percent to $5 and Everything Fresh fell 6 percent to close at $1.45.
The Main Market TOP10 JMMB Group climbed 15 percent to $33.25, Jamaica Broilers gained 12 percent to $37.10, Caribbean Producers popped 7 percent to $9.70 and NCB Financial with a rise of 6 percent to $75. Berger Paints fell 10 percent to $8.20 and 138 Student Living with a fall of 6 percent to $5.05.
The Junior Market has a long term pattern, with the market starting to rise around a month before quarterly results are due and declining shortly after results are released. This is a pattern worth noting that can be built into investment decisions that can improve returns.
At the end of the week, the average PE for the JSE Main Market TOP 10 is 5.6, well below the market average of 14.2, while the Junior Market Top 10 PE sits at 5.8 compared with the market at 11.4. The differences are important indicators of the level of likely gains for ICTOP10 stocks. The Junior Market is projected to rise by 248 percent and the Main MarketTOP10 by an average of 267 percent, by May 2024, based on 2023 forecasted earnings.
The Junior Market has 11 stocks representing 23 percent of the market, with PEs from 15 to 28, averaging 20.4, well above the average of the market. The top half of the market has an average PE of 16, suggesting that this may be a logical value for junior market stocks currently.
The Main Market 19 highest valued stocks are priced at a PE of 15 to 115, with an average of 29 and 21 excluding the most valued stocks and 20.5 for the top half excluding the stocks with the highest valuation.
The above average shows the extent of potential gains for the TOP 10 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 are likely to 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 and result 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.

 

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Key Insurance highest ICTOP10 jumps 37%

March 26, 2023 by

Stocks dropped to their lowest levels this past week after falling even lower than they did to close of the previous week as investors continue to shun the market, but the time is not far off that Bank of Jamaica will begin lowering interest rates and fuel a market resurgence as they sent the clearest signal that interest rates have not only peaked but will be headed downwards this past week.

The first signs of an easing of rate came this past week with BOJ CDs rates plunging 16 percent to an average of 8.85 percent from over 10 percent where it stood for several months. Importantly, the central bank cut the stock of CDS it holds from a peak of $109.5 billion on March 3, down to $82 billion at the latest auction, far less than from mid-January to the end of February, as more than $58 billion chasing after the $18 billion that was offered last week. While this happened the foreign exchange market looks very liquid with the rate falling under $152 to one US dollar from $155 earlier in February.
Performance in the past week for the Junior Market TOP10 saw only two stocks rising and seven falling, the majority of the declining stocks registering fell by 3 percent or less. General Accident jumped 20 percent to $5.98, but the bids are not there at the close, to support the price, but selling has abated for this stock currently. Everything Fresh rose 9 percent to close at $1.55 and actually traded at $1.65 during the week. Iron Rock Insurance fell 13 percent to $2 and Caribbean Assurance Brokers lost 6 percent to $1.90.
The Main Market TOP10 saw the highest gaining stock rising just 34 percent, after Key Insurance jumped to $3.50 and was followed by 138 Student Living with an 8 percent rise to $5.40, but Caribbean Producers dropped 8 percent to $9.07. All other movements were 3 percent or less.
The Junior Market has a long term pattern, with the market starting to rise around a month before quarterly results are due and declining shortly after results are released. This is a pattern worth noting that can be built into investment decisions that can improve returns.
At the end of the week, the average PE for the JSE Main Market TOP 10 is 5.5, well below the market average of 13.2, while the Junior Market Top 10 PE sits at 5.9 compared with the market at 10.6. The differences are important indicators of the level of likely gains for ICTOP10 stocks. The Junior Market is projected to rise by 248 percent and the Main Market TOP10 an average of 274 percent, to May 2024, based on 2023 forecasted earnings.
The Junior Market has 9 stocks representing 19 percent of the market, with PEs from 15 to 24, averaging 19, well above the average of the market. The top half of the market has an average PE of 15, suggesting that this may be a logical value for junior market stocks currently.
The Main Market 16 most valued stocks are priced at a PE of 15 to 100, with an average of 29 and 19 excluding the highest valued stocks and 18 for the top half excluding the stocks with the highest valuation. The above average shows the extent of potential gains for the TOP 10 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 are likely to 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 and result 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.

