Dangote cement

[knightofdelta]

Originally Posted by paddylo

Dangote Cement is trading at N150 a share. .Kaching, thats the sound of money in ma bank, hmmn.

This is fair value for me, until third qtr of 2013.

Cheers

A few figures to see how well Dangote cement has done since listing on October 26, 2010.

Index value

Start: 24973.38
End: 31446.22
Total return: 25.9%
Annualized return: 10.8%

Nestle

Start: 387.95
End: 750.1
Return: 93.3%
Annualized return: 34.1%

Guaranty

Start: 16.6
End: 24.5
Return: 47.6%
Annualized return: 18.9%

NB

Start: 76.5
End: 153.99
Return: 101.3%
Annualized return: 36.5%

Dangcem

Start: 135
End: 150
Return: 11.1%
Annualized return: 4.8%

Inflation

Average inflation rate over the past 6 years : 10.7%

Dangote cement historical dividend yield cannot hold a candle to the average market dividend yield. If corporate actions were introduced into the small analysis, the contrast would have been more. A little assumption that was made here is that all dividends and bonuses were donated to the KOD Foundation.

If you are still very happy to have bought Dangote cement, I wish you Good luck.

Cheers.

[hispy99]

Originally Posted by paddylo

Dangote Cement is trading at N150 a share. .Kaching, thats the sound of money in ma bank, hmmn.

This is fair value for me, until third qtr of 2013.

Cheers

bros, i hope u know say quite a few stocks have done kaching raised to power 10, whilc Dangote Cement has only done it once

anyway, enjoy your loot, just remember us sha....

[paddylo]

Originally Posted by knightofdelta

A few figures to see how well Dangote cement has done since listing on October 26, 2010.

Index value

Start: 24973.38
End: 31446.22
Total return: 25.9%
Annualized return: 10.8%

Nestle

Start: 387.95
End: 750.1
Return: 93.3%
Annualized return: 34.1%

Guaranty

Start: 16.6
End: 24.5
Return: 47.6%
Annualized return: 18.9%

NB

Start: 76.5
End: 153.99
Return: 101.3%
Annualized return: 36.5%

Dangcem

Start: 135
End: 150
Return: 11.1%
Annualized return: 4.8%

Inflation

Average inflation rate over the past 6 years : 10.7%

Dangote cement historical dividend yield cannot hold a candle to the average market dividend yield. If corporate actions were introduced into the small analysis, the contrast would have been more. A little assumption that was made here is that all dividends and bonuses were donated to the KOD Foundation.

If you are still very happy to have bought Dangote cement, I wish you Good luck.

Cheers.

Thats a disingenuos analysis, i hav been buying DANGCEM continuously even as it dipped to N100 a share. .the stock is up 41 percent in the past year.

Bottom line is that DANGCEM is a blue chip Naija company that is valued at about $16 billion dollars, which is what i am comfortable with.

I have no patience for these penny stocks (dollar wise) trading on the NSE.

I have actively traded Mastercard, Visa, IBM, etc with valuations of $50 billion and above.

So pardon me if i am not interested in owning a ikeja hotel or any stock valued below N500 bn.

Cheers

[Babs_O]

Originally Posted by paddylo

Thats a disingenuos analysis, i hav been buying DANGCEM continuously even as it dipped to N100 a share. .the stock is up 41 percent in the past year.

Bottom line is that DANGCEM is a blue chip Naija company that is valued at about $16 billion dollars, which is what i am comfortable with.

I have no patience for these penny stocks (dollar wise) trading on the NSE.

I have actively traded Mastercard, Visa, IBM, etc with valuations of $50 billion and above.

So pardon me if i am not interested in owning a ikeja hotel or any stock valued below N500 bn.

Cheers

On the NSE many companies surpass DANGCEM in transaction value in 2012.
DANGCEM = N 10.1 b
OANDO = 11.0 b
FCMB = N 11.5 b
NESTLE = N 22.5 b
UBA = N 28.2 b
FBNH = N 65.1 b
NB = N 68.7 b
GTB = N 72.9 b

So what is so great DANGCEM capitalisation when it doesn't lift transaction value.

