Fesco, JMMB & Sygnus in IC TOP10 stocks

February 28, 2021 by

IC TOP10 stocks are now based on earnings for 2021/22 fiscal years. Of the January listing, Access Financial Services moved out of the TOP 10 Junior Market list while Main Market QWI Investment and Carreras fell from the Main market list with increased prices.
Coming into the TOP10 are Fesco, the latest IPO that is expected to come to market shortly, with the prospectus having been released but temporarily withdrawn to correct some errors. JMMB Group and Sygnus Credit Investments are now in the TOP10 Main market listing.
 Since the start of the year, the Junior Market is up 10.5 percent, with 11 companies’ stock rising between 20 and 63 percent, including four with gains from 49 percent up. The Main Market, on the other hand, is marginally down for the year by less than one percent, with five stocks recording gains between 21 percent and 47 percent and Ciboney rising 500 percent for the year to date.
The Junior Market and the Main Market moves are supported by technical indicators, pointing to robust gains ahead and back up by some companies reporting positive profit results.
This week’s focus: Grace Kennedy had outstanding results for 2020 with much more to come in 2021; expect the price to move sharply over the next few weeks. Caribbean Cement reported a 70 percent rise in profit for 2020 and is projected to earn $6.70 for 2021, the stock is an ideal candidate to move higher in the weeks ahead.
The top three stocks in the Junior Market can gain between 329 to 339 percent are Main Event followed by Elite Diagnostic and Jetcon. With expected gains of 202 to 459 percent, the top three Main Market stocks are Radio Jamaica, followed by Berger Paints and VM Investments.  
The local stock market’s targeted average PE ratio is 20 based on profits of companies reporting full year’s results, up to the second quarter of 2021. The Junior and Main markets are currently trading well below the market average, a clear indication of strong gains ahead. The JSE Main Market ended the week, with an overall PE of 14.7 and the Junior Market 9.8 based on ICInsider.com’s projected 2021-22 earnings. The PE ratio for the Junior Market Top 10 stocks average a mere 5.2 at just 53 percent of the market average. The Main Market TOP 10 stocks trade at a PE of 7.1 or 48 percent of the PE of that market.
The average projected gain for the Junior Market IC TOP 10 stocks is 289 percent and 204 percent for the JSE Main Market, based on 2021-22 earnings. IC TOP10 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 movements in and out of the lists weekly. Revisions to earnings per share are ongoing, based on receipt of new information.

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Mailpac drops out of IC TOP15 stock listing

January 17, 2021 by

Stocks left to languish at depressed prices for months are coming back to life as some investors are now seeing the light of the huge potential profit in Junior Market stocks compared to their senior counter paths in the Main Market.
The Main Market slipped a bit to end the first half of January, with a modest loss but technical indicator points to it heading towards the 460,000 points level on the All Jamaica Composite Index, soon. The Junior Market is up 2.4 percent since the 2020 close and is a few points away from the level reached at the close of March 5 last year, having surpassed the April high, as the bullish golden cross takes full hold on the market to launch a big rally.
During this past week, IC TOP 15 selections MailPac, Caribbean Cream and Jamaican Teas all posted gains with Mailpac hitting a series of record highs this past week and closed at $3.75 up 30.6 percent since the end of 2020 and is now well outside of the 2021 Top 15 list for Junior Market stocks. The stocks still have much room for growth in the year to benefit from a strong increase in revenues. Caribbean Cream posted continued growth in sales for the November quarter and almost doubled profit for the nine months period and increased it by 37.5 percent for the third quarter. The stock gained 50 cents at the close on Friday but traded as high as $5 during the week and moved from fifth spot last week to ninth position on the 2020/21 TOP10 list. Jamaican Teas gained 25 percent since December and seems poised to move higher as interest in the stock grows since the announcement of a three for one stock split late last year. An indication of increased interest is the exchange of 4 million shares on Friday. The stock moved from the fourth position last week to seventh this past week as it gained 24 percent for the week.
Lasco Manufacturing rose in the past week and moved out of the TOP10 Junior Market ranks, with Honey Bun replacing it.
The current TOP 10 report is based on earnings for 2020/21 as there are substantial gains ahead, for many stocks in the listings.
Investors should be on the lookout for new quarterly results with Express Catering and Margaritavillle and should release results this week. Before the month ends, expect results from Caribbean Cement, QWI, NCB Financial, Barita and the three Lasco companies.
The top three stocks in the Junior Market with the potential to gain between 208 to 373 percent are Lasco Financial, followed by Caribbean Producers and Elite Diagnostic. With expected gains of 125 to 315 percent, the top three Main Market stocks are, Berger Paints followed by Grace Kennedy and Jamaica Broilers.
The local stock market’s targeted average PE ratio is 20 based on profits of companies 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 strong gains ahead. The JSE Main Market ended the week, with an overall PE of 16.4 and the Junior Market 14.6, based on ICInsider.com’s projected 2020-21 earnings. The PE ratio for the Junior Market Top 10 stocks average a mere 7.6 at just 52 percent of the market average. The Main Market TOP 10 stocks trade at a PE of 9.2 or 56 percent of the PE of that market.
The average projected gain for the Junior Market IC TOP 10 stocks is 185 percent and 130 percent for the JSE Main Market, based on 2020-21 earnings. IC TOP10 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 movements in and out of the lists weekly. Revisions to earnings per share are ongoing, based on receipt of new information.

