Two companies exist ICTOP10

As was the case last week, the Jamaica stock market continues to consolidate as it awaits developments that will push investors to act decisively. At the same time, the Main Market traded heavily and sat below the close of the previous week but the Junior Market mostly traded above the prior week’s close.
After just one week in the ICTOP10, Tropical Battery price rose this week and resulted in the stock falling outside the top flight, to be replaced by Lasco Manufacturing that dropped out during the previous week. In the Main Market, Scotia Group slipped out of the TOP10 and Radio Jamaica reentered.
At the end of the week, Tropical Battery rose 9 percent to $2.60, Image Plus Consultants gained 6 percent to close at $2.05, Paramount Trading rallied 5 percent to $2.20 and Iron Rock Insurance rose 4 percent to end at $2.50. Honey Bun fell 8 percent to $7.07 and was the only one of only two stocks to decline for the week, with the other slipping by just one percent.
In the Main Market, 138 Student Living popped 11 percent to $5.56, while Berger Paints fell 8 percent to $9.75, followed by a 5 percent decline for Jamaica Broilers to close at $30.
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 14.7, while the Junior Market Top 10 PE sits at 6.6 versus the market at 12.8, important indicators of the level of the undervaluation of the ICTOP10 stocks currently. The Junior Market is projected to rise by 208 percent and the Main Market TOP10 an average of 275 percent, to May this year. The major concern for the Main Market achieving such gains by May is that the list is dominated by financial companies that are out of favour and may need to see the summer months before full interest of investor start to show.
The Junior Market has 16 stocks representing 33 percent of the market, with PEs from 15 to 31, averaging 21 compared with the above average of the market. The top half of the market has an average PE of 18. The above average shows the extent of potential gains for the TOP 10 stocks. The situation in the Main Market is similar, with the 18 highest valued stocks priced at a PE of 15 to 116, with an average of 28 and 21 excluding the highest valued stocks and 28 for the top half excluding the highest valued stock.
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.

JSE Main Market rise as Junior Market falls

Trading picked on the Jamaica Stock exchange on Friday and led to the JSE Main Market and the USD Market of the Jamaica Stock Exchange closing higher, but the  Junior Market declined for a third consecutive day following the big jump it enjoyed on Monday and Tuesday.
Trading ended with an exchange of 15,002,754 shares, down from 11,852,477 units on Thursday, valued at $117 million up from $51.7 million on the previous day. Trading on the JSE USD market resulted in investors exchanging US$20,906 compared with US$12,989 on Thursday.
At the close, the Combined Market Index gained 557.08 points to 351,286.59, the  All Jamaican Composite Index added 394.82 points to end at 381,036.58, the JSE Main Index rallied 796.94 points to end at 337,795.57, the Junior Market lost 19.95 points to end at 3,940.47 and the JSE US dollar market popped 0.51 points to close at 223.44.
The market’s PE ratio ended at 23 based on 2021-22 earnings and 13.9 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.

 

Image Plus surge in profits

Following a big surge in revenues and profit for the year to February 2022, Image Plus Consultants with revenues climbing 27 percent to $777 million and profit surging 298 percent to $94 million after tax, the company is now reporting continuing solid performance for the nine months to November.

Revenues climbed 27 percent in the November quarter to $248 million and 43 percent in the nine months to $803 million while profit rose moderately to $24 million from $22 million in 2021 for the last quarter.  The 2022 quarterly results would be about 50 percent better than the outturn for the 2021 period, being saddled with added costs that were not incurred in 2021, with expected credit loss expense of $6 million with none in 2021 and higher finance cost of $8 million up from $1.8 million. For the nine months, profit nearly tripled that of 2021 to reach $148 million.
It is unclear whether earnings reflect the elevated payment of directors’ fees or not. The change in cost year over year does not suggest that in which case profit for the new period would jump sharply when that cost amounting to some $15 million per quarter falls away. Costs of sales rose 25.5 percent to $82.8 million in the latest quarter, from $66 million in 2021, for the nine months, the increase is 42 percent to $274 million from $192 million, with both the quarterly and nine months cost tracking close to the increased revenues, which is a positive development.
Administrative expenses rose 21.6 percent to $113 million from $93 million for the quarter and 12.7 percent for the nine months to $297 million from $264 million in 2021. Depreciation charges were flat in the quarter at $13 million but up to $32 million from $29 for the nine months.Dr Karlene McDonnough – Chairman of Image Consultants Ltd. The company originally reported incorrect earnings per share for the periods with the use of an incorrect number of shares in the computation but that has since been amended with a new release.  Earnings per share for the quarter is 2.3 cents and 15 cents for the nine months.