[hispy99]

Originally Posted by Babs_O

On the NSE many companies surpass DANGCEM in transaction value in 2012.
DANGCEM = N 10.1 b
OANDO = 11.0 b
FCMB = N 11.5 b
NESTLE = N 22.5 b
UBA = N 28.2 b
FBNH = N 65.1 b
NB = N 68.7 b
GTB = N 72.9 b

So what is so great DANGCEM capitalisation when it doesn't lift transaction value.

All these other companies are not $16 billion companies

[nosa2]

Originally Posted by hispy99

All these other companies are not $16 billion companies

I think he means market cap.

[hispy99]

Originally Posted by nosa2

I think he means market cap.

yes, only Dangote Cement has $16B market cap, all other stocks are sub $16B, so not attractive to oga Paddy

[paddylo]

Originally Posted by hispy99

yes, only Dangote Cement has $16B market cap, all other stocks are sub $16B, so not attractive to oga Paddy

Every one has his investment style, so whats so hard to grasp about that?

Most fund managers in the west will not touch a stock trading below $5

Some only invest in mid caps etc.

If you go back to the beginning of this thread i have always maintained that DANGCEM is a long term bet for me, others claimed it was too expensive and they were waiting for it to hit N70/N80 before they buy, well they are still waiting.

If i am investing for the long haul, say 10 years i am more comfortable parking my money in a heavyweight large cap (Nigerian wise) stock like .

I actually also have NB and GTB in my portfolio. .the 2nd and 3rd stocks with the highest market cap on the NSE.

Everyone has their investment thesis, am not buying stocks for dividend income, i dont need it.

However with a $400 bn plus economy (after GDP rebasing), i believe certain stocks can grow to 5% 10% or even 20% of nominal GDP, like the Standard Banks, MTN, SAB miller in South Africa.

These companys that will grow will be the dominant names in the economy.

End of story.

[knightofdelta]

Originally Posted by paddylo

Every one has his investment style, so whats so hard to grasp about that?

Most fund managers in the west will not touch a stock trading below $5

Some only invest in mid caps etc.

If you go back to the beginning of this thread i have always maintained that DANGCEM is a long term bet for me, others claimed it was too expensive and they were waiting for it to hit N70/N80 before they buy, well they are still waiting.

If i am investing for the long haul, say 10 years i am more comfortable parking my money in a heavyweight large cap (Nigerian wise) stock like .

I actually also have NB and GTB in my portfolio. .the 2nd and 3rd stocks with the highest market cap on the NSE.

Everyone has their investment thesis, am not buying stocks for dividend income, i dont need it.

However with a $400 bn plus economy (after GDP rebasing), i believe certain stocks can grow to 5% 10% or even 20% of nominal GDP, like the Standard Banks, MTN, SAB miller in South Africa.

These companys that will grow will be the dominant names in the economy.

End of story.

What I have been able to gather from you.

1. You prefer large cap stocks
2. You must be an individual (personal) institutional investor whose trades move the market
3. You don't like risk (and I am sure you know risk drives return)

Enjoy yourself o and don't forget us when you start chopping isi ewu with your profits.

But remember that we will always be here to tackle you if you make Dangcem sound like one of the best things to have happened to stock investments in Nigeria. I made over 200% return in International breweries (one of those disgusting penny stocks in dollar terms) within two years and have also made over 100% returns in Diamond bank (another penny stock) in less than one year.

Well, I respect your strategy and your ability to stick with it. I realized that and that was why I compared your returns with that of other large cap stocks according to the NSE standards and not the likes of International breweries of DN Meyer. I am more of a mid-cap value stock investor and I am certainly not better than you as I know I will probably under-perform you if I wade into your terrain.

Good luck.

[afolabi27]

Originally Posted by knightofdelta

What I have been able to gather from you.

