Kremi and NCB Financial are back in the Main and Junior Markets IC TOP 10 lists for the week as Access Financial and Salada Foods moved out, with the former earnings downgraded following the release of half-year results while the latter recovered from the price decline suffered in the previous the week.  

Jacinth Hall-Tracey, Managing Director of Lasco Financial.

The past week belonged to Caribbean Cement (CC) that posted strong increased revenues and profit with the stock jumping 12.5 percent from $45.96 to close at $57. As was the case with CC last week, Lasco Financial is set to be a big winner this week, with the company reporting outstanding second-quarter profit that should encourage investors to pick up the stock.
The Main and Junior markets closed trading for October lower than September. Signals in the market point to higher prices ahead. The Junior Market is currently signaling a big surge that will start in a few weeks as short-term moving averages cross over longer-term ones to confirm a strong rally ahead. The big move in the Main market seems a few months away, but signs are that the market should continue to move gradually higher ahead of the year-end.
This week’s focus: Lasco Financial generated $136 million in the September quarter profit compared with a loss of $16 million for the second quarter in the previous year. Profit after tax for the six months to September amounts to just $30 million, down from the corresponding period’s $75 million, and an improvement on the first-quarter loss of $106 million. Earnings per share ended at 10.7 cents for the quarter and 2.4 cents for the half-year. For the quarter, revenues fell 5.7 percent or $38 million from the 2019 September quarter to $617 million, due largely to the decline of revenues from loans that fell 34.5 percent or $152 million in the six months to September, compared with the previous year financial period.
Remittances grew 11 percent and added $50 million to revenues while Cambio operations contributed 10.8 percent or $34 million to increased revenues, the company’s Managing Director Jacinth Hall-Tracey, informed shareholders in a commentary accompanying the quarterly report.
Access Financial reported $62 million in profit after tax for the six-month to September, compared to $280 million for the same period in 2019. Higher revenue in the September quarter was offset by a $45 million increased loan loss provision, resulting in a slightly lower profit of $29 million versus $33 million in the first quarter. The next few quarters will be interesting to watch for future direction.
The top three stocks in Junior Market remain as they were this past week, with the potential to gain between 287 to 723 percent by March 2021. Caribbean Producers heads the list, followed by Lasco Financial and Elite Diagnostic. With Lasco Financial posting strong second-quarter results, they will likely drop out of the top three this coming week. The focus on all three is on the 2021 fiscal year profit, projected to recover from reduced profit for the 2020 financial year. With expected gains of 161 to 238 percent, the top three Main Market stocks are now Berger Paints followed by JMMB Group, Radio Jamaica replacing Grace Kennedy in the third position last week.
The market’s targeted average PE ratio is 20, based on companies’ profits reporting full year’s results from now to the second quarter in 2021. The Junior and Main markets are currently trading well below the market average, indicating the potential gains ahead. The JSE Main Market ended the week, with an overall PE of 15.8 and the Junior Market 12.2, based on ICInsider.com’s projected 2020-21 earnings. The average PE ratio of the Junior Market has been slowly rising, with better profit opportunities than the Main Market and narrowing the gap. The PE ratio for the Junior Market Top 10 stocks average a mere 6 at just 49 percent to the Junior Market average. The Main Market TOP 10 stocks trade at a PE of 8.3 or 52 percent of the PE of that market.
The average projected gain for the Junior Market IC TOP 10 stocks is 287 percent, and 149 percent for the JSE Main Market, based on 2020-21 earnings, indicates potentially greater gains in the Junior Market than the Main Market.
IC TOP 10 stocks are likely to deliver the best returns up to March 2021 and ranked in order of potential gains, based on likely gain 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 movement in and out of the lists for most weeks. 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.

Oversubscribed public stock issues were the most pronounced development in the Jamaican stock market for the past two weeks. Barita Investments raised $13.5 billion from the public offer of new ordinary shares in the previous week and was joined by Tropical Battery, with their IPO that closed on the same day of opening, with a raise of $325 million. 

Barita eyeing acquisition.