Dr Karlene McDonnough – Chairman of Image Consultants Ltd.

“The rate of revenue growth slowed somewhat since the second quarter as a result of the Ocho Rios relocation exercise (all operations at that branch were closed for four days whilst CT and Xray services were down for an additional seven days when the branch reopened as we awaited relocation of the 3 phase power supply required to operate these units). Management is confident that the move and resulting downtime is an investment that will redound significantly to the benefit of all stakeholders in the months ahead” the chairman and the Managing directors advised shareholders in their commentary accompanying the financials and went on to say.
“Despite this downtime, the company’s case count remains very healthy at 40,949 representing year to date, an increase of over 17 percent compared to the comparative period in the prior year. The number of cases at nine months represents 88.3 percent of the full financial year 21/22 case count.  Expenses grew 12.7 percent over the last financial year driven by higher than normal costs in Q3. In the main, these costs were associated with one off marketing expenditure for the re-printing of all billboards, directional and office signs for the Ocho Rios branch. Traditionally too, Q3 costs are expected to be a little higher as we have expenditure associated with referring physician appreciation and end of year performance incentives for our team members.”
Cash flow generated by operations was $138 million, acquisition of fixed assets amounting to $143 million utilized it all, in addition, $30 million was placed in investments and $30 million was used to pay dividends that were partially funded from net loan proceeds that brought in $51 million.
At the end of November, long term borrowings stood at $118 million and short term at just $4 million. Current assets ended the period at $311 million including trade and other receivables of $242 million, up from $106 million in 2021, while cash funds and investments ended at $49 million. Current liabilities ended the period at $124 million. Net current assets amount to $200 million.
November ended with shareholders’ equity of $415 million but is expected to hit the $900 million mark with the proceeds of the recent public share issue.
The stock that fell to a low of $1.77 last week, traded over $2 since this week.

Another day of slippage for JSE Markets

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All markets of the Jamaica Stock Exchange dropped on Thursday, continuing the losses on Wednesday, following slippage in trading in the overall market compared with the prior day.
Trading ended with an exchange of 11,852,477 shares, down from 19,398,419 units on Wednesday, valued at $51.7 million down from $95.1 million on the previous day. Trading on the JSE USD market resulted in investors exchanging US$12,989 compared with US$19,364 on Wednesday.
At the close, the Combined Market Index dropped 1,059.23 points to 350,729.51, the All Jamaican Composite Index shed 1,290.43 points to end at 380,641.76, the JSE Main Index fell 784.27 points to 336,998.63, the Junior Market fell 35.38 points to 3,960.42 and the JSE US dollar market slipped 0.54 points to close at 222.93.
The market’s PE ratio ended at 23.1 based on 2021-22 earnings and 13.8 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.

 

All JSE Markets fall on Wednesday

All markets of the Jamaica Stock Exchange dropped on Wednesday at the start of a new month as is now the monthly norm, following slippage in trading in the overall market.
Trading ended with an exchange of 19,398,419 shares down from 34,401,378 units on Tuesday, valued at $95.1 million down from $183.6 million on the previous day. Trading on the JSE USD market resulted in investors trading US$19,364 down from US$37,070 on Tuesday.
At the close, the Combined Market Index dropped 2,950.37 points to 351,788.74, the All Jamaican Composite Index dived 3,399.97 points to close at 381,932.19, the JSE Main Market Index shed 2,544.43 points to 337,782.90, the Junior Market dropped 62.44 points to 3,995.80 and the JSE US dollar market slipped 1.96 points to close at 223.47.
The market’s PE ratio ended at 22.9 based on 2021-22 earnings and 13.9 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.