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Lots of gains left for IC 2020 TOP10 stocks

January 9, 2021 by

The TOP 10 report is back and based on earnings for the 2020/21 period as there are still substantial gains ahead for many stocks in the listing, accordingly, ICInsider.com will hold off from our weekly commentary for the 2021/22 listings posted earlier this week.
For the few days in 2021, the Junior Market has moved slightly higher than the 2020 close and is a few points away from April’s high point and March 5 last year as the bullish golden cross takes full hold on the market to launch a big rally.
The Main Market slipped a bit to end the first week of the new year with a modest loss, but technical indicator points to it heading towards the 460,000 points level on the All Jamaica Composite Index.
Investors should be on the lookout for new quarterly results starting this week with AMG Packaging, Caribbean Cream, Express Catering, Knutsford Express, Margaritaville and Paramount Trading should release results this week. Before the month ends, other results expected are from Caribbean Cement, QWI Investments, NCB Financial, Barita Investments and the Lasco companies.
The top three stocks in the Junior Market with the potential to gain between 199 to 364 percent by March 2021 are Caribbean Producers, followed by Elite Diagnostic and Lasco Financial. With expected gains of 123 to 219 percent, the top three Main Market stocks are Berger Paints, followed by Scotia Group and Grace Kennedy.

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Investment 2021 – Recovery for JSE markets