Filed Under: Buy Rated, Stock Market, Stocks to watch Tagged With: , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

KLE Group is Main Event in ICTOP10

March 20, 2023 by

Stocks continued to be battered in the past week sending the Junior Market back to January 2022 levels and the Main Market declined for a second week and as far back as September 2018 levels, but some stocks bucked the trend and posted gains.

Main Event

Earnings season delivered a few new results during the past week, with Main Event posting positive profit gains for the January first quarter and seeming poised to earn $1.80 for the year. Fosrich released full year results to December, with profit jumping to $325 million from $199 million in 2021 as revenues climbed a solid 43.4 percent, Dolla Financial posted increased profit of 18 cents per share and should go on to earn 40 cents in 2023, but it is not in ICInsider.com TOP10 reporting solid results that augur well for full year’s profit. Limners and Bards delivered disappointing first quarter results of a mere $7 million, down from $66 million in 2022, as revenues dropped sharply from $443 million to $248 million. Lumber Depot suffered a decline in revenues for the January quarter, with a decline in profit and Blue Power reported an increase in revenues year over year, with a profit rising for their third quarter to January, with profit slipping for the nine months.
Performance in the past week for the Junior Market TOP10 saw four stocks rising and three falling. AMG Packaging gained 16 percent to $2.90, followed by Everything Fresh with a 5 percent gain, Lasco Distributors gained 4 percent to $2.74. Tropical Battery lost 10 percent of its value to close at $2.02 and Image Plus lost 4 percent to end at $1.85.
Stationery and Office Supplies is said to continue to enjoy buoyant business into 2023, rose 3 percent to $15 and dropped out of the Junior Market ICTOP10 along with AMG Packaging as Main Event and KLE Group replaced those that fell out, with the former posting strong first quarter results that point to earnings of $1.80 for the year. KLE is now in, based on the fall in the stock price, but investment in the stock is not without above average risk. They are yet to release 2022 earnings, but they should benefit from pick up in business in their associated restaurant business in which they hold a 49 percent interest, with exposure in Montego Bay that will see added inflows from the considerable pick up in tourist patronage and should have income generated from managing the Bessa apartments in Oracabessa on the north coast of Jamaica.
The Main Market TOP10 saw the highest gaining stock rising just 3 percent while Jamaica Broilers dropped 12 percent to $33.50’ following some large trades in the week, Guardian Holdings followed with a fall of 6 percent to close at $480 and 138 Student Living being down by 4 percent to $5.01.
There have been no changes in the listing in the Main Market ICTOP10 this past week.
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 13.3, while the Junior Market Top 10 PE sits at 5.9 compared with the market at 11.3. The differences are important indicators of the likely gains for ICTOP10 stocks. The Junior Market is projected to rise by 245 percent and the Main Market TOP10 by an average of 282 percent, to May 2024, based on 2023 forecasted earnings.
The Junior Market has 12 stocks representing 25 percent of the market, with PEs from 15 to 24, averaging 18.3, well above the market’s average. The top half of the market has an average PE of 15.
The Main Market 18 highest valued stocks are priced at a PE of 18 to 115, with an average of 30 and 21 excluding stocks with the highest valuations and 20 for the top half excluding the stocks with the highest valuation. The above average shows the extent of potential gains for the TOP 10 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.

Filed Under: Buy Rated, Stock Market, Stocks to watch Tagged With: , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

Everything & Guardian head ICTOP10

March 12, 2023 by

Everything Fresh and Guardian Holdings continue to head the ICInsider.com TOP10 in a week when the Main Market fell 2.7 percent and the Junior Market dropped a hefty 7.8 percent and reversed all the gains of the previous week, but the Investors Choice bid-offer Indicator is flashing positive signals for both markets on Monday.
Guardian Holdings has a commanding lead over its next rival by almost 100 points, but Everything Fresh likely gain of 344 percent is just above Caribbean Assurance at 333 percent, but the latter is currently far more appealing, with the stock selling at a PE of a mere 7 times 2022 earnings and 4.6 times 2023. Everything Fresh PE based on 2022 earnings is at a much higher 17 and 4.5 based on projected 2023 earnings.
Earnings season had two companies in ICInsider.com TOP10 reporting very strong results that augur well for a full year’s profit.