1. You prefer large cap stocks
2. You must be an individual (personal) institutional investor whose trades move the market
3. You don't like risk (and I am sure you know risk drives return)

Enjoy yourself o and don't forget us when you start chopping isi ewu with your profits.

But remember that we will always be here to tackle you if you make Dangcem sound like one of the best things to have happened to stock investments in Nigeria.

Please leave sir Paddilo alone, he is in a different league from you and most of us here.

My creditors will force me into bankruptcy if I don't make more than 40% in a full year playing my penny stocks.

Until recently, Skye bank constitute 60% of my portfolio and now I have Skyebank, CCNN, Eterna, ETI, Honeywell and NEM constituting more than 75% of existing portfolio.

I need Dangcem's current price to be divided by 3 to be tempting (note use of word) to someone like me.

I still have a long way to go, I need to take the risk, not yet time to do growth or overpriced stocks, I couldn't even buy GTB at current valuation.

And let me say I have achieved my profitability target for year 2013 already playing these penny stocks. I have set a revised new target representing 125% of previously achieved target.

But its all small money sha. Just #100k.

[goldsun2]

Originally Posted by afolabi27

Please leave sir Paddilo alone, he is in a different league from you and most of us here.

My creditors will force me into bankruptcy if I don't make more than 40% in a full year playing my penny stocks.

Until recently, Skye bank constitute 60% of my portfolio and now I have Skyebank, CCNN, Eterna, ETI, Honeywell and NEM constituting more than 75% of existing portfolio.

I need Dangcem's current price to be divided by 3 to be tempting (note use of word) to someone like me.

I still have a long way to go, I need to take the risk, not yet time to do growth or overpriced stocks, I couldn't even buy GTB at current valuation.

And let me say I have achieved my profitability target for year 2013 already playing these penny stocks. I have set a revised new target representing 125% of previously achieved target.

But its all small money sha. Just #100k.

how

[migiets]

Originally Posted by afolabi27

Please leave sir Paddilo alone, he is in a different league from you and most of us here.

My creditors will force me into bankruptcy if I don't make more than 40% in a full year playing my penny stocks.

Until recently, Skye bank constitute 60% of my portfolio and now I have Skyebank, CCNN, Eterna, ETI, Honeywell and NEM constituting more than 75% of existing portfolio.

I need Dangcem's current price to be divided by 3 to be tempting (note use of word) to someone like me.

I still have a long way to go, I need to take the risk, not yet time to do growth or overpriced stocks, I couldn't even buy GTB at current valuation.

And let me say I have achieved my profitability target for year 2013 already playing these penny stocks. I have set a revised new target representing 125% of previously achieved target.

But its all small money sha. Just #100M.

Chei, see as big boy dey talk. I want to be like you when i grow up.

[Babs_O]

Originally Posted by hispy99

All these other companies are not $16 billion companies

Yes they are not in Market Cap. But they facilitate higher transactions on the NSE. So of what use is the Market Cap when it doesn't command more trades on the NSE.

[eniyanman]

Originally Posted by paddylo

Every one has his investment style, so whats so hard to grasp about that?

Most fund managers in the west will not touch a stock trading below $5

Some only invest in mid caps etc.

If you go back to the beginning of this thread i have always maintained that DANGCEM is a long term bet for me, others claimed it was too expensive and they were waiting for it to hit N70/N80 before they buy, well they are still waiting.

If i am investing for the long haul, say 10 years i am more comfortable parking my money in a heavyweight large cap (Nigerian wise) stock like .

I actually also have NB and GTB in my portfolio. .the 2nd and 3rd stocks with the highest market cap on the NSE.

Everyone has their investment thesis, am not buying stocks for dividend income, i dont need it.

However with a $400 bn plus economy (after GDP rebasing), i believe certain stocks can grow to 5% 10% or even 20% of nominal GDP, like the Standard Banks, MTN, SAB miller in South Africa.

These companys that will grow will be the dominant names in the economy.

End of story.

