I must confess my mixed feelings some weeks ago when Nestle jolted the market with its juicy dividend, those were moment you feel elated for having even 100 units of NESTLE, also moment you have excruciating feelings for not having Nestle in your portfolio. Am still young in the market though, I must however confess that I experienced Nestle at N300, I wish I had bought then but there was no way I could,with little knowledge and meagre cash in my possession.
However, After a while of moody feelings I pulled myself up consoling myself with the conclusion that Nestle is a stock of the older generations, a crop of investors that were young in the 70s 80s 90s and early 2000.
What then could be the NESTLE of my own generation? Instead of feeling worse about what I could not change I put the energy into the quest for the next NESTLE. It was hectic I must confess, making it more tedious is the fact that i neither have light nor good network where I am doing my NYSC but I was determined to look for the next NESTLE.. The NESTLE of my own generation.
After cursory research I arrived at OKOMU..okomu? YES OKOMU oil palm PLC!!!
From q3,12 of OKOMU the following can be deduced:
PATmargin 37%
EPS 6.34 ForwardEPS 8.5
PE 8.3. ForwardPE 6.16
ROE 30.2%. RONA 78%
RVS 16.71
HIGHLIGHTS
* The firm has a huge working capital which suggest strong liquidity.
* The buisness of the firm is a money spinning one,the firm generate much money from its operation than its entire profit after tax.
*The firm generate a revenue that its almost as equal as its Fixed asset.
The contradiction in the Revenue per share and Return on asset implies that the company is even yet to reach its climax of revenue generation,this can be supported with the reduction in the inventory of the company which shows quick conversion and sales of product.
My wonderful generation, I believe this is our own Nestle.
Take a look at all the stocks on NSE that sell at above N50 compare their EPS and PEs with OKOMU and you will me marvelled.
Recently Nestle gave out N18, NB gave out N3 yet all amounts to nothing in terms of dividend yield. Okomu dividend yeild will surely surpass all the aforementioned.
If Dangcem with almost the same EPS as OKOMU, with higher PE than okomu and with lower ROE to okomu can sell at above 100 then that implies that Okomu is seriously undervalued.
If NB or Guiness which has none of its fundamentals been able to match up with okomu can sell at above 100 then there is huge potential in this OKOMU.
My wonderful generation. I believe this is our own Nestle and am BUYING.
All question and suggestion will be welcome through:
Twitter: @1himself
1himself is currently doing his NYSC, he his also currently the Pioneer champion and brand ambassador of www.investment-one.com\feds
He was also the 2nd runner up of 2012 www.easykobo.com stock trial.