Caribbean Assurance Brokers is selling at a PE of just 7 based on historical earnings.

Scotia Group reported a net income of $3.4 billion for the quarter that ended January 2023, an increase of $2.2 billion or 173 percent over the prior year period as loans the primary driver of profits increased a solid 18.8 percent to $237 billion while deposits grew only 7.7 percent to $4.05 billion and resulted in net interest income surging $2.6 billion as interest expenses actually declined. These results suggest  ICInsider.com forecast for $5 per share may be a bit light with solid prospects that earnings of $5.50 seem possible. It noted that overall comprehensive profit shows a loss of $1 billion after accounting for pension obligations of $9.5 billion and other items of gains.
Jamaica Broilers continues to churn out strong growth in profits with their nine months results more than double that of the prior year while the January quarter is up 27 percent to $1.5 billion as revenues climbed a solid 20 percent after finance cost nearly doubled. With the tourism industry back to normal the company should get a further boost for the rest of 2023. ICInsider.com forecast for $6 per share for the current fiscal year from continuing operations seem well within reach and could be exceeded making it a solid buy for the long haul.

Scotia Group had a significant increase in profits for the January 2023 quarter.

Performance in the past week was mixed for the Junior Market TOP10 but was far better than the near 8 percent fall by that market, with only three stocks rising of which two rose by 2 percent or less. Iron Rock Insurance gained 15 percent this past week to $2.30 after falling 13 percent the previous week. Lasco Distributors fell 6 percent to $2.64, followed by AMG Packaging and Stationery and Office Supplies which fell by 3 percent to $2.51 and $14.50, respectively.
The Main Market TOP10 performed worse than the overall market with only two stocks gaining and six declining. Jamaica Broilers rose 6 percent to $38 as investors warmed to the stock following release of outstanding results, with the price having a far way to run, while JMMB Group a clear winner for the long term, put on just 2 percent to close at $31.01. Key Insurance fell 7 percent to $2.61 followed by a 5 percent for NCB Financial and 138 Student Living to $72 and $5.20 respectively.
There are no new additions in either market to the ICTOP10 this past week.
At the end of the week, the average PE for the JSE Main Market TOP 10 is 5.5, well below the market average of 13.3, while the Junior Market Top 10 PE sits at 6.1 compared with the market at 11.3. The differences are important indicators of the level of likely gains of ICTOP10 stocks. The Junior Market is projected to rise by 238 percent and the Main Market TOP10 by an average of 274 percent to May 2024, based on 2023 forecasted earnings.
The Junior Market has 11 stocks representing 23 percent of the market, with PEs from 15 to 25, averaging 19.7, well above the market’s average. The top half of the market has an average PE of 16.
The Main Market 16 highest valued stocks are priced at a PE of 15 to 98, with an average of 30 and 22 excluding the highest valued stocks and 20 for the top half excluding the stocks with the highest valuation.
The above average shows the extent of potential gains for the TOP 10 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 and result 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.

Filed Under: Buy Rated, Stock Market, Stocks to watch Tagged With: , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

3 new ICTOP10 stocks after week’s gains

March 5, 2023 by

The Main Market gained 1.3 percent and the Junior Market 2.4 percent over the previous week, the first sign that stocks may be coming back to life, following the end of earning season with a mixed bag of results and the sounding of prospects for a better period ahead, with cost pressures that existed last year in stockpiling supplies to meet demand that squeezed margins have started to recede, with the promise of higher profit margins ahead.