Barita, a former IC Buy Rated stock capital raise, resulted in its share capital more than doubling from $10.88 billion to $24.4 billion and the overall equity capital moving to $28.74 billion. The stock price climbed to $77 at the close on Friday and provided investors in the APO with a nice 48 percent gain and more for smaller investors who bought at $49.
For a third consecutive week, there was no change in the companies on the IC TOP 10 listings, with the markets moving moderately higher partially helped by the rise in the price of Barita’s stock.
With the two public share issues out of the way, the Jamaica Stock Exchange market indices rose during the week with the JSE Main Market indices closing at the highest point since August 3 while the Junior Market was highest since August 26. The week’s movement reversed the negative effect the two issues had in diverting funds away from the market.
The top three stocks in each market saw no change in ranking for the top three Junior Market stocks, with the potential to gain between 295 to 709 percent by March 2021. Caribbean Producers heads the list, followed by Lasco Financial and Elite Diagnostic. The focus on all three is the 2021 fiscal year results, projected to show recovery from the 2020 financial year final numbers. The top three Main Market stocks, with expected gains of 205 to 231 percent, are Radio Jamaica, followed by Berger Paints and JMMB Group.
The targeted average PE ratio of the market is 20 based on the profits of companies reporting full year’s results, from now to the second quarter in 2021. Both the Junior Market and the Main Market are currently trading well below this level, indicating the potential gains ahead. The JSE Main Market ended the week, with an overall PE of 14.8 and the Junior Market 11.2, based on IC Insider.com’s projected 2020-21 earnings. The average PE ratio of the Junior Market has been slowly rising, with better profit opportunities than the Main Market and narrowing the gap. The PE ratio for the Junior Market Top 10 stocks average a mere six at just 54 percent to the average of the overall Junior Market. The Main Market TOP 10 stocks trade at a PE of 8.3 or 56 percent of the PE of the overall market.
The average projected gain for the Junior Market IC TOP 10 stocks is 280 percent, and 151 percent for the JSE Main Market, based on 2020-21 earnings, indicates potentially more significant gains in the Junior Market than in the Main Market.
IC TOP 10 stocks are likely to deliver the best returns up to March 2021 and ranked in order of potential gains, based on the possible 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 will result in movements of the selection in and out of the lists for most weeks. 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.

For a second consecutive week, there were no changes in the companies on the IC TOP 10 listings, with the markets going sideways and little or no significant price moving news.

Barita public stock offer pulled money away from other JSE stocks.

The Jamaica Stock Exchange market activity was negatively affected by funds diverted away from the as investors moved money into the successful Barita Investments issue of new shares. The Issue closed on Wednesday gone and was upsized to $13.5 billion, resulting in a more than doubling of the issued shares from $10.88 billion to $24.38 billion and the overall equity capital to $28.74 billion.
The past week that saw the local market trading in a narrow range, with the Junior Market closing slightly down for the week after ending the previous week at the highest point since August 28 and the Main Market had the highest weekly close since the end of August.
The top three stocks in each market saw no change in ranking, leaving the top three Junior Market stocks, with the potential to gain between 292 to 695 percent by March 2021. Caribbean Producers heads the list, followed by Lasco Financial and Elite Diagnostic. The focus on all three is on the 2021 fiscal year results projected to show recovery from the 2020 financial year final numbers. The top three Main Market stocks, with expected gains of 204 to 228 percent, are Radio Jamaica, followed by Berger Paints, with the price rising 7 percent during the week and JMMB Group.
This week’s focus – Tropical Battery issue for 325 million ordinary shares at $1 each of with up to 187.5 million units reserved for priority applications, opens Tuesday, September 22, with the scheduled closing of September 30, subject to the right of the Company to close it earlier. With earnings per share around 7.7 cents, the stock is priced around a PE ratio of 13 times 2020 earnings, leaving little or no room for short term gains as it is priced 19 percent above the market average.
The targeted average PE ratio of the market is 20 based on the profits of companies reporting full year’s results, from now to the second quarter in 2021. Both the Junior and Main markets are currently trading well below this level, indicating the potential gains ahead. The JSE Main Market ended the week, with an overall PE of 15.3 and the Junior Market 11, based on IC Insider.com’s projected 2020-21 earnings. The average PE ratio of the Junior Market has been slowly rising, with better profit opportunities than the Main Market and narrowing the gap. The PE ratio for the Junior Market Top 10 stocks average a mere six at just 55 percent to the average of the overall Junior Market. The Main Market TOP 10 stocks trade at a PE of 8.2 or 54 percent of the PE of the overall market.
The average projected gain for the Junior Market IC TOP 10 stocks is 280 percent, and 151 percent for the JSE Main Market, based on 2020-21 earnings, indicates potentially more significant gains in the Junior Market than in the Main Market.
IC TOP 10 stocks are likely to deliver the best returns up to March 2021 and ranked in order of potential gains, based on possible gain 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 will result in movements of the selection in and out of the lists for most weeks. 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.