January 7, 2021 by

The JSE Junior and Main Markets retreated in 2020, due mainly to the impact of the COVID-19 on the economy and businesses. Both markets, however, began to struggle in the final quarter of 2019 as a number of new IPOs were either issued or scheduled to be issued, thereby sapping some of the liquidity from the market.
The markets may have been due for a correction anyway, based on their history. Prior to this period, the Main Market had only risen on two other occasions equalling or exceeding six years. Surprisingly, the market went on to move higher during a period of economic turbulence, from 1978 to 1987, nine years of annual gains and again between 1996 and 2004 for another nine-year spell. On the other hand, the Junior Market, for the first time, recorded five consecutive years of increases from 2015 to 2019.
In reality, the market closed higher in each year from 2014 to 2019 for six years’ unbroken run. The JSE Main Market fell 33 percent to the low in March and the Junior Market by 37 percent.  Since then, they have rebounded but not enough to take them out of the negative territory for the year.
The number of new IPOs coming to market in the past three years pulled liquidity from the Junior Market, which depends extensively on the involvement of individual investors. In 2018 and 2019, the Junior Market under-performed the Main Market, measured by way of the market indices. In 2020, both markets were down, with the Junior Market just edging out the Main Market index with a lower decline of 21 percent versus 22.6 percent. Even though 2020 was not a great year, some investors made money by buying some stocks at rock bottom prices when many investors were dumping.
The decline in the market gives some investors breathing space from the six years’ bull market and opportunities to pick up stocks at better valuations or prices than for the period up to March 2020.
The markets have been recovering since they bottomed in March with the Junior Market up 30 percent and the Main Market 16.6 percent. There are strong signals pointing to an upward move for both markets as they transitioned from a consolidating phase when investors were assessing developments in the economy and the stock market.  The Golden cross technical signal for the Junior Market points to that market heading back above the 3,000 points level within months. The Main Market is undergoing a bullish signal with short term moving average line crossing over the medium-term Moving Average a bullish signal. The Main Market is within an ascending channel that points to the All Jamaican index heading towards the 460,000 points range.
Market valuations are reasonable with the PE ratios based on 2020 earnings at 14.7 times for the Junior Market and 17 for the Main Market, a few stocks are priced higher than the average, with many prices well below. Based on 2021 earnings, the PE ratio is an average of 9.2 for Junior Market stocks and 14.7 for the Main Market. The large difference is an indication as to where the best values can be found for investors. Adequate liquidity can be a problem for the Junior Market and many investors need to take a longer-term view in some of these companies as it is sometimes difficult to buy or sell good volume at prevailing market prices under current market conditions.
The local economy is currently down sharply, compared to 2019, but information released by Statin shows the economy picking up from the depressed June quarter, when major areas of the local economy were closed due to COVID-19. However, there are signs that the recovery has been picking up the pace and could move higher if the Coronavirus does not have any greater impact.
While the restrictions placed on economic and social activity has eased since the June quarter, it’s not business as usual in many areas. Investors still need to keep an eye on COVID-19 developments globally and any likely effects on the local economy. Barring any negative developments, stocks highly exposed to tourism, construction, banks and some manufacturing entities could see revenues and profits improving in 2021.
The TOP Main Market stocks’ potential gains range from 70 percent to 290 percent. The Junior Market range is 145 percent to 400 percent. Quite a number of the TOP 15 are recovery candidates. In fact, the Junior Market is filled with these, of which there are six that suffered badly from the effects COVID-19 had on their customers or in dampening demand for their products. A few in the Main Market were partially affected but not as much as some Junior Market companies.
This year 2021, seems set to be the year of surprises as many stocks that suffered badly in 2020 could be making a major turnaround in revenues and profit, while some that may not fully recover could start showing good signs of returning to normalcy.
The TOP 15 Main Market stocks: Berger Paints, Grace Kennedy, Jamaica Broilers, Pan Jam Investment, Radio Jamaica, Victoria Mutual Investments, Scotia Group, QWI Investments, Wisynco Group, Carreras, Sygnus Credit Investments, JMMB Group, Caribbean Cement, Seprod and Sterling Investments.
The TOP 15 Junior Market stocks: Lasco Financial, Caribbean Producers, Caribbean Cream, Main Event, Elite Diagnostic, Jetcon, Medical Disposables, Caribbean Assurance Brokers, Access Financial, Stationery and Office Supplies, Jamaican Teas, General Accident, Lasco Distributors, Lumber Depot and MailPac.
While there are clear signs of improving economic conditions, the path for the year ahead is uncertain for a number of companies. Some that suffered badly in 2020 will be showing signs of recovery, but the timing of their return to fairly good health is unclear at this stage. Investors should be on the watch for these early signs in individual companies.
Banks suffered from the need to increase expected credit loss provisioning, but it appears that it may not be as bad as initially projected. As such, there is likely to be less provision for credit losses in 2021 for banks and other lenders.

JSE Main Market on a rebound and heading to 460,000 points based on the AJ Index.

For other companies, just the fact that the second quarter lockdown of the economy last year is unlikely to be repeated will result in second quarter results in 2021 being better than last year. This would be of benefit to Caribbean Producers, Elite Diagnostic, Jetcon and Stationery and Office Supplies.
Strong growth in the construction sector favours stocks such as Berger Paints, Caribbean Cement and Lumber Depot while a rebound in the tourism sector will help boost revenues for Caribbean Producers, Grace Kennedy, Jamaica Broilers, Wisynco Group and the banks.
The financial challenges caused by the coronavirus are likely to lead to some businesses seeking to merge or dispose of a majority interest to other entities. As such, there is the possibility that a number of listed companies could acquire some of them at good prices. This is a potential development that investors should be on the alert for.