Everything Fresh tops ICTOP10

The period saw many companies reporting solid gains in profit that investors are yet to award with better prices than the results demand, which is not expected to last for long as supplies of many stocks have been declining in recent weeks.
ICTOP10 has three new additions to the Junior Market TOP10 while the Main Market remains steady.
The week closed with rising stocks dominating the Junior Market TOP10. Paramount Trading fell 9 percent in the prior week, led rising stocks this past week, with a gain of 18 percent to $2.35, followed by Main Event, put on 15 percent to land at a new high of $12.39, Lasco Distributors and Lasco Manufacturing rose 8 percent to $2.81 and $4.30, respectively. Iron Rock Insurance fell 13 percent to $2.08 and Tropical Battery dipped 4 percent to $2.20.
Six stocks rose in the Main Market TOP10, with 138 Student Living rising 10 percent to $5.50, the price of Jamaica Broilers rose 9 percent to $36 as investors warmed to the stock following release of outstanding second quarter numbers and the price having a long way to run. Caribbean Producers, that is undervalued, rose 6 percent to $10 as selling pressure eased somewhat.
Price changes resulted in Paramount Trading, Main Event and Lasco Manufacturing exiting the Junior Market TOP10 and replaced by AMG Packaging, Everything Fresh and Stationery and Office Supplies.
AMG Packaging enjoyed improved profit margin in the November quarter compared with that in 2021, even as sales fell slightly in the latest quarter to November, which augurs well for increased profit in the current year, with revenues projected to rise in the year with more business opportunities as the economy continues to grow at a healthy pace. Everything Fresh and Stationery and Office Supplies (SOS) earnings reflect that for the current year. Everything Fresh now heads the Junior market TOP10, having reported profit for an entire year in 2022 for the first time since they released a depressed $16 million profit in 2018. Profit came in at $48 million before tax for 2022, a modest change from $47 million reported for the nine months to September after finance costs rose 43.5 percent in the December quarter over the nine months to September. With 2023 setting up to be the strongest tourist season since 2019, the company is set to see a big jump in business from that sector and profit in 2023, that should see the company earned 30 cents per share, that is why it is in ICTOP10. SOS posted record profits for 2022 with a 169 percent increase before tax from a 55 percent jump in revenues. Of note are a 35 percent increase in fourth quarter revenues and a deal struck with a company in Trinidad to cross sell products that should add to revenues in 2023 and push earnings to $2 per share for the year. With improving profits and shrinking supplies outside of the TOP 10 shareholders, who control 91 percent of the issued shares, the stock is setting up for a stock split that cannot be far off and, when given, will catapult the stock price upwards.
At the end of the week, the average PE for the JSE Main Market TOP 10 is 5.5, well below the market average of 13.9, while the Junior Market Top 10 PE sits at 6.1 compared with the market at 11.8. The differences are important indicators of the level of the undervaluation of the ICTOP10 stocks. The Junior Market is projected to rise by 240 percent and the Main Market TOP10 by an average of 284 percent to May 2024, now that TOP10 stocks earnings are based on 2023 profits.
The Junior Market has 13 stocks representing 27 percent of the market, with PEs from 15 to 26, averaging 19.5, well above the market’s average. 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 12 highest valued stocks priced at a PE of 15 to 115, 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.

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Allen and Bailey buy 30m One on One shares

February 21, 2023 by

Soho Investments and Jorden Investments acquired 15 million shares each in One on One on Monday, February 13, to increase their equity holding in the company, the company announced.
The companies, owned by Ricardo Allen and John Bailey, respectively, bring their ownership in the 2022 listed Junior Market company to just under 24 percent and under 9 percent, respectively, in a move that is a vote of confidence in the future growth of the company.
Allen said, “Obviously, as the leader of the organization, I see the tremendous value that the team has been able to create here. We would also have line of sight as it relates to the growth journey we are about to embark on. With that being said, we believe that the current share price is low, and we will take the opportunity to purchase shares on the market as they become available at this price.
“We have some excellent growth initiatives ahead, and we look forward to executing on these and sharing them with our valued stakeholders when the time comes”.