The past week was quiet for IC TOP 10 listings, resulting in no change to the list at the end of the week that saw the local market trading in a narrow band and the Junior Market closing at the highest point since August 28 and the Main Market since the end of August.

Scotiabank profit drops in Jamaica.

The top three stocks in each market saw no change in ranking, leaving the top three Junior Market stocks, with the potential to gain between 292 to 695 percent by March 2021. Caribbean Producers heads the list, followed by Lasco Financial and Elite Diagnostic. The focus on all three is on the 2021 fiscal year results, projected to show recovery from the 2020 financial year final numbers. The top three Main Market stocks, with expected gains of 205 to 264 percent, are Berger Paints followed by Radio Jamaica and JMMB Group. All three suffered declines during the week.
This week’s focus: Scotia Group reported a net income of $5.56 billion for the nine months ending in July, compared to $9.79 billion for the corresponding 2019 period. Overall, loans advanced, grew 12 percent mainly due to the strong performance of the Commercial Banking unit, increasing 24 percent versus the prior year. Retail loan grew 5 percent year over year, driven by strong mortgage growth of 16 percent. Total revenues, excluding expected credit losses for the nine months, ended July at $32.1 billion, a reduction of $1.7 billion or 5.1 percent, compared to 2019. For the July 2020 quarter, gross revenues fell from $12.4 billion to $11 billion, with non-interest income contributing $1.1 billion to the decline. Administrative and other expenses were essentially flat at $5.8 billion year over year, a $2 billion increase in provision for expected loan loss helped push profit down in the quarter, to $1.55 billion from $4.2 billion in 2019. Notably, while loans amounting to $221 billion at the end of July grew 12 percent year over year, loans declined modestly from $223 billion at the end of April, the result of the increased credit loss provisioning.
The targeted average PE ratio of the market is 20 based on the profits of companies reporting full year’s results, from now to the second quarter in 2021. Both the Junior and Main markets are currently trading well below this level, an indication of the potential gains ahead. The JSE Main Market ended the week, with an overall PE of 15.1 and the Junior Market 10.9, based on IC Insider.com’s projected 2020-21 earnings. The average PE ratio of the Junior Market has been slowly rising, with better profit opportunities than the Main Market and narrowing the gap. The PE ratio for the Junior Market Top 10 stocks average a mere 6 at just 55 percent to the average of the overall Junior Market. The Main Market TOP 10 stocks trade at a PE of 8.2 or 54 percent of the PE of the overall market.
The average projected gain for the Junior Market IC TOP 10 stocks is 279 percent, and 153 percent for the JSE Main Market, based on 2020-21 earnings, an indication of potentially, greater gains in the Junior Market than in the Main Market.
IC TOP 10 stocks are likely to deliver the best returns up to March 2021 and ranked in order of potential gains, based on likely gain 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 will result in movements of the selection in and out of the lists for most weeks. 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.