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More big price changes for IC TOP10

December 27, 2020 by

Last week, the Junior Market continued to move higher, closing higher than the prior week as the market index continues to flirt with the 2,600 points mark ahead of breaking higher and ended at the highest weekly close since mid-August as the bullish golden cross takes full hold on the market to launch a big rally.

Carreras stock price rose 14% during the past week.

In the process of the Junior and Main Market rising this past week, it ended with no new change to the TOP10 lists but there were some price movements of note during the week. Caribbean Producers having fell to $2.74 in the previous week rebounded 5 percent this past week to $2.89, while Lasco Financial lost 9 percent to close at $2.50.
The JSE Main Market rose to the highest level in nine trading days, during the week as it targets the 450,000 points level on the All Jamaica Composite Index in the next few weeks. Two stocks on the TOP10 made good gains in the week. Carreras that has lied in the top tier for some time, finally made a move, with a rise of 14 percent to $7.35 and now sits at no 6 spot, on the list. Radio Jamaica climbed another 13 percent this week, as sellers are less visible, with buyers pushing the price to $1.45 for a rise of 33 percent in just three weeks.
This week’s focus: The long awaited initial public offer of shares by Alliance Finance was announced this past week, with an offer for existing shareholders to sell 1.15 billion shares at $1.59 each. The prospectus containing details of the offer was released this past Wednesday, with the opening date of December 28. Other issues already announced are Sygnus Credit Investments, scheduled to close Wednesday gone, is extended to December 28. The original closing date was not convenient for some investors as the Christmas season placed pressure on some to meet the deadline. Key Insurance the smallest of the lot with a rights issue opens on December 28 and Derrimon Trading opens on January 8. Sygnus Credit Investments appears to be the best value offering with a PE below 10 times earnings.
The top three stocks in the Junior Market with the potential to gain between 220 to 350 percent by March 2021 are Caribbean Producers, followed by Elite Diagnostic and Lasco Financial, with Jamaican Teas slipping to 4th place. With expected gains of 133 to 221 percent, the top three Main Market stocks are, Berger Paints followed by Scotia Group and Grace Kennedy.
The local stock market’s targeted average PE ratio is 20 based on profits of companies 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 strong gains ahead. The JSE Main Market ended the week, with an overall PE of 16.4 and the Junior Market 14, based on ICInsider.com’s projected 2020-21 earnings. The PE ratio for the Junior Market Top 10 stocks average a mere 7.2 at just 52 percent of the market average. The Main Market TOP 10 stocks trade at a PE of 9.3 or 57 percent of the PE of that market.
The average projected gain for the Junior Market IC TOP 10 stocks is 194 percent and 121 percent for the JSE Main Market, based on 2020-21 earnings. IC TOP10 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 movements in and out of the lists weekly. Revisions to earnings per share are ongoing, based on receipt of new information.

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Strong price changes for IC TOP10 stocks