Ricardo Allen CEO of One to One

On a recently hosted Earnings Call discussing the company’s first quarter results, Allen indicated that one of the company’s key strategic focus areas for the remainder of this year would be developing its content agency. To this end, the team has already acquired 4,000 square feet of space where it will look to build out studios to host instruction sessions and otherwise produce content to support its other product offerings, such as its Classroom in a Box as well as its Award-Winning Learning Management System.
In an interview with Allen, he indicated to ICInsider.com the content studio will provide abundant opportunities for creating content in educational services for local and global consumption.
Allen also indicated that staff cost rose in the first quarter of the current year ahead of revenue growth but that the additional revenues will start to flow in the company’s second half year numbers that are expected to flow through existing partnerships with agencies such as the Ministry of Education locally and the Department of Education in the Bahamas, as well as international alliances, such as that with Community Services Foundation.
The first quarter results show revenues almost doubling to $83 million, compared with $45 million in 2021, with profit rising to $12 million before tax from a loss of $1.8 million in 2021, following a sharp jump in Administrative and marketing cost to $54 million from $32 million in 2021.

Filed Under: Company News, Company Results, General Business News Tagged With: , , , , , ,

Trading jumps on the Jamaica Stock Exchange

February 13, 2023 by

Trading picked up sharply on the Jamaica Stock Exchange on Monday, but prices fell with all three markets suffering moderate slippage at the close after recording healthy gains in the morning session.
The volume of stocks traded jumped sharply over that on Friday, as Everything Fresh traded 29.2 million shares and One on One Education traded 31.2 million shares resulting in a big surge in the overall volume for the day of 84,781,563 shares changing hands in all three markets, up from 18,750,465 units on Friday, valued at $356.5 million, up sharply from $111.54 million on the previous day. Trading on the JSE USD market resulted in investors exchanging the shares traded for US$6,710 versus US$10,720 on Friday.
At the close, the Combined Market Index fell 1,080.76 points to 348,391.93 the All Jamaican Composite Index dropped 1,641.15 points to end at 379,404.43, the JSE Main Index lost 1,138.54 points to end at 335,146.88, the Junior Market slipped 2.17 points to end at 3,894.48 and the JSE US dollar market dipped 2.11 points to end at 230.52.
The market’s PE ratio ended at 20.2 based on 2021-22 earnings and 12.9 times those for 2022-23 at the close of trading.
Investors need pertinent information to successfully navigate many investment options in the local 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 investment decisions by 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 put in 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 ICInsider.com PE Ratio chart covers all ordinary shares on the Jamaica Stock Exchange. It shows companies grouped on an industry basis, allowing easy comparisons between the same sector companies and the overall market.
The net asset value of each company is reported as a guide to assess the value of stocks based on this measure quickly. The chart also shows daily changes in stock prices and the percentage year to date price movement based on the last traded prices. Dividends payable and yields for each company are shown in the Main and Junior Markets’ daily report charts that show the closing volume for the bids and offers.
The EPS & PE ratios are based on 2021 and 2022 actual or projected earnings, excluding major one off items. The PE Ratio is the most popular measure used to determine the value of stocks.

