By Dipo Olowookere
Analysts at Greenwich Merchant Bank have placed sell rating on the shares of Nestle Nigeria and Nigerian Breweries.
However, they put a buy rating on Ecobank, Zenith Bank, FBN Holdings and UBA, while GTBank, Cadbury Nigeria, PZ Cussons, Guinness Nigeria and Unilever Nigeria all have hold rating.
In a report released over the weekend, the firm said Nestle, which has traded as low as N764.90 per unit in the last one year and as high as N1,505.00 per unit, can be sold by holders at the present value of N1,350 because it has surpassed the target price of N963.87.
The company further said Nigerian Breweries, which had a target price of N43.57, can be offloaded now that it is selling at N49.50.
For Ecobank, it said investors can buy at the current value of N5 because it has a 12-month target price of N14.51, while Zenith Bank could reach N31.26, higher than the present N25.30.
It further said FBN Holdings and UBA have the tendency to reach N13.06 and N12.55 respectively, higher than the current respective price of N7.10 and N7.95.
Greenwich also said investors with GTBank could still hold the stocks because it has the tendency to sell at N32.75, while Cadbury Nigeria, PZ Cussons, Guinness Nigeria and Unilever Nigeria could sell for N9.26, %.77, N21.19 and N13.60 respectively.
Meanwhile, the company said the dampened sentiments may likely continue as a result of “the rising yields in the fixed income space.”
“In the new week, we expect the market sentiment to remain weak, although we do not rule out the possibility of an uptick by the end of the week,” it projected.
At the fixed income market, Greenwich said news that the Central Bank of Nigeria (CBN) was planning to phase-out the participation of international players in the OMO-bill market caused some investors to selloffs their holdings.
The CBN, however, debunked the information and the average yield closed flat at 5.6 per cent.
This week, the firm expects “market players to continue to trade cautiously with mixed sentiment across the curve while seeking opportunities to cherry-pick higher-yielding papers across the curve.”
Adedapo Adesanya