December 20, 2020 by

Last week, the Junior Market closed the week at the highest level since November 17 and before that, October 2 and moved higher this week to just below mid-August summer high. Based on the close on Thursday when the market closed above 2,600 points, the first in several months the market seems poised to challenge the April high point before the year ends.
The Main Market closed lower at the end of the past week having pulled back from last week from the close of the previous week. Against the above out turn, there is just one new addition to the TOP10 at the end of the week but there were some price movements of note during the week.
Lasco Manufacturing edged into Junior Market TOP10 as Derrimon Trading fell out with our projection for earnings down to 13 cents per share for the current year.
Radio Jamaica surged 14 percent to close at $1.28 after the company reported completion of its reorganization that resulted in 107 persons made redundant and restructuring of the operating segments within the group that should allow for greater efficiency and focus. The market closed the week with limited stocks on offer suggesting, the price should be moving higher if buyers want to stock up. AMG Packaging and Caribbean Producers fell 7 percent to $1.55 and $2.74, respectively. Lasco Distributors fell 8 percent to $3.16 from $3.55. Lumber Depot rose 12 percent to $1.55 and Jamaican Teas gained 8 percent to $2.05.
The top three stocks in the Junior Market with the potential to gain between 193 to 374 percent down from  216 to 342  percent by March 2021, are Caribbean Producers, followed by Elite Diagnostic and Jamaican Teas. With expected gains of 138 to 221 percent, the top three Main Market stocks are, Berger Paints followed by Carreras and Scotia Group.
The local stock market’s targeted average PE ratio is 20 based on profits of companies 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 strong gains ahead. The JSE Main Market ended the week, with an overall PE of 16.8 and the Junior Market 13.7, based on ICInsider.com’s projected 2020-21 earnings. The PE ratio for the Junior Market Top 10 stocks average a mere 7.2 at just 53 percent of the market average. The Main Market TOP 10 stocks trade at a PE of 9.2 or 55 percent of the PE of that market.
The average projected gain for the Junior Market IC TOP 10 stocks is 194 percent and 125 percent for the JSE Main Market, based on 2020-21 earnings. 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 movements in and out of the lists weekly. Revisions to earnings per share are ongoing, based on receipt of new information.

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IC TOP10 stocks deliver strong gains

December 12, 2020 by

The Junior Market closed the week at the highest level since November 17 and before that, October 2 and seems poised to take out all recent highs on the way to the year-end rally and a bullish period to come, to take it over 3,000 points. The main Market pulled back from last week’s levels but closed at the highest point for the week on Friday.
Honey Bun dropped out of the TOP 10, with Derrimon Trading replacing it at the bottom of the list. Honey Bun’s stock price jumped 19 percent for the week to $6.49 on Friday, with the stock now showing very limited supply and a bit of demand on the buying side, although a bit below the last sale price. The increased demand this week follows a strong September quarter profit that rose 76 percent over 2019. Wisynco Group spent just a week in the Main Market TOP 10, moved up in price to close out the week with the stock rising to $16.43 from $16.10 and replaced by NCB, in at the tenth position. The projections are for earnings to recover from the increased provision for expected credit loss charges in 2020 and from continued growth in the business and deliver earnings of $12 per share for the current year to September.
Former TOP10 holder MailPac, hit a record high on Friday, in closing at $2.60, up 19 percent from $2.19 last week. Lumber Depot reported earnings for the October quarter, keeping earnings on track for 20 cents per share and put added life into the stock, moving the price up 6 percent to close the week at $1.39 at a PE of 7 times earnings, well below the market average of 13.7. Caribbean Producers moved up 13 percent from $2.60 to $2.94 at the close and up a nice 21.5 percent for the month to date. The stock seems on target to move back into the $4 range sooner than later, with stock supplies thinning out and prospects for improved business looking increasingly better in 2021.
The top three stocks in the Junior Market with the potential by March 2021 to gain between 216 to 342 percent down from 239 to 400 percent at the end of the previous week are Caribbean Producers, even with the price has moved in recent weeks from $2.35 to $2.94 currently, followed by Elite Diagnostic and Jamaican Teas. Lumber Depot, in at third position last week, is now down to sixth after investors responded positively to quarterly results. With expected gains of 146 to 236 percent, the top three Main Market stocks are Berger Paints, followed by Radio Jamaica and Carreras.
The local stock market’s targeted average PE ratio is 20 based on profits of companies 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 strong gains ahead. The JSE Main Market ended the week, with an overall PE of 16.6 and the Junior Market 13.7, based on ICInsider.com’s projected 2020-21 earnings. The PE ratio for the Junior Market Top 10 stocks average a mere 7.3 at just 53 percent of the market average. The Main Market TOP 10 stocks trade at a PE of 9.1 or 55 percent of the PE of that market.
The average projected gain for the Junior Market IC TOP 10 stocks is 192 percent down from 210 percent and 129 percent from 133 percent last week for the JSE Main Market, based on 2020-21 earnings. 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 movements in and out of the lists weekly. Revisions to earnings per share are ongoing, based on receipt of new information.