Filed Under: JSE Combined, Stock Market Tagged With: , , , , , , , , , , , ,

13 Junior Market stocks to watch in 2023

February 4, 2023 by

To make the 2023 ICTOP15, projected gains have to exceed 280 percent over the next 18 months at a projected PE of 22.5 times earnings. That level of growth is what the lowest on the list, Access Financial is projected to deliver over the period.
So great are the prospects of the Junior Market that IC Insider.com thought it important to highlight these additional companies for investors to see the great potential to make money over the next 18 months. This publication has never before put out such a list to start the year, in addition to the ICTOP15.
While the IC TOP15 2023 listings reflect 15 companies that show the greatest potential to be the top performers up to May 2024, a number of companies have the potential to do exceedingly well over the period but are likely to underperform those in the ICTOP15, even then, the future is not assured and some in the watch list could outperform projections and end in the top performers for the period.
The watch list shows that investors do not have to hit home runs to make decent gains in the stock market, but observation in the local market suggests that many persons may not have the patience to build gains over time.
These may or may not be the best companies in the market based on management, products or services and financial health, but they are undervalued and could deliver above average gains as well as pay attractive dividends in the 2023 to 2024 period.
The market has demonstrated that the ability to increase profits is the most important factor that will drive stock prices and is the primary area for investors to focus on going forward.
CAC2000 Projection EPS $1.
The company has the potential to do exceedingly well, especially with an upsurge in the construction of homes and hotels. But it is not without risk and disappointment from quarter to quarter as projects take time to complete, resulting in jerkiness in earnings. This is definitely a stock to consider from a longer time horizon and not one that can be relied on to deliver instant gains, but it could surprise.
Cargo Handlers
This company is not one that will be on every investor’s list for 2023, don’t let that dissuade you from taking a closer look. One of the smaller Junior Market companies and is highly profitable and holds over $500 million in cash funds and with add to it yearly.  The company serves one of the fastest growing regions of Jamaica with the continued expansion of the tourist sector that fuels above average economic activities and the BPO sector that lead to increased imports through the Montego Bay port where its operation is centred. Last year’s earnings per share were 77 cents and ICInsider.com is forecasting $1.10 for the current year, that should be enough to push the price towards $20 or more.
An important factor to consider is the cash that they hold which is available for investment in other entities that could add to improved profits going forward. By the way, don’t ignore the dividends they pay.
Dollar Financial came to the Junior Market in June last year and is now accredited by Bank of Jamaica to operate as a micro financial institution. For the nine months to September 2022, profit before tax amounted to $201 million, 257 percent higher than in 2021. Profit before tax for the quarter ending September 2022 increased a solid 214 percent to $70 million, an indication of what could be coming down the road.
The increase in profits was fueled by loans receivable of $1.2 billion to September 2022, an increase of $650 million or 125 percent over the  September 2021 position. Up to September, secured loans represented 72 percent of total loans and unsecured 28 percent.
The company recently raised $1.17 billion in debt financing and expanded the resources available for lending. These funds plus additional cash from profit to be generated provide more than adequate fuel for strong loan expansion that will result in continued above average profit growth. The company plans to use some of the funds raised to expand to the Bahamas and the Eastern Caribbean and capitalize Ultra Financier Limited, their asset based lender. The company could turn out to be exceptionally profitable if the resources are managed well to prevent heavy loan loss provisioning that could eat away at profits. ICInsider.com projects earnings of 35 cents per share for 2023 and that should be good enough to send the stock flying with gains of more than 200 percent.
Express Catering EPS is projected at 65 cents for 2023/4
The company started to benefit from the rebound in tourism but importantly the first half of the 2022 calendar year saw a decline in visitor arrivals compare to 2019, with the numbers for 2023 set to show a major increase over 2022first quarter numbers. The first quarter should be up over 50 plus percent compared with that of 2022. That will have a major impact on the revenues, with its entire operation within the Sangster International Airport. It is worth noting also that the company will have additional restaurants within the airport during the new fiscal year and this is going to add to revenues and profitability for the company.
With the stock price hovering around $5 per share this stock is selling slightly less than eight times earnings and shows the potential to do even better than the revenues and the earnings per share projections. With many Junior Market companies selling at PE ratios around 20 one should expect the stock to deliver a 200 percent rise in value over the next 18 months or so.
Fontana stock could gain 150 percent for the period. looking back, for the first quarter to September, revenues rose a healthy 26 percent and profit jumped 43 percent to $87 million. The projection is for revenues to continue to grow around the 26 percent level into 2023, with profit to rise to 80 cents per share for the year and $1.50 in the 2024 fiscal year ending June. With the stock priced around $9 it is nicely positioned for a bounce to provide an excellent return over the next year and a half.
The company is adding a new store in Portmore that should come into operation during the first half of 2023 and add revenues and profits to the business, but this may not be significant until the 2024 fiscal year. Expected growth in the local economy and a big bounce in tourism traffic will have a positive impact on stores in the western end of the country and deliver increased revenues and increased profit as a result. For the year to June 2022, profit was up 12 percent to $415 million from a 21 percent rise in revenues to $4.7 billion.
Image Plus Consultants – EPS 30 cents 2023 and $0.35 for 2023-4
The Image Plus stock failed to sparkle on listing in January, rising just 10 percent by the close of its first day on the market in heavy trading of nearly 12.4 million shares, the second heaviest traded Junior Market stock on opening, following an IPO. The price has now fallen below the issue price providing a good entry point for investors but has since bounced just above $2 with the release of nine months’ results to November. (See articles on analyzing the IPO and the nine months’ results.)
Jamaican Teas – earnings could hit 30 cents per share for the current fiscal year. Some input costs have declined following shipping facilities normalizing, resulting in lower shipping costs as well a reduction in some raw material prices worldwide. The forecast includes a sizable contribution from QWI Investments and a contribution from the real estate development that should see sales of its current development being concluded in the current fiscal year.
The group is expanding the product range for the local and export markets which will add to revenues and profits going forward.
The stock has seen increased buying from individual and institutional investors which is an excellent sign as it lends solid support for trading.