Sir, how does GDP re-basing affect a company's ability to grow? Speed, whether measured in metres per second or miles per hour should have no effect on a car's performance. Did I miss something?
#JustThinking

[paddylo]

Originally Posted by eniyanman

Sir, how does GDP re-basing affect a company's ability to grow? Speed, whether measured in metres per second or miles per hour should have no effect on a car's performance. Did I miss something?
#JustThinking

Analysts expect that a rebased GDP showing a larger economy will attract offshore fund flow into Nigeria's economy, especially in consumer and industrial names.

Now DANGCEM is already valued at 6% of Nigeria's GDP.

I.e $16 billion in a $270 billion economy.

In the long run, its the valuation mismatch that will attract investors.
For example, if Nigeria gets to a $400 bn economy,then there is no reason why our NSE total valuation should not approach 80 - 100% of that, just as it is the case in South Africa.

Meaning stocks will rise 100 - 400 percent from current levels. my bet is that it is the heavyweight stocks that will lead such a rise.

You need to get out of the cocoon and go talk to international fund managers looking at our markets, for better insight, afterall they control close to 70% of the market

Cheers

[Salida]

Originally Posted by paddylo

Analysts expect that a rebased GDP showing a larger economy will attract offshore fund flow into Nigeria's economy, especially in consumer and industrial names.

Now DANGCEM is already valued at 6% of Nigeria's GDP.

I.e $16 billion in a $270 billion economy.

In the long run, its the valuation mismatch that will attract investors.
For example, if Nigeria gets to a $400 bn economy,then there is no reason why our NSE total valuation should not approach 80 - 100% of that, just as it is the case in South Africa.

Meaning stocks will rise 100 - 400 percent from current levels. my bet is that it is the heavyweight stocks that will lead such a rise.

You need to get out of the cocoon and go talk to international fund managers looking at our markets, for better insight, afterall they control close to 70% of the market

Cheers

We see your hand for DangCement on the market today.Jisike!

We are still waiting for the GDP rebasing.(Is Africa's focus on GDP misplaced? | Reuters)

[knightofdelta]

Originally Posted by paddylo

Analysts expect that a rebased GDP showing a larger economy will attract offshore fund flow into Nigeria's economy, especially in consumer and industrial names.

Now DANGCEM is already valued at 6% of Nigeria's GDP.

I.e $16 billion in a $270 billion economy.

In the long run, its the valuation mismatch that will attract investors.
For example, if Nigeria gets to a $400 bn economy,then there is no reason why our NSE total valuation should not approach 80 - 100% of that, just as it is the case in South Africa.

Meaning stocks will rise 100 - 400 percent from current levels. my bet is that it is the heavyweight stocks that will lead such a rise.

You need to get out of the cocoon and go talk to international fund managers looking at our markets, for better insight, afterall they control close to 70% of the market

Cheers

And you think the valuation of Dangcem is dependent on the Nigerian GDP? How will a sudden revaluation of the GDP affects the cashflow of the company? How will it lead to a sudden upsurge in demand for the cement produced by Dangcem? I thought the valuation of a company is dependent on the profits and balance sheet?

There is no hard and fast rule that the stock market must make up 80 - 100% of GDP. You seem not to know that the shadow economy is like five times larger than the one we see on paper. The financial services sector account for almost 45% of total market cap yet it accounts for less than 5% of economic growth; that should tell you something.

NB. I talk to international fund managers almost every day.

[eniyanman]

Originally Posted by knightofdelta

And you think the valuation of Dangcem is dependent on the Nigerian GDP? How will a sudden revaluation of the GDP affects the cashflow of the company? How will it lead to a sudden upsurge in demand for the cement produced by Dangcem? I thought the valuation of a company is dependent on the profits and balance sheet?

There is no hard and fast rule that the stock market must make up 80 - 100% of GDP. You seem not to know that the shadow economy is like five times larger than the one we see on paper. The financial services sector account for almost 45% of total market cap yet it accounts for less than 5% of economic growth; that should tell you something.

