INVESTDATA WEEKLY STOCK PICKS

The successful transition of power from one government to another is a plus for the nation economy and the market no matter how gloomy the situation may be today. Political stability is the driver for economic development and growth of any nation of the world expect the economy to move forward with the new government reforms and commitment to bring the change.  Despite the seeming lack of direction of the market in the formation of a continuation pennant pattern signaling accumulation by market players waiting for a breakout or down. The NSE Composite index looks stable. It has consistently held above its 50-day moving average, now at 34,310.37 with strong volume as advancers outnumbered decliners in the ratio 38 to 31. The market capitalization closed at N11.67 trillion. 

NSE ASI

Despite the slowdown of momentum after the reversal during the week, following the pullback on the last trading day. But stochastic Oscillator and CCI are signaling reversal imminent as relative strength index of the market is 52.56. Bollinger Bands are 81.69% narrower than normal.  The narrow width of the bands suggests low volatility as compared to NSEASI's normal range.  Therefore, the probability of volatility increasing with a sharp move has increased for the near-term. This suggest that traders and investors should hold position and watch the general market trend.

STOCKS TO TRADE

AFRICA PRUDENTIAL REGISTRAR PLC (AFRIPRUD)

Africa Prudential Registrars Plc is a potent business unit which successfully weathered the inclement financial environment of the past, while still waxing strong and being in contention for the leading Registrar firm in Nigeria.   The company has demonstrated strength in keeping share registration data for companies and since it got listed on the floor of Nigeria Stock Exchange. It has consistently posted strong earnings that had supported dividend payout. Its earnings and assets are robust to support its share price going forward as the company free cash flow support operations due to the nature of its service products. 

Company Figures                                 

Share Data	Ratio Analysis
Market Cap: N6.20 Billion	Net Assets per share:N2.45
Net Assets: N4.90 Billion	Price/Book Value:  1.16
Shares Outstanding: 2 Billion	ROE: 7.62%
Current Price: N3.10	Div. Yield: 11.29 %
52-Weeks High/Low N3.57/N2.30	Q1 EPS: 0.19
Year High/Low N3.57/N2.30	Current PE ratio: 4.07

Source NSE,Coy&InvestData Research                                 

AFRICA PRUDENTIAL Chart

The chart above revealed that the stock had been trending up for a period more than two months, before a pullback that recently formed a continuation symmetrical triangle pattern which has broken the resistance level at N2.99 to usher in a new rally.  Reversal have been confirm by the following indicators CCI, Chaikin Money flow and MACD signals. The current value of RSI 63.75. As the stock retrace toward the first green resistance line, which would give a return of 3.32 per cent. The second target is the red resistance level, which would give a return of 6.45 per cent. The third target which is the yellow resistance line with expected return of 11.29 per cent. The last resistance level which is at N4.00 is expected to give return of 29.03 percent if the Q2 beat market expectation. 
Any breakdown below the support level at N2.80 and a stop loss of 30kobo which is anything not below N2.80 so that your capital can be protected.

ACCESS BANK PLC (ACCESS)
This is a one shop financial institution that is into commercial banking, investment banking and securities trading with strong corporate, retail and investment banking products that are driving the impressive numbers being posted. Regardless of all the factors militating against the banking sector, its earnings are robust to support its share price for upside potential and with expected interim dividend in the nearest future. The bank share price had suffered as it trades at discount with high margin of safety.

Company Figures                                 

Share Data	Ratio Analysis
Market Cap: N142.56Billion	Net Assets per share:N12.81
Net Assets: N293.21 Billion	Price/Book Value:  0.47
Shares Outstanding: 22.88 Billion	ROE: 15%
Current Price: N6.23	Div Yield:10.00%
52-Weeks High/Low N10.18/N4.50	Q1 EPS: 0.60
Year High/Low N7.02/N4.50	PE ratio: 2.64

Source NSE,Coy&InvestData Research                                 

ACCESS BANK Chart

Looking at the chart you can see that the stock had been trending up for a period of five months making higher highs to recently forming a continuation symmetrical triangle pattern with multiple bottoms at the green line support level. The stock had pullback as it was adjusted for dividend and down to the support price at N5.99. It is currently side trending with upward reversal imminent as signaled by MACD and RSI is below 50 currently at 48.92 level. The technical aspects of the chart are still compelling. These include a strong pattern of accumulation as its awaiting a mark-up.  As we expect the stock to retrace at this point to the first orange resistance line, which would give a return of 5.62 percent. The 2nd target is the blue resistance level, which would give a return of 15.25 percent, and the third target which is the yellow resistance line with expected return of 28.41 percent.As before, investors who purchase shares to hold could be well rewarded in the long term. Any further breakdown below the last support level at N5.73 and a stop loss of 50 kobo which is anything not below N5.73 so that your capital can be protected from further loss. The upside potential of this stock is huge watch it.