Knutsford Express

Knutsford Express – projected EPS of $1 and $1.40 for 2024.
The company suffered, in a meaningful way, from lower revenues when business activities were severely curtailed with the advent of the Covid-19 pandemic in Jamaica which resulted in major disruption in the economy. In the latest fiscal year to May, revenues were back to pre-pandemic levels in dollar terms but profits lagged as increased costs grew faster than revenues, resulting in the 2022 full year results being 38 percent of 2019 but more than twice 2020.
For the August quarter, revenues rose 78 percent to $415 million and profit jumped from $9 million to $84 million. For the half year to November, revenues rose to $813 million from $473 million in 2021 with profit surging from $13 million after tax to $143 million. Third quarter profit rose from just $2 post-tax to $59 million. The Drax Hall Business Centre is contributing fully to profit with all available space occupied with several tenants already open for business and the company looking to generate income in the order of $100 million a year from the complex.
The company is benefiting from the upsurge in visitor arrivals both directly and indirectly from persons working in the industry.

Main Event returns to IC TOP 10.

Main Event – EPS is projected at $1.10 for 2023 
There is the potential for the stock price to gain 180 percent over the next 18 months. Profits for the nine months last year jumped 147 percent to $243 million over 2021 as revenues rose from $501 million to just over $1 billion dollars representing 85 percent increase over the previous year.  Revenues for the September quarter rose 147 percent to $602 million with profits for the quarter jumping a solid 332 percent to $104 million as profits rose by $95 million over the previous year, suggesting that the results of 2022 will be outstanding and that could carry over well into 2023.
What is worth noting is that revenues for the first quarter were just $203 million and for the April quarter $290 million, well below third quarter numbers. By contrast, revenues were $458 million in the first quarter of 2019 and $438 million in the second quarter, well ahead of those for the 2022 periods, this has a lot of significance for revenue growth in the first half of the 2023 year. The data show that there should be a significant pick up in revenues and profitability in the corresponding 2023 period and a major uptick in revenues for the year and profits. There is a bit of seasonality in earnings and this could have implications in 2023. The final results for 2022 will provide good guidance on this.
The lesson to be drawn from the numbers for the first three quarters of the year is that profit for 2023 will be up substantially up on the ultimate results for 2022. There is a level of uncertainty along with various developments in the local economy that makes it challenging to project with certainty the level of business that Main Event will undertake, this is the major reason why the stock is placed on the watch list. The final numbers could impact the stock price significantly.
Of note, the third quarter revenues are the highest record in the company’s history in the quarter. The company indicates that the increased business was due to added activity in its core business. The entertainment industry has seen a strong return to outdoor events and lifestyle experiences after a two year break.

