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5 Best Shares to Buy on the Nigerian Stock Exchange

Updated 17 Aug 2022
5 Best Shares to Buy on the Nigerian Stock Exchange

The 5 Best Shares to Buy on the Nigerian Stock Exchange revealed. We have carried out extensive fundamental and technical analyses to uncover the best shares currently listed on the NGX.

This is a complete guide to 5 Best Shares to Buy on the Nigerian Stock Exchange.

In this in-depth guide you’ll learn:

  • How is share performance measured?
  • 5 Best Shares to Buy on the Nigerian Stock Exchange
  • How to choose the Right Share Broker in Nigeria
  • The Best Share Brokers in Nigeria

And lots more…

So, if you’re ready to go “all in” with the 5 Best Shares to Buy on the Nigerian Stock Exchange…

Let’s dive right in…

How is share performance measured?

Every investor has their own unique standards by which they judge a company’s stock performance. The price-earnings (P/E) ratio is the most often used metric for determining the worth of a business.

The P/E ratio is calculated by dividing the stock price by the company’s trailing 12-month EPS (EPS). Total returns, which include dividend and interest payments, are what most investors focus on. You should also consider the stock’s performance over the last 52 weeks and year to date (YTD).

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5 Best Shares to Buy on the Nigerian Stock Exchange

Morison Industries Plc (NGX: MORISON)

In addition to importing and distributing medical, surgical, and hospital consumables in Nigeria, Morison Industries Plc also produces and sells a variety of pharmaceutical and hygiene goods.

Wound care solutions, trauma/arthroplasty products, and bone grafts are some of the company’s forte, making it a market leader in Nigeria.

Currently, Morison Industries is the 105th most valuable stock on the NGX, with a market value of NGN 2.17 billion (representing about 0.0077% of the Nigerian Stock Exchange’s equity market).

Shares of Morison Industries, which started the year trading at 1.99 NGN, have since increased in value by 10.1%, placing the company in the 46th position, year-to-date, on the NGX.

Growth and Valuation Information
Share Price 2.19 NGN
52-Week Range 1.40 – 2.20 NGN
Market Capitalization 2.17 billion NGN
Earnings Per Share (EPS)
Price/Earnings Ratio (P/E)
Dividend Yield

United Capital Plc (NGX: UCAP)

United Capital Plc is a Nigerian financial organization that offers investment banking, asset management, trusteeship, securities trading, and insurance.

The company’s primary market is Nigeria, but it also solicits business from governments, organizations, and wealthy people throughout the continent.

The market value of United Capital Plc is NGN 76.2 billion, or around 0.271% of the total equity market on the Nigerian Company Exchange, making it the 28th most valuable stock currently.

United Capital’s year-to-date performance on the NGX places it at position number 24. Its share price started the year at 9.90 NGN and has since increased by 28.3%.

Growth and Valuation Information
Share Price 12.70 NGN
52-Week Range 6.70 – 14.15 NGN
Market Capitalization 76.2 billion NGN
Earnings Per Share (EPS) 2.09 NGN
Price/Earnings Ratio (P/E) 6.07
Dividend Yield 11.81%

Royal Exchange Plc (NGX: ROYALEX)

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Royal Exchange Assurance Nigeria Plc is a registered Nigerian insurance firm that provides life and non-life insurance.

This comprises general, health, and life insurance. In addition to offering banking goods and services for asset management, credit financing, and microfinancing, the firm also provides products and services for credit financing and microfinancing.

Royal Exchange is the 80th most valuable stock on the NGX with a market value of NGN 5.25 billion, which represents about 0.019% of the Nigerian Stock Exchange’s equity market.

Royal Exchange’s share price started the year at 0.88 NGN and has since increased by 15.9%, putting it 41st on the NGX in terms of year-to-date performance.

Growth and Valuation Information
Share Price 1.02 NGN
52-Week Range 0.47 – 1.65 NGN
Market Capitalization 5.25 billion NGN
Earnings Per Share (EPS) -014 NGN
Price/Earnings Ratio (P/E)
Dividend Yield

Honeywell Flour Mills Plc (NGX: HONYFLOUR)

Honeywell Flour Mills Plc is a Nigerian flour milling firm that produces and sells flour, semolina, wheat meal, brown flour, pasta, and noodles.

