Kenyan stock report - Safaricom

KENYA

Safaricom rises 1.7% on high volatility August 17, 2018 15:00 EAT

NEWS BITES - AFRICA

Safaricom Limited (NR:SCOM), Kenya's largest Telecommunication and technology company by market cap, traded between an intraday low of KES28.75 and a high of KES29.50. The price range has expanded in the last two days (from 50.0c two days ago to 75.0c today) which, accompanied by a price rise, is a bullish signal. The average daily volatility of 2.9% places Safaricom's stock in the 2nd quartile in the market, meaning it is the moderately volatile. Today its volatility (highest price minus lowest price/lowest price) of 2.6% was 0.9 times the average daily volatility of 2.9%, up from 0.9% on Thursday and 1.7% on Wednesday. Safaricom's stock price has increased 50.0c (1.7%) from its last trading session of August 16 to close at KES29.25. Compared with the NSE 20-Share Index which rose 1.4 points (0.04%) in the day, the relative price increase was 1.7%. The volume was 0.1 times the average daily trading volume of 10.2 million shares. Its MCap is KES1,170 billion (US$11.6 billion).

Highlights in today's Report:

SECTION 1 BULLISH SIGNALS

SECTION 2 BEARISH SIGNALS

SECTION 3 PRICE VOLUME DYNAMICS

SECTION 4 RELATED NEWS

SECTION 5 GLOBAL RANKING

SECTION 6 SUMMARY FINANCIALS

SECTION 7 PROFILE

SECTION 1 SAFARICOM BULLISH SIGNALS

Technicals:

+ The price increased 1.7% in the last week and 1.7% in the last month.

+ Compared with the NSE 20-Share Index which rose 0.6% for the week and 1.4% for the month, this represented a relative price increase for Safaricom's stock of 1.1% for the week and 0.3% for the month.

+ The present value of KES1,000 (PV1000) invested one year ago in Safaricom is KES1,318, comprising a capital gain of KES268 and dividend reinvested of KES50.

PV10001-week1-month1-year
SCOM.NR1,0171,0171,318
NSE 20-Share Index1,0061,007825

+ The present value of KES1,000 (PV1000) invested ten years ago in Safaricom is KES8,601, including a capital gain of KES5,494 and dividend reinvested of KES2,108.

+ 10 years Multiplier in KES = 8.601x

+ Compound Annual Growth Rate (CAGR) in KES = 24.0%

Present Value of USD1,000 invested 10 years ago:

+ The present value of USD1,000 (PV1000) invested ten years ago in Safaricom is $US5,579, including a capital gain of $US3,212 and dividend reinvested of $US1,367.

+ 10 years ago USD 1 equalled KES 65.3595

+ 10 years Multiplier in USD = 5.579x

+ Compound Annual Growth Rate (CAGR) in USD = 18.8%

Aug 17, 2018: USD 1 equals KES 100.77

High Performance Indicators and rank of Safaricom in the Kenyan market:

DescriptionSCOM ValueRank In Market
Price Change %1.7In Top Quartile
Price/MAP2001.02In Top Quartile

SECTION 2 SAFARICOM BEARISH SIGNALS

2.1 Technicals:

Overbought/Bearish/Resistance Signals:

+ The stock is overbought according to the Williams % R indicator of -14.3, suggesting the price is close to its 14-day high of KES29.50.

2.2 Fundamentals:

+ The relative yield of SCOM, defined by its yield of 3.3%, divided by average yield of dividend yielding stocks in the NSE 20-Share Index of 3.9% is 86.0%. This suggests Safaricom stock is overvalued in dividend yield terms.

SECTION 3 SAFARICOM PRICE VOLUME DYNAMICS

3.1 Technicals:

+ Volume: there were 961,200 shares worth KES28 million (US$278,219) traded today. In the past week, volume was 0.5 times average and the shares were up 1.7%.

+ Safaricom is at a discount of 12.7% to its 12-month high of KES33.50 on April 05. It is also at a premium of 32.3% to the 12-month low of KES22.11 on September 01, 2017.

3.2 Turnover Rate & Turnover Period:

+ The turnover rate in the 12 months to date was 5.8% (or a turnover period of 17 years 3 months). This average length of ownership of the stock at 1.3 times the average holding period of 13 years 4 months for stocks in the NSE 20-Share Index suggests a larger number of core investors, making a long-term investment safer.

