Best Nigerian Stocks to Watch Out for in 2022

After the roller-coaster that was 2020, 2021 did not quite turn out easily too, especially in the stock market. Although there was more positive returns and the year even ended with a positive return of about 6.7% – First pushing the listed stocks value up by N1. 23 trillion.

The liquidity was majorly driven by retail investors and domestic institutional investors, indicating that Nigerian investors do have the capacity to contribute to the growth and stabilization of the market.

The question now is, are there stocks to watch out for in 2022? If yes, where are they?

Stocks to Watch Out for in 2022

The Nigerian stocks are currently undervalued which means that there are lots of buying opportunities in the market.

Below are some of the stocks to watch out for this year:

MTN Nigeria Communications Plc

MTN is a communications system company that operates HSN and Nigerian cellular network systems. So far, MTN is the biggest Telecommunications provider and in 2021, they announced that they were giving a public offer for their shares.

Altogether, retail investors purchased close to 600 million shares, all at N169 per share. By January this year, the share price was at N185.5. This year, we project a 25% y/y, with a revenue of up to N647 billion.

MTN is also working on new registration centers for new SIM registrations and NIN enrollment, these we believe will contribute to shooting up MTN’s stock value.

By September 2021, after nine months, MTN’s revenue had grown from N975. 764 billion to N1.206 trillion, a 23.62% increase.

If you had purchased shares from MTN on the 1^st of January, 2021, there would have been a 15.95% return by 31^st December.

This explains why we believe MTN shares should not be overlooked by stock investors. Plus, MTN continues to lead its peers in the Telecommunications industry in terms of profit, revenue an customer base.

Flour Mills of Nigeria Plc

This is a leading Agro-Allied and Food company that has a goal to maintain growth and sustain profitability.

In recent times, Flour Mills is combining operations with Honeywell, making Honeywell dispose of 71.69% stake in Honeywell Flour Mill Plc to Flour Mills Plc.

Since both businesses share the same goals, they plan to create a giant in the food industry in Nigeria, sustaining preservation and long-term creation of jobs. In 2022, Flour Mills stocks ranked among the best performing, closing at N29/share, and increasing at 2.3% YtD. Between 2021 and 2022 (half-year), this company’s revenue hit N522.8 billion, a stark progress from N355.1 billion between 2020/2021 (half-year). Its performance stayed consistent and grew to 35%.

This brilliant performance was as a result of the business’s continuous strong operating performance and continued improvement.

The stock decreased in January by 0.9% and some analysts, including Meristem, say it is a good time to Buy considering that their target price is at N46.6.

Dangote Cement Plc

Africa’s leading cement producer operates in ten African countries currently has its production capacity at 48.6 million tonnes/year. As at January 2022, its share price was at N260/share, a 1.2% YtD change. In 2021, it’s price rose by 4.9%

The analysis for Dangote Cement in 2022 is N287.81 (Meristem), United Capital says N270.3 and Vetiva says N280. All of analyses point out that you should consider a Buy. For nine months, in 2022, ahead of the full year, by September 30, 2021, the revenue grew to N1.022 trillion from N761.960 billion.

Disclaimer: We strongly believe that these are good stocks to watch out for this year. However, this is not a financial advise and you will have to carry out extra research and analysis until you arrive at a best suited decision.