Big bounce for Junior Market on Tuesday

The Junior Market of the Jamaica Stock Exchange surged sharply to close out the first month of 2023 positively and the JSE USD index climbed on top of Monday’s strong gains but the Main Market fell back to remain negative for the year to date.
Trading ended with an exchange of 34,401,378 shares up from 33,340,369 units on Monday, valued at $183.6 million versus $357.1 million on the previous day. Trading on the JSE USD market resulted in investors trading US$37,070 versus US$267,767 on Monday.
At the close, the Combined Market Index rose 532.70 points to close at 354,739.11, while the  All Jamaican Composite Index dipped 405.49 points to 385,332.16, the JSE Main Market Index fell 335.82 points to 340,327.33, the Junior Market jumped 91.02 points to 4,058.24 and the JSE US dollar market climbed 6.36 points to close at 225.43.
The market’s PE ratio ended at 23 based on 2021-22 earnings and 14 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.

Bounce for all of JSE markets on Monday

The JSE USD index surged on Monday while the Junior Market of the Jamaica Stock Exchange put in another solid run as the Main Market also bounced moderately over Friday’s close to start off the week on a positive note with the volume and value of stocks traded jumped well over Friday’s trade.
Trading accounted for 33,340,369 shares up from 21,991,278 units on Friday, valued at $357.1 million up from $203.3 million on the previous day. Trading on the JSE USD market resulted in investors trading US$267,767 versus US$7,760 on Friday.
At the close, the Combined Market Index rose 592.92 points to close at 354,206.41, the All Jamaican Composite Index rallied 1,098.53 points to 385,737.65, the JSE Main Index advanced 345.65 points to end at 340,663.15, the Junior Market gained 29.17 points, on top of the 53.99 points rise on Friday, in finishing at 3,967.22 and the JSE US dollar market surged 11 percent with the addition of 20.91 points to close at 219.07.
The market’s PE ratio ended at 22.9 based on 2021-22 earnings and 13.8 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.

 

Why accountants cant compute earnings per share?

The latest company to get the computation of earnings per share wrong is the last to list on the Jamaica Stock Exchange, but it is not the only one that has accountants and auditors that cannot compute earnings per share properly. The other most recent listing got it terribly wrong, not only did this happen for the interim accounts, most likely produced internally but the audited report had the wrong computation as well.

Dr. Karlene McDonnough – Chairman of Image Consultants Ltd.

The correct computation of earnings per share is so critical, with investors using it to value shares of companies. A wrong calculation can result in distorted valuation by investors placed on a stock and it only needs to be in the marketplace for a few days for enormous potential damage to be done.
The Jamaica Stock Exchange in publishing reports with woefully inaccurate earnings per share figures should place a bold note with the release of the results that there is an error in the EPS so that all investors can be aware of it upfront. This approach is recommended rather than waiting for the company to re-compute it as the release of profits is also of much import to the market. this will require a different approach by the JSE than the current practice.
Image Plus Consultants which was listed just over a week ago reported a strong increase in revenues and profits but spoilt it by reporting excessively overstated earnings per share as they used the incorrect number of shares in the computation. Rather than 29 cents per share for the quarter and $1.84, it reported the computation is 2.3 cents and 15 cents for the nine months. One on One Education did the same thing for both their audited accounts and the first quarter results, both of which were corrected this past week after it was in the public domain for several days before the revision. This publication has been critical of the boards of both companies. The latest error shows the lack of experience on behalf of the board members as well as their accountant and the stock exchange must share the blame as well.

Ricardo Allen CEO of One to One

It is one thing for a company to get the computation wrong, it is an entirely different issue for auditors to do the same. The problem is that on too many occasions this error is cropping up and the situation seems to get worse as the Junior Market listings grow.
Stock splits or stock bonuses do not result in averaging shares issued. All that is needed in such cases is to use the new number of shares in computing EPS and all past periods are to be adjusted likewise. Only when new shares are issued for a consideration of value that the time weighted average number of shares would be used.
We have written on more than one occasion that investors in Jamaica are not properly protected, the above errors are just some of the matters that need to be addressed, but like the Stocks and Securities issue and others similar, those in authority fail to move with alacrity in correcting the fault.

