We digest, analyze and do a ItsMoneyMark Hot Take on the burning stocks in the Market! Enjoy our ItsMoneyMark audiocast.
*These opinions and thoughts are solely of ItsMoneyMark and does not constitute investment advice. Ensure to always speak to a Licensed Financial Advisor.
On this Hot Take Episode, as the Earnings Numbers come out for a number of JSE, Jamaica Stock Exchange companies, it is always a great time to re-examine the price-to-earnings (P/E) ratio of listed companies. Especially, the ones continuing to demonstrate outsized “G” rates, that is, earnings growth rates. We look at 3 stocks on this episode of Hot Take on ItsMoneyMark that are jumping out to us: Honey Bun (1982) Limited, crushed their 1st quarter earnings + 50%, with Earnings per Share hitting J$ 15 cents and Net Profit of J$ 69.2 million, on Revenue of J$ 817.4 million. HONBUN’s share price is trading around J$ 7.50, with its 52-week high, at J$ 10.30. Its coming quarters are typically even stronger for HONBUN, and with these Q1 results annualized and potential growth with HONBUN’s innovation, new products and organic growth, HONBUN’s P/E could well be at 11x – 12.5x. Fontana Limited, saw almost identical growth patterns, in its 2nd Quarter and 6 months results – 30% in Q2 and 32% in the 6 months numbers respectively. Earnings per Share of J$ 33 cents, or Net Profit of J$ 411 million for FTNA for its half year numbers, ending December 31, 2022. Since the results, the share price has rallied a bit, and trades just below J$ 9. If FTNA can continue with this 2nd Quarter earnings growth plus get some legs in the 2nd half of the year, its P/E could be around 10x – 11x. FESCO, is one of those stocks that doesn’t necessarily throw out the textbook on P/E ratios, but if you only use it as a benchmark, meaning as a “number, in terms of this is cheap or expensive, then FESCO will be an issue for you.” FESCO traditionally, or a benchmark may seem to be an expensive P/E, but in fact, its “G” rate has been explosive again this quarter. FESCO is trading just below J$ 5/ share, and saw its 3rd quarter, year over year earnings + 108%, and YTD 9 months, + 155%. FESCO’s 9 months Earnings per Share are at J$ 0.1738, and its P/E could well be around 17x – 19x. Reality versus textbook – FESCO is consistently doubling its earnings or 100% + growth rate in most of its reports.
On this Hot Take Episode, NCB Financial Group Limited Hits J$ 75/ share. We are not giving up on NCB FG just yet, although many will be jumping off the ship, due to, (i) lack of dividends, (ii) the recent quarterly earnings collapse, and (iii) as always other potential reasons when it comes to a stock, etc. We had mentioned before, NCB FG could hit 1/3 of its all-time high as it gets it act together and gets rolling again. So, anything around J$ 83 was a good look. We even said, look even within a 10% band, seems like something special over the long-haul if you can be patient. We are now around 10% below that mid-80 price level, and the energy, vibe, gut feeling of that time NCB FG, went from roughly J$ 36 to J$ 12 (on or around that timeline of the 2008/2009 financial crisis and ensuing years) and so forth, is creeping back even more into our memory cells seeing J$ 75. Similar to way back then, the bounce back of NCB FG, was not immediate and do not expect it to immediate this time either, but there is even more value in NCB FG at J$ 75, as the market cap of NCB FG potentially even re-approaches US$ 1 billion.
Happy New Year from ItsMoneyMark! Remember, don’t focus on projections, predictions, and what asset class to buy. Let’s focus on either getting started on your journey, or continuing to do what is yielding you those wins. We are here, to make 2023 Big, and Great for you and with you! On today’s ItsMoneyMark Hot Take, we are going to zoom in on Victoria Mutual Investments Limited, VMIL and their next major move in making Kingston Properties Limited, KPREIT now, an associate company. VMIL increased their equity stake in KPREIT to 23%, surging above the 20% threshold. Resulting impact we speak about and to take into account, is VMIL will now report a share of profit moving forward in 2023, as announced effective December 30, 2022. We jump into Barita Investments Limited, BIL, and another Bigly Executive Announcement made by BIL to kick things into gear for 2023. What a way to start 2023 with a Bang. Big financial industry, sector name, Mr. Damion Brown joins Barita in the role of Chief Investment Strategist and CEO, Real Estate and Alternative Investments at Cornerstone United Holdings Jamaica Limited, an affiliate of Barita, effective November 28, 2022.
On this Hot Take Episode, looking at the JSE Mains for a Change, Don’t Sleep on these low P/Es – price-to-earnings ratios, with these companies showing above average earnings growth rates. The Trifecta special, all trading below 10x P/E ratios, Jamaica Broilers Group, NCB Financial Group and Scotia Group Jamaica.
On this Hot Take Episode, on NCB Financial Group the share price has hit a new 52-week low recently of J$ 80 in the markets, and has bounced to J$ 85. Recent series of events at NCB Financial Group: (a) Last earnings reported for Q3 and 9 Months to June 30, 2022, EPS of J$ 8.11, Net Profit of J$ 18.64 billion, (b) No dividend declared at board meeting on August 4, 2022, (c) Q3 EPS alone of J$ 3.57, (d) Subsidiary NCB Bank Jamaica completes US$ 300 MM securitization credit card deal on August 30, 2022, and (e) Mr. Ian Chinapoo becomes CEO of GHL, effective October 1, 2022. NCB FG has 2 important dates coming up. Board of Directors meeting and their 4th quarter investors’ briefing, respectively, to hit the market on November 10, 2022, and November 11, 2022. Despite the robust earnings in Q3, the stock has fallen out of favour with investors due to lack of ordinary dividends and/ or guidance there, this seems to be the key for the November 11, 2022, meeting, and transparency or guidance around this for minority shareholders and NCB FG investor relations.
On this Hot Take Episode, we feature Jamaica Broilers Group Limited (JSE: JBG) as they reported a record breaking, JSE – Jamaica Stock Exchange shattering First Quarter (Q1). JBG’s share price surprisingly has not jumped, or moved much or at all, since the earnings number from the Chicken King, the Chicken Boss of Jamaica, released its numbers on September 8, 2022, almost a month ago. JBG has been trading between J$ 27 – J$ 29 per share approximately since the Earnings Beat. By the numbers, Broilers, as JBG is popularly called in the Markets crushed the Earnings Report Quarter. For the period ended July 30, 2022, Revenue of J$ 22.9 billion versus J$ 17.6 billion, an increase of + 30% year over year. Even more impressive, Net Profit rang the cash register at J$ 1.06 billion, versus J$ 275.4 million, year over year. JBG’s earnings per share for Q1 2022/ 2023 way surpassed our expectations by hitting J$ 1.07/ share versus J$ 0.29/ share, + 269%.