3.3 Moving Annual Return (Past 5 years)

Based on a dynamic start date of 5 years ago, the Moving Annual Return has consistently exceeded 20%.

SCOMClose (KES)Dividends (KES)Capital Gain %% YieldAnnual Return %
Aug 1729.250.9726.84.231.0
1 Yr ago23.071.4412.97.120.0
2 Yrs ago20.430.6441.74.446.1
3 Yrs ago14.420.4717.63.821.5
4 Yrs ago12.260.3164.74.268.9

Close 5 years ago KES7.44

3.4 Month-on-Month Price Volume Comparison (Trailing month - ended 16th)

16 Aug16 Jul14 Jun16 May16 Apr16 Mar
Price 16 Aug (KES)28.7528.25302930.2529.75
% Price Change1.8-5.810.1-4.10.80.8
Avg Daily Volume10,176,19810,589,42010,794,68011,487,39211,108,48511,467,496
VWAP (KES)28.9228.8229.4829.5629.9828.72
Price Range (KES)27.75 - 29.7527.25 - 30.2527 - 30.526.75 - 31.2529.5 - 33.529 - 30.5
Relative Price Change %1.5-5.216.62.90.8-1.5
Volatility %7.2111316.813.65.2

SECTION 4 SAFARICOM RELATED NEWS

Other News

+ BSS/News Bites:

Safaricom Limited is placed 5/36 in BSS News Bites' ranking of Kenyan performers in the past year, a percentile ranking of 86.

SECTION 5 SAFARICOM GLOBAL RANKING

5.1 Global Rank [out of 47,647 stocks] and Rank of Safaricom in the Middle East & Africa Region [out of 2,279 stocks]

DescriptionValueGlobal RankIn MEA Region
MCap (US$)11.6B1,28426
Total Assets (US$)1.5B8,004337
Revenue (US$)1.6B5,067130
Net Profit (US$)312.3M2,59585
Return on Equity %30.41,77790
Net Profit Margin %19.46,148484
Price to Book7.632,2961,543
Price/Earnings24.912,169791
Yield %3.48,828864
PV1000 (1Year) USD*1,3627,291323
US$* Change (1Year) %23.77,771332

* 1 year ago USD 1 = KES 104.17

Aug 17, 2018: USD 1 equals KES 100.77

5.2 Rank of Safaricom in the NSE 20-Share Index [out of 17 stocks] and in the Total Kenyan Market [out of 41 stocks]

DescriptionValueIn NSE 20-Share IndexIn Total Kenyan Market
Total Assets (KES)157B59
Revenue (KES)163.9B12
Net Profit (KES)31.9B11
Return on Equity %30.411
Net Profit Margin %19.4510
Price to Book7.61336
Price/Earnings24.9823
Yield %3.3919
PV1000 (1Year) USD1,31824

SECTION 6 SAFARICOM SUMMARY FINANCIALS

Dividend History

+ Trailing 12 months dividend has improved from 31.0c in 2014 to 97.0c in 2018.

SECTION 7 SAFARICOM PROFILE

7.1 Activities

Safaricom is engaged in the provision of mobile phone services. It provides products and services for telephony, general packet radio services, third generation, enhanced data GSM environment, data and fax. Its Safaricom PrePay service includes international dialling, voice mail and prepays roaming. Messaging includes ways of communication, such as short message service (SMS), e-mail and multimedia. With messaging service, customers also get daily updates for news, sports and entertainment. Its other products and services include Safaricom Shops and Safaricom Mail.

7.2 Top Management

The chairman is Nicholas Nganga and the chief financial officer is John Tombleson.

7.3 Issued Capital

Based on 40,000,000,000 issued shares the market capitalisation is KES1,170 billion (US$11.6 billion).

COMPANY IDENTIFIERS

Physical Address: PO Box 46350 Nairobi, 00100 Kenya

State/Province/Country: Kenya

Exchange: The Nairobi Stock Exchange

ISIN: KE1000001402

NR:SCOM; KN:SCOM; SCOM.NR

RIC: SCOM.NR

Source: www.BuySellSignals.com