Medical Disposables EPS is projected at 40 cents for fiscal 2023 and 70 cents for 2024
This company is not one to take at face value as they quietly build the infrastructure on which to deliver increased business going forward. The company is focusing on laying the foundation for growth in consumer products as increased business opportunities in the medical area slow. The dental area that is operated by the newly formed subsidiary has room for expansion outside of the western region and should be able to ride on the parent company’s infrastructure that currently exists in the next year or two.
The company in the meantime has increased expenditure to attract and keep talent within its employ to grow business, this development resulted in increased costs in the current fiscal year and negatively affected growth in profits for the fiscal year to date.
There is the possibility that more shares could be available in the market over the next year or so.
One on One Educational EPS is projected at 20 cents
The stock raced out the blocks on the fifth day of listing in the latter part of last year to hit $2.50 but the price has fallen to a low of $1.10 in December, with investors concerned that they may have lost a major client and the negative impact that may have on profit. The prospectus stated that in August 2021, 63 percent of the Company’s revenue came through Business to Business contracts and 37 percent through the Company’s end user consumers’ business line. Neither the 2022 audited accounts nor the first quarter results show any fall out of business, in fact, revenues almost doubled in the quarter with profit rising to $12 million before tax from a loss of $1.8 million in 2021. The price could be considered appropriate based on results released so far but as more results become available, the current price may appear to be a gift.
Funds raised in the public issue in 2022 net of loan repayment were earmarked for the development of technological infrastructure for expansion. Regardless, the major reasons to invest in this company is not its short-term fortunes or misfortunes but the major potential its operations have to deliver above average growth within Jamaica and overseas.
Spur Tree Spices EPS is projected at 40 cents.
The company recorded a 9.4 percent growth in revenues to $672M for the nine-months ended September 2022, from $614 million in 2021. Gross Margin increased from 31 percent in 2021 to 35.4 percent in 2022.
For the September quarter revenues slipped to $233 million from $247 but improved profit margin resulted in a gross profit of $75 million versus $73 million in the prior year. Profit before Taxation fell to $30 million in the quarter from $33 million in 2021, but climbed 30 percent to $119 million for the year to September compared with $91 million in 2021 and was just shy of the $124 million for the full year in 2021.
The company implemented investment projects to expand the Exotic Products factory infrastructure to double production capacity, purchase of building in Port Morant to establish a production facility and upgraded the Spur Tree Spices production capacity.
They also advanced $100 million to purchase a controlling interest in Canco, an ackee canning company, and if combined with Exotic Products could result in a major jump in production and improved efficiency. They also appointed Massy Distributions agents for regional distribution.
This company has a lot of promise but the valuation placed on the stock ran ahead of results as such improved results in 2023 are unlikely to be reflected fully in the stock price and provide above average growth for the stock but it could be good enough to deliver a reasonable gain that investors would be normally pleased with even if it does not put it in the top ranking of stocks. Additionally, it has growth potential going beyond 2023 that could help deliver above average long term growth.

Stationery & Office Supplies recording record 2022 profits.

Stationary and Office Supplies should deliver gains of 250 percent for the period. The company has done exceptionally well in 2022 and is one of the top performing stocks for that year, gaining 140 percent as a result of very strong profit performance during the year that came from an incredible 60 percent increase in revenues that should end close to $1.8 billion for the year and $2.3 billion for 2023. The company generated a profit of $250 million for the nine months to September that should reach $360 million for the full year and just over $550 million in 2023.
ICInsider.com does not expect the performance to be at the same level in 2023 but sees continued attractive growth in earnings that should put it at about $2.20 per share, up from around $1.35 per share in 2022.
The business continues to increase from local and overseas demand. Information is that a deal was struck with a Trinidad company to sell their furniture in that market in addition the possibility exists that they could be getting into other Caribbean countries to add to the organic growth of the business. There is the possibility for acquisitions of small businesses during the year that could benefit from synergies within the company and deliver above average returns from such investments. Investors should not ignore the possibility of a stock split that could provide additional spice to make the performance of the stock an attractive one.
Finally, the company is well managed and financially healthy with limited debt and increasing shareholders’ equity.

Filed Under: Investment 2024, Investment2023, Stock Market, Stocks to watch Tagged With: , , , , , , , , , , , , , , ,