Rank: Elder Joined: 12/4/2009 Posts: 10,804 Location: NAIROBI
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S.Mutaga III wrote:heri wrote:S.Mutaga III wrote:I took some time to examine my investment journey over the years. With the index hovering above the 3600 mark from lows of about 2800 in January, it is safe to assume that we are squarely in a bull market. A quick check of demand and supply across most counters in the exchange in the last few days also supports this claim. There is more demand than supply. With the election around the corner, I have decided to make a re-entry and not wait for the elections to make my first move. If the elections are peaceful, I expect a major bull run to ensue which may make some shares expensive and reduce potential gains. First, I would like to expressly say that I will avoid banking stocks until their HY results are out. The Q1 results across the sector revealed anemic growth due to the rates cap. I expect the banks that have expanded beyond Kenyan borders successfully to survive this storm over time. Here is my first pick for 2017:
Total Kenya
Current price:- Ksh 20.5
Current P/E:- 5.775
Dividend yield:- 5.17%
Growth in PAT in last 4 years
FY 2013:- 1.3 billion
FY 2014:- 1.4 billion
FY 2015:- 1.6 billion (+13.4%)
FY 2016:- 2.2 billion (+38.3%)
From the above figures, it is clear that the company has entered a high growth phase (+38% PAT for 2016) and has been performing well since 2013. The management has a positive outlook for the company going forward. I am also impressed by the growth in its "other income" segment which was 962 million in 2016 and 766 million in 2015. The company is making serious efforts to earn non-fuel income which is commendable. Additionally, the company has been increasing its dividend payout since 2013 as follows:
2013:- 0.60
2014:- 0.70
2015:- 0.77
2016:- 1.06
NB: Total Outre Mer owns 92.26% of the company. It has(72.19%) in the form of preference shares. The parent company has no known intentions of redeeming the shares.
STARTING CAPITAL:- Ksh 1,000,000
Investment activity 1
:- Buying 15,000 shares (Total KE) at Ksh 20.5 per share (ex dividend).
20.5*15000+(20.5*15,000)*0.0185= Ksh 313, 189
Portfolio:
15,000 shares (Total)
Ksh 686,811 (cash)
Happy Hunting! Thanks for sharing Have you compared TOTAL with KK? I compared the two before choosing Total over KK. Total was cheaper on a PE and Dividend yield basis. Both counters have experienced growth in the last few years. The good performance of KK reinforced my decision to invest in Total because it proved that the sector was making money during this economic recession. Total is cheaper in terms of PE and dividend yield over KK because of the preference shares it has. KK has no preference shares. Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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