NB. I talk to international fund managers almost every day.

Exactly. I surprised when there's excitement about a revaluation. Whether of GDP or of currencies it doesn't mean much if the underlying structure remains the same. By itself, it does nothing

[nosa2]

Originally Posted by eniyanman

Exactly. I surprised when there's excitement about a revaluation. Whether of GDP or of currencies it doesn't mean much if the underlying structure remains the same. By itself, it does nothing

Bros leave am make e try use big grammar scatter pur head.

[afolabi27]

Originally Posted by paddylo

Analysts expect that a rebased GDP showing a larger economy will attract offshore fund flow into Nigeria's economy, especially in consumer and industrial names.

Now DANGCEM is already valued at 6% of Nigeria's GDP.

I.e $16 billion in a $270 billion economy.

In the long run, its the valuation mismatch that will attract investors.
For example, if Nigeria gets to a $400 bn economy,then there is no reason why our NSE total valuation should not approach 80 - 100% of that, just as it is the case in South Africa.

Meaning stocks will rise 100 - 400 percent from current levels. my bet is that it is the heavyweight stocks that will lead such a rise.

You need to get out of the cocoon and go talk to international fund managers looking at our markets, for better insight, afterall they control close to 70% of the market

Cheers

Originally Posted by knightofdelta

And you think the valuation of Dangcem is dependent on the Nigerian GDP? How will a sudden revaluation of the GDP affects the cashflow of the company? How will it lead to a sudden upsurge in demand for the cement produced by Dangcem? I thought the valuation of a company is dependent on the profits and balance sheet?

There is no hard and fast rule that the stock market must make up 80 - 100% of GDP. You seem not to know that the shadow economy is like five times larger than the one we see on paper. The financial services sector account for almost 45% of total market cap yet it accounts for less than 5% of economic growth; that should tell you something.

NB. I talk to international fund managers almost every day.

Originally Posted by eniyanman

Exactly. I surprised when there's excitement about a revaluation. Whether of GDP or of currencies it doesn't mean much if the underlying structure remains the same. By itself, it does nothing

Originally Posted by nosa2

Bros leave am make e try use big grammar scatter pur head.

I suppose first reply Padilo, but fear no let me, as that grammar big pass wetin my mama will understand. I like to keep issues simple, whatever my "illiterate" mama would not understand, I shy away from it. That's what my new boss is teaching me when it comes to analyzing investments.

But seriously I went to dig up what Mr. Bismarck Rewane, the MD/CEO of Financial Derivatives Company Limited said to Thisday on the effects on the economy of the proposed rebasing of Nigeria's GDP. (Nigerian Newspapers (Read them online); Nigeria [ Nigerian ] News & World / Africa News Flash)

According to him "This probably would result to an increase in our GDP to about almost 40 per cent nominal. It doesn’t change anything. We call it playing with mirrors because the number of yams you produce would not have increased. But if it makes you feel good, then fine. You know, if you have two mirrors in the room and you feel there are 10 of you in the room while there is only one person, if that makes you feel good, fine."

Quoting him further, "the first implication is that there is a law of large numbers which says that growth is more difficult when you have a larger base. 100 per cent of one is one; while 100 per cent of 10 is 10. But 10 per cent of 10 is one. So, it becomes more difficult to grow once the base increases. When you rebase, the first thing that will happen is that you real GDP growth will reduce. So, instead of reporting seven per cent growth rate, you probably will be reporting five per cent growth rate."

Then, we should be asking ourselves why is government thinking about this thing?, just like what's the benefit of currency devaluation to government of an import dependent economy?

Bismarck provided the answer, "The other implication is that there are rules of borrowing public debt and the comfort zone normally for West Africa and regional integration is that fiscal deficit should not be more than three per cent of your GDP. If you take your GDP to $400 billion, then three per cent of that becomes a higher figure. The National Assembly can then say you can spend more and then you can borrow more"

Paddilo, I thank you for forcing me to read.