OANDO PLC (OANDO)

Oando is the largest integrated energy solution in Africa and a holding company within its group. Its business is organised into six division operating in the downstream, mid-stream and upstream of its industry. Also carrying out business in marketing, supply & trading, terminal & logistic, gas & power, energy service and exploration & production.

The company's strategy to increase its presence in the mid-stream and upstream led to the acquisition of ConocoPhillips business in Nigeria to boost profitability level.

Company Figures                                 

Share Data	Ratio Analysis
Market Cap: N171.61 Billion	Net Assets per share:N23.70
Net Assets: N215.28 Billion	Price/Book Value:  0.76
Shares Outstanding: 9.08 Billion	ROE: 4.97%
Current Price: N18.90	Div Yield:5.51%
52-Weeks High/Low N36.89/N13.18	Q3 EPS: 1.17
Year High/Low N18.40/N12.83	Current PE ratio: 5.33

Source NSE, Coy &InvestData Research

OANDO Chart

Looking at the chart you can see that the stock came down gradually with the oil price before the major market correction that kept the southward movement to a support level of N12.83.But it recently reversed to form cup and handle pattern with a bullish channel.  As MACD confirm reversal with RSI value at 61.57, we expect the stock to sustain this up-trend to the first yellow resistance line at N19.96 to give a return of 5.61 per cent. The second target is the black resistance level, which would give a return of 15.34 per cent and the third target is the orange resistance line with expected return of 25.40 per cent.
The last green resistance line would give a return of 40.02 percent. Any breakdown below the new support level and red line at N17.40 and a stop loss of N1.50which is anything not below N17.40 to protect your capital from further loss.  The upside potential of this stock is high because of the company closeness to the new government and expansion for long term investors. It may also take shorter period for it to recover if the company's earnings beat market expectation.

FLOUR MILLS NIG. PLC. (FLOURMILL)
This company is into manufacturing and distribution of consumer staple products. Yes, it has been consistent in paying dividends but the payout has been up and down to reflect the earnings position of the company at a given time. The dwindling earnings of the company had further depressed its share price as dividends are low compared with the market value coupled with the bearish market is battling with.

Company Figures                                 

Share Data	Ratio Analysis
Market Cap: N95.57 Billion	Net Assets per share:N30.52
Net Assets: N80.08 Billion	Price/Book Value:  0.89
Shares Outstanding: 2.64 Billion	ROE: 4%
Current Price: N36.20	ROA: 1.01%
52-Weeks High/Low N75/N26.60	Q3 EPS: 1.26
Year High/Low N39.80/N26	Current PE ratio: 9.48

Source NSE, Coy &InvestData Research

Flour mills Chart

Looking at the chart you can see that the stock has been trending lower for a long time to five years low of N26.60 with bullish ‘’V’’ after it had broken many support levels, where it reversed to usher in a side trending for a long time now. Traders and investors are to take to advantage of the confirmed reversal by MACD at the current price of N34.85 anything below makes the stock more attractive with high upside potential as the market expects its financials where the sale of assets will impact bottom line. The stock has just started retracing back to the first green resistance line, which would give a return of 9.94 per cent. The second target is the yellow resistance level after that, which would give a return of 20.69 per cent, the third target is the orange resistance level that would give a return of 38.12 per cent and the fourth target which is the last red resistance line with expected return of 69.60 per cent. Any breakdown below the support price N32.67 and a stop loss of N3.50 which is not below N32.67 so that your capital can be preserved.

Conclusion

We expect the market to positively embrace the incoming government as the smooth transition has impacted on the nation democracy to drive economic growth and development going forward. The economic reform policies of this government will sharp the market going forward especially in the second half of the year. As the market expect the monetary and fiscal policy to work together to drive the nation economy.