A Lasco company exists ICTOP10

The Jamaica stock market continues to consolidate, awaiting a dynamic development to push it decisively in one direction or another as the Bank of Jamaica quietly tightened the money supply further in January, drying up buying power in the short run. The first big likely move is unlikely to be a reduction of interest rates which is seemingly set to occur in the second quarter, but the reporting of substantially increased profits to flow from some companies.
Tropical Battery returns to the ICTOP10 list for this week with projected earnings of 30 cents for the current year, up from 15 cents last fiscal year and replaces Lasco Manufacturing which dropped out with a rise in price during the week as the supply of the stock has drooped sharply recently, with just 11 offers to sell now in the system.
Image Plus Consultants reported nine months results with revenues rising 27 percent in the November quarter to $248 million and 43 percent in the nine months to $803 million, while profit  rose moderately to $24 million from $22 million in 2021 and for the nine months profits nearly tripled that of 2021 to reach $148 million. The company reported incorrect earnings per share for the periods, using the incorrect number of shares. As a result, rather than 29 cents per share for the quarter and $1.84, it is 2.3 cents and 15 cents for the nine months. Regardless, the stock is cheap based on these earnings and those to come.
Honey Bun rose 10 percent to $7.69, with the December quarter results due any time now, Lasco Financial gained 9 percent to $2.84 and Lasco Manufacturing gained 5 percent to $4.79. General Accident rallied 6 percent to $4.99. Image Plus Consultants entered the ICTOP10 after just one day of trading and fell to a low of $1.86 during the past week before rebounding to close this past week with a fall of 12 percent to $1.93, Caribbean Assurance Brokers lost 6 percent of its value to close at $2 and Paramount Trading fell 5 percent to $2.10.
All other movements in the Junior Market TOP10 were 3 percent or less. The Main Market Berger Paints popped 12 percent to $10.60, followed by a 9 percent rise for Jamaica Broilers to close at $31.50 and Guardian Holdings with a gain of 4 percent to $535. There were no notable losses.
At the end of the week, the average PE for the JSE Main Market TOP10 is 5.6, well below the market average of 15, while the Junior Market Top 10 PE sits at 6.5 versus the market at 12.6, critical indicators of the level of the undervaluation of the ICTOP10 stocks currently. The Junior Market is projected to rise by 211 percent and the Main Market TOP10 by an average of 274 percent to May this year. The primary concern for the Main Market achieving such gains by May is that the list is dominated by financial companies that are out of favour and may need to see the summer months before the full interest of investor start to show.
The Junior Market has 15 stocks representing 31 percent of the market, with PEs from 15 to 29, averaging 21 compared with the above average of the market. The top half of the market has an average PE of 18, with prices of Fosrich and Future Energy adjusting downwards closer to the average of the TOP15. The above average shows the extent of potential gains for the TOP 10 stocks. The situation in the Main Market is similar, with the 18 highest valued stocks priced at a PE of 15 to 116, with an average of 27 and 20 excluding the highest valued stocks and 27 for the top half excluding the highest valued stock.
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.

 

 

 

Prices rebound on the JSE markets

The Junior Market of the Jamaica Stock Exchange markets surged on Friday while the Main Market bounced moderately over Thursday’s close, even as the price of thinly traded Palace Amusement dropped $645, and the JSE USD market edged slightly lower.  
Trading ended, with an exchange of 21,991,278 shares compared with 29,715,470 units on Thursday, with a value of $203.3 million down from $285.4 million on the previous day. Trading on the JSE USD market resulted in investors exchanging US$7,760 versus US$36,261 on Thursday.
At the close, the Combined Market Index jumped 2,334.51 points to 353,613.49, the All Jamaican Composite Index rallied 1,622.56 points to 384,639.12, the JSE Main Index climbed 1,967.53 points to end at 340,317.50, the Junior Market Index climbed 53.99 points to 3,938.05 and the JSE US dollar market popped 1.30 points to close at 198.16.
The market’s PE ratio ended at 22.3 based on 2021-22 earnings and 13.7 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.