The corporation sells its goods under the brand name Honeywell. In 1995, the firm was formerly known as Gateway Honeywell Flour Mills Limited changed its name to Honeywell Flour Mills Plc.

Honeywell Flour Mills Plc is a division of Siloam Global Services Limited, with headquarters in Lagos, Nigeria.

Growth and Valuation Information
Share Price 34.00 NGN
52-Week Range 1.54 – 4.28 NGN
Market Capitalization 139 billion NGN
Earnings Per Share (EPS)
Price/Earnings Ratio (P/E)
Dividend Yield

Guinness Nigeria Plc (NGX: GUINNESS)

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Guinness Nigeria, a subsidiary of Diageo Plc of the United Kingdom, was founded in 1962 with the establishment of a brewery in Ikeja, the heart of Lagos.

In November 1963, three years after Nigeria’s independence, the first bottle of Guinness Foreign Extra Stout was made in Guinness Nigeria, making it the first Guinness brewery outside the British Isles. The firm was listed on the Nigerian Stock Exchange two years later.

Guinness Nigeria is the only comprehensive beverage firm in Nigeria, meaning it is the only company offering a diverse portfolio of alcohol and non-alcohol beverages, including spirits, lagers and ales, and non-alcoholic beverages.

Guinness Nigeria is the 17th most valuable stock on the NGX, with a market value of NGN 198 billion, which represents around 0.705% of the Nigerian Stock Exchange equity market.

Guinness started the year with a share price of 39.00 NGN, which has since increased by 132%, placing it in fifth place on the NGX in terms of year-to-date performance.

Growth and Valuation Information
Share Price 90.50 NGN
52-Week Range 29.00 – 110.00 NGN
Market Capitalization 198 billion NGN
Earnings Per Share (EPS) 6.71 NGN
Price/Earnings Ratio (P/E) 13.49
Dividend Yield 0.51%

How to choose the Right Share Broker in Nigeria

Traders could not have picked a more favourable time to enter the investment market than the present. Competition among online brokers is high, which means costs are dropping down and features are being boosted.

Those interested in trading global financial instruments could choose from a wide variety of online forex and CFD brokers. However, there are several factors to consider when choosing a broker and we will go through them here.

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Commission Charges

Individual stocks, options, mutual funds, exchange-traded funds, and bonds are the main investment types offered by brokers. Some will also provide exposure to the forex market, futures trading, and cryptocurrency exchanges.

Both the suitability of the broker’s offerings to your investment requirements and the fees you must pay is dependent on the investments the broker has available. You should pay close attention to the commissions that are involved with the investments you like.

Overall Reliability

There is a diverse selection of brokers available. Several have been popular for many years, while others have just recently emerged.

That does not imply they cannot be trusted, but if they are managing transactions for clients, they are members of a self-regulatory organization like the Financial Industry Regulatory Authority (FINRA), the Financial Conduct Authority (FCA), and other regulators, or subject to additional oversight.

Account Fees

While it could be impossible to eliminate account fees, they may be kept to a minimum. To withdraw funds or investments, or to close your account, most brokers will assess a fee. When switching brokers, your new firm could pay some or all your transfer expenses.

If a broker does not charge them, or if you do not use their optional services, you could avoid paying most additional costs.

Annual costs, inactivity fees, trading platform subscriptions, and additional charges for research or data are all examples of the kind of expenses you should be aware of.

Pricing and Execution on Trades

Cost is less of a factor today, leading to commission-free transactions becoming the norm at most brokerages.

However, you should consider the brokerage’s position on the controversial practice of paying for order flow and how much it costs before making a final decision.

This is especially true if you are an active trader who wants their deal completed at the best price possible, even if it means a difference of a few cents.

Additional Tools, Educational Materials, and Features

Look for a brokerage that provides free educational tools like live webinars, detailed how-to instructions, video tutorials, glossaries, and more if you are just starting in the investment world.

You should also look at the broker’s commitment to educating its customers about the inherent hazards of more complex trading tactics like options.

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Conclusion

The list that we provided consists of the best shares that can be purchased on the NGX now. However, all potential investors must remember that investment carries risk and that all stock prices are dynamic, and not static.

Share price alone is not an indication of a company’s financial performance or future potential, and Nigerian traders must carry out extensive fundamental and technical analysis before they invest.

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