|Investors are finding their decisions reeling from the effects the half-year results that are streaming in from various listed companies. And with every company registering an increase in profits, one is left pondering about which stocks to pick. NIC Bank has hit an all time high of Kshs159 after it nudged investors with a bonus issue to sweeten its rights issue. The stock now is as good as well priced. However, it’s a good long-term buy as the bank diversifies its non-funded revenue streams by rejuvenating its investment-banking arm, NIC Capital. This is given backing by a rights issue that’s is in the offing, in which it plans to raise Kshs1.2 billion to power its expansion.
You might consider acquiring a piece of Diamond Trust Bank (Kenya), which has just rebranded, as it’s set to hit the psychologically important Kshs1 billion profit threshold at the end of the financial year. Currently retailing at Kshs96 per share, its liquidity is average.
With a forward Price Earnings ratio of (P/E) is 22.20 times, an indicator of when investors expect to recoup their investments, it’s a quality stock. But with the market completely distorted by a large number of retail investors, be wise by keeping your options open. DTB (K) has strong fundamentals as it is already making inroads into asset financing and personal loans business
The fact that it has a regional presence in Uganda and Tanzania should guarantee investors much upside in terms of returns. Barclays Bank is no longer a darling for those wanting to get a piece of the dividends after the former high dividend paying blue-chip revised its dividend policy downwards to fund its expansion.
Scangroup has an acquisition-savvy managing director in the name of Bharat Thakrar. The firm is spreading its tentacles not just in East and Central Africa but also in West Africa, with a target of entering Nigeria in the last quarter of this year. It will surely benefit from the benign economic outlook in these regions as corporations shore up their advertising budgets.
Things are getting better for it after it reported an increase of 30 percent in its half-year ending June 30, 2007 results to Kshs116.6 million. Billings by the advertising and public relations firm grew 54 percent. The company is lowly leveraged i.e. its level of debts are low hence its debt servicing obligations, which might tie it down are few.
|Mr Theuri is an Independent Financial Adviser, British American Asset Managers. Email: Theuri3@yahoo.com
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