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IC TOP 10 buffeted by market consolidation

December 7, 2020 by

Both the Junior and Main Market continue to consolidate ahead of a bullish period to come, as trading activities were calmer during the past week on the Jamaican Stock Exchange after a surge in prices towards the end of November. There were no major price movements this past week, but the price of Grace Kennedy pulled back from $67 to close at $64 at the end of the week while JMMB Group moved up to $35 from $34 last week.

Wisynco squeezes back into ICInsider TOP 10.

Fontana closed trading $5.35 and that was enough to move it out of the IC TOP 10. Honey Bun, with its earnings now based on the fiscal year ending September 2021 replaced Fontana. Stanley Motta is out of the Main Market TOP 10, with the stock rising to $5.35 and replaced by Wisynco Group, in at tenth position.
Profit after tax at Honey Bun, rose a healthy 76 percent to $54 million from $31 million in the fourth quarter over the similar period in 2019, bettering the 21 percent rise in the June quarter, to $20.4 million from $16.7 million. For the year to September, profit increased just 6.6 percent to $167 million from $156 million in 2019, from sale revenues that rose 15.5 percent for the quarter, to $432 million from $374 million but rose 8.5 percent for the year, to $1.675 billion from $1.544 billion in 2019. Earnings projection for the 2021 fiscal year is 55 cents, up from 35 cents for 2020 giving the stock a PE of 10.

Wisynco Group’s performance was on a roll, with revenues up 27.5 percent in the nine months to March this year, and 24 percent in the March quarter, but gross profit margin slipped in the March quarter while rising Administration and other expenses squeezed profits even more. Sales dipped slightly in the June and September quarters, but the September 2019 quarter, includes sales of $503 million from a discontinued operation, leaving flat sales from ongoing operations. Net Profits Attributable to Stockholders from continuing operations was $851 million or 23 cents per stock unit compared to $932 million or 25 cents per stock unit for the corresponding period of the prior year. Revenues for the quarter from continuing operations of $8.1 billion fell 6.1 percent from $8.6 billion in the 2019 quarter. The company expects to have lower energy costs with the successfully commissioning of the Cogeneration plant in July 2020, with the company seeing a positive contribution from the implementation through reduced energy costs.
The top three stocks in the Junior Market with the potential to gain between 239 to 400 percent by March 2021 are Caribbean Producers, followed by Elite Diagnostic and Limber Depot. With expected gains of 147 to 252 percent, the top three Main Market stocks are, Berger Paints followed by Radio Jamaica, Carreras and Sygnus Credit Investments tied for the third position.
The local stock market’s targeted average PE ratio is 20 based on profits of companies 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 16.1 and the Junior Market 13.1, based on ICInsider.com’s projected 2020-21 earnings. The PE ratio for the Junior Market Top 10 stocks average a mere 6.9 at just 53 percent of the market average. The Main Market TOP 10 stocks trade at a PE of 9 or 56 percent of the PE of that market.
The average projected gain for the Junior Market IC TOP 10 stocks is 210 percent and 133 percent for the JSE Main Market, based on 2020-21 earnings. 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 movements in and out of the lists weekly. Revisions to earnings per share are ongoing, based on receipt of new information.

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Shake up of IC TOP 10

November 16, 2020 by

A raft of company results was unleased on the Jamaican Stock Exchange, resulting in changes to the IC TOP 10. Some companies have not yet recovered sufficiently from the fall out following the COVID-19 outbreak earlier this year.

Fontana Waterloo Square Branch just after it was opened in October 2019.

