So far, we’ve scoped out bank stocks in Nigeria and Ghana, analyzing their profitability, growth, risk, and value to separate the bargains from the bunk.
Now it’s time to turn to Kenya, East Africa’s largest economy. Ten banks call the Nairobi Securities Exchange home. All of them possess different strengths and weaknesses.
Let’s put them through our ranking exercise to help determine which ones merit a more detailed analysis.
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The World Bank estimates that Africa needs to spend $93 billion per year on infrastructure in order to sustain economic growth. Currently, it invests less than half that amount.
The continent needs power plants, roads, bridges, and housing. And all of these require cement.
That’s right. Cement companies may be the best way for investors to leverage an African infrastructure boom.
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It’s not necessary to open an African brokerage account to add a bit of the continent to your portfolio. Kraft, Marriott, SPX, American Tower, and Cummins are all making big bets on Africa and conveniently trade on the New York Stock Exchange.
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Last week we crunched the numbers of some Nigerian banks, analyzing their profitability, growth, risk, and value to separate the gems from the junk. I hope you got as much of a kick out of the exercise as I did, because we’re going to do the same thing again today. [...]
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Index investing sure is popular these days. You’ve got your small-cap indexes. Your large-cap indexes. Growth indexes. Value indexes. Country indexes. Bond indexes. Any slight affinity among a group of securities seemingly results in some sort of new index ETF.
It’s got me feeling a little bit left out.
So, today I’m launching the Investing In Africa Index.
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Nothing symbolizes the African renaissance better than the mobile phone. It represents technological advancement, deepening connectivity, and economic inclusion. Unfettered by outdated fixed-line infrastructure, Africa is at mobile technology’s bleeding edge — pioneering everything from mobile payments to crowd-sourcing.
So, African telecom stocks get a lot of attention. Companies like MTN, Sonatel, and Safaricom are followed by investors across the globe.
Let’s see how the six most prominent wireless stocks in the region stack up against one another.
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Much has been made of Africa’s rapid economic growth. And it truly is remarkable. The IMF projects that seven African economies will grow faster than 8% this year, and six of the top ten fastest-growers economies in the world will come from the continent.
Unfortunately, investing solely on the basis of growth forecasts often ends in disappointment. Rapid economic growth doesn’t necessarily translate into awesome stock market returns.
To get a true sense of where investment opportunity lies, we need to combine growth’s yang with the yin of value.
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If you’ve ever taken a look at the stocks listed on an African market, you likely noticed that they tend to be dominated by banks. Quite often banks are the exchange’s largest, most liquid shares.
It’s for this reason that I spend considerable time coming up with quick and easy ways to evaluate the relative attractiveness of bank stocks.
I walk through my method here.
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Understated Zambia is quietly putting together one of the world’s most impressive records of economic growth. The Southern Arican nation’s GDP has grown in excess of 5.3% every year since 2003, and the IMF forecasts its economy will expand by 7.7% this year thanks to strong demand for its primary [...]
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Kenya investors don’t seem to like agriculture stocks, and I’m not sure I understand why. Almost all of them presently trade for a fraction of their book value and less than seven times their trailing earnings.
Granted, agricultural stocks do have their risks. But with the globe’s population growing and arable land becoming more scarce, I think the market’s pessimism is overdone.
Here are five agricultural stocks that put food on the table, and, possibly, profits in investors’ pockets.
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Coffee Junkie. Air Guitarist. Number Cruncher. Sometime Jogger. Labrador Wrestler. Former Partner, Kivuno Capital Management. Editor, InvestingInAfrica.net. Read More.
