Zenith Bank Stock Resists Further Decline, As Earnings Expectations, Prospects Rise

Zenith Bank is tracking the rebound of the overall Nigerian banking industry, after a year of impressive earnings performance as revealed by its quarterly numbers, especially with its trade below the shortest moving average of 20-Day and almost at the oversold region to signal a reversal. The stock started its recent rally towards the end of 2019, which placed it in a buy range on a rebound from the support level of N18.50 to N19.00 on the expected full-year earnings report, being Nigeria’s most profitable bank. The stock is set to rebound and breakout its recent resistance level of N23 on a consistent track record of growing quarterly and full-year numbers. This has supported its high dividend payout making it the number one income stock to look at, given its current price and yield that is higher than money market rates and the yields of sovereign and corporate bonds.
There is tremendous potential for banking stocks and indeed the nation’s stock market, with a recovery in sight in the coming weeks and months, following which it is a good time to add the bank’s shares to your portfolio for the short, medium and long-term as the stock is ready to reverse up after this downtrend, given that it had resisted decline at N18.90 per share.
Because there is no doubt about the bank’s profit potential and its significantly bright prospects, investors need to closely monitor its performance to determine at what point it starts rallying as the market settles down.
According to Zenith Bank’s historical data, its average dividend payout ratio over the last five years has been 50.25%, even as its full-year earnings per share is projected at N5.47 each. The expected final dividend for 2019 is projected to be in the region of between N2.55 and N2.65 on a price to earnings ratio of 4.34x.
This was discussed extensively as part of the 10 golden stocks during the Invest 2020 Traders & Investors Summit held in Lagos last December.
Also, traders and investors need to change their strategies, because of the NSE’s pricing methodology, the CBN directives and their impact on the economy in the nearest future.
Meanwhile, the Investdata team welcomes you to a bullish 2020. The home study packs of Invest 2020 Opportunities and Trade Ideas Summit containing the 10 Golden Stocks for 2020 are available. To obtain your pack send ‘Yes’ or ‘Stock’ to 08028164085, 08032055467, 08111811223 now.

Ambrose Omordion
CRO|Investdata Consulting Ltd
info@investdataonline.com
info@investdata.com.ng
ambrose.o@investdataonline.com
ambroseconsultants@yahoo.com
Tel: 08028164085, 08032055467

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