Entering the Junior Markets Top10 are Access Financial and Fontana. Moving out are General Accident and Stationery and Office Supplies, both of which reported lower than expected profits for the September quarter and year to date. NCB Financial dropped out of the Main Market TOP 10 with full-year earnings coming in at $8.01 as the group stepped up the provisioning of expected credit losses. Eppley moved into the spot left vacant by NCB.
The Main Market closed the past week with notable gains in the market index while the Junior Market slipped modestly at the end of the week. Signals in the market continue to point to higher prices ahead. The Junior Market is currently signaling a big surge starting in December as short-term moving averages cross over longer-term ones to confirm a strong rally ahead. The move in the Main Market continues the move gradually higher ahead of the year-end and is in keeping with bullish signs that points to more gains ahead.
This week’s focus: Fontana had a 21 percent increase in revenues for the quarter ending September to $1.11 billion, over $921 million in the 2019 corresponding quarter. Gross profit also increased 25 percent to $395 million above $316 million generated in the September 2019 quarter. Administrative selling and other expenses grew modestly by 4.5 percent from $296 million to $310 million, even as the company benefited from economies of scale with the Waterloo Square location. Net profits increased to $45 million, a 146 percent improvement from the $18 million recorded in the prior year, with foreign exchange losses adding $27 million to finance cost in the 2020 quarter. The company is on target to earn 50 cents per share for the current financial year ending June 2021.
The top three stocks in Junior Market remain as they were this past week, with the potential to gain between 233 to 465 percent by March 2021. Caribbean Producers heads the list, followed by Elite Diagnostic and Limber Depot. 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 168 to 238 percent, the top three Main Market stocks are now, Berger Paints followed by JMMB Group and Radio Jamaica in the third position.
The local stock market’s targeted average PE ratio is 20 based on the profits of companies 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 13.2, 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 7.1 at just 54 percent to the Junior Market average. The Main Market TOP 10 stocks trade at a PE of 8.7 or 55 percent of the PE of that market.
The average projected gain for the Junior Market IC TOP 10 stocks is 210 percent and 136 percent for the JSE Main Market, based on 2020-21 earnings, indicating greater gains are likely 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 movements in and out of the lists weekly. Revisions to earnings per share are ongoing, based on receipt of new information.

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Stationery & Office back in IC TOP 10

November 8, 2020 by

Stationery and Office Supplies returns to the Junior Market IC TOP 10 list for the first time since February last year as the stock price dropped to $4.55 and replaced Medical Disposables that reported a loss in the half-year, resulted in the downgrading of full year’s earnings and potential stock price movement.

Stationery & Office Supplies Head quarters

Medical Disposables earnings per share are now projected at 30 cents for the current year and 85 cents for the succeeding year and put the PE ratio at 14 times current-year earnings. As indicated last week, Lasco Financial was set to be a big winner for the past week, after the company reported outstanding second-quarter profit. The stock rose 23 percent to close the week at $2.60 after trading as high as $2.75 in the week. The price should move higher going forward, with likely earnings around 40 cents per share for the current fiscal year and a PE ratio of 6.5.
Signals in the market continue to point to higher prices ahead. The Junior Market is currently signaling a big surge 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: Grace Kennedy continues to enjoy a phenomenal year, with profit attributed to the company’s shareholders, rising 33 percent to $1.68 billion in the September quarter, from $1.26 billion for the third quarter in the previous year and grew 35 percent for the nine months to September, to just $4.4 billion from $3.27 billion the corresponding period in 2019. Taxation more than doubled in both periods, but profit before tax grew 49 percent in the third quarter to $2.79 billion and for the nine-months, it rose 51.5 percent to $7.3 billion. Earnings per share are $1.69 for the quarter and $4.47 for the nine months and should exceed $6 for the full year.
The top three stocks in Junior Market remain as they were this past week, with the potential to gain between 272 to 726 percent by March 2021. Caribbean Producers heads the list, followed by Caribbean Assurance Brokers and elite Diagnostic. 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 150 to 238 percent, the top three Main Market stocks are now, Berger Paints followed by JMMB Group and Grace Kennedy in the third position.
The local stock market’s targeted average PE ratio is 20 based on the profits of companies 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 12.1, 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 6.5 at just 54 percent to the average of the Junior Market. 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 247 percent, and 147 percent for the JSE Main Market, based on 2020-21 earnings, indicating 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 movements 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.

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