General Accident released six months’ results at the top of the week, but the market did not like it, with falling premium and profit in the June quarter leaving the stock price languishing at $6.40, having closed the prior week at $7.20. The fall elevating it back into the Junior Market TOP 10, with Lasco Distributors dropping out, while there was no change to the main market list.
Noticeable changes in the TOP 10, during the week, was a $3.90 rise in the price of Scotia Group to end at $48. Grace Kennedy slipped 99 cents to close at $56.01, Jamaica Broilers lost $3 to close at $23 and Access Financial rose 98 cents to last trade at $23.50 and closed, with the bid at $24.
The top three stocks in each market saw little change in ranking, leaving the top three Junior Market stocks, with the potential to gain between 258 to 692 percent by March 2021. Caribbean Producers heads the list, followed by Lasco Financial and Elite Diagnostic, the focus on all three is on the 2021 fiscal year results that are projected to show recovery from the 2020 financial year final numbers.
The top three Main Market stocks, with expected gains of 188 to 223 percent, are Berger Paints followed by Radio Jamaica and JMMB Group.
The targeted average PE ratio of the market is 20 based on the profits of companies reporting full year’s results, from now to the second quarter in 2021. Both the Junior and Main markets are currently trading well below this level, an indication of the potential gains ahead. The JSE Main Market ended the week, with an overall PE of 15 and the Junior Market 10.6, based on IC Insider.com’s projected 2020-21 earnings. The average PE ratio of the Junior Market has been slowly rising, with better profit opportunities than the Main Market and narrowing the gap. The PE ratio for the Junior Market Top 10 stocks average a mere six at just 56 percent to the average of the overall Junior Market. The Main Market TOP 10 stocks trade at a PE of 8.1 or 54 percent of the PE of the overall market.
The average projected gain for the Junior Market IC TOP 10 stocks is 277 percent, and 153 percent for the JSE Main Market, based on 2020-21 earnings, an indication of potentially more significant gains in the Junior Market than in the Main Market.
IC TOP 10 stocks are likely to deliver the best returns up to March 2021 and ranked in order of potential gains, based on possible gain 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 will result in movements of the selection in and out of the lists for most weeks. 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.

In a week when several companies released quarterly results, few had any positive information to move prices forward. Against this development, some stocks pulled back a bit, flowing from weaker than expected results. Last week’s drop out candidate,

Caribbean Cream posted big gains in profit in Q1.

Caribbean Cream, closed the week at $4.10, to return to the Junior Market TOP 10, at the expense of Mailpac Group. There were no changes to the main market list.
The Mailpac Group operations enjoyed a 33 percent rise in revenues for the six months to June and a 36 percent increase in profit over the similar period in 2019. Flowing from those results, IC Insider.com revised the earnings per share down to 20 cents, thus reducing the potential gain based on 2020 earnings, moving it out of the top listing.
The top three stocks in each market saw little change in ranking, leaving the top three Junior Market stocks, with the potential to gain between 281 to 676 percent by March 2021. Caribbean Producers heads the list, followed by Lasco Financial and Elite Diagnostic, the focus on all three is on the 2021 fiscal year results, that are projected to show recovery from the 2020 financial year final numbers.
The top three Main Market stocks with expected gains of 189 to 223 percent are Berger Paints followed by Radio Jamaica and JMMB Group.
This week’s focus: 138 Students Living reported a 44 percent increase in revenues to hit $334 million from $223 million in the June 2019 quarter and a 60 percent rise in the nine months to $1.09 billion. The company moved from a loss of $17 million in the 2019 third quarter to a profit of $132 million in 2020 and from a loss of $60 million in the nine months to June, to a profit of $402 million. Operating cost fell in both periods compared with the 2019 cost. The big problem is that the company continues the extremely poor practice of not showing operating and administrative expenses separately, making it impossible to see what gross margins are. The significant increase in profit is due to claims made on the University going back to 2019, which are booked in the current year that distorts earnings from ongoing operations. While earnings per share for the quarter is an attractive 32 cents and year to date 97 cents. Earnings from ongoing operations suggest that the full year’s results should be in the order of 40 cents after a regular tax charge.
The targeted average PE ratio of the market is 20 based on the profits of companies reporting full year’s results, from now to the second quarter in 2021. Both the Junior and Main markets are currently trading well below this level, an indication of the potential gains ahead. The JSE Main Market ended the week, with an overall PE of 15.2 and the Junior Market at just 10.9, based on IC Insider.com’s projected 2020-21 earnings. The average PE ratio of the Junior Market has been slowly rising, reflecting better profit opportunities in the Main Market and narrowing the gap. The PE ratio for the Junior Market Top 10 stocks averages a mere 5.9 at just 54 percent to the average of the overall Junior Market. The Main Market TOP 10 stocks trade at a PE of 8.2 or 54 percent of the PE of the overall market.
The average projected gain for the Junior Market IC TOP 10 stocks is 278 percent, and 152 percent for the JSE Main Market, based on 2020-21 earnings, an indication of potentially more significant gains in the Junior Market than in the Main Market.
IC TOP 10 stocks are likely to deliver the best returns up to March 2021 and ranked in order of potential gains, based on possible profit 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 will result in movements of the selection in and out of the lists for most weeks. 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.