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Why I Will NOT Buy MTN Public Offer Shares | Flo Finance
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- เผยแพร่เมื่อ 11 ธ.ค. 2021
- To buy or not to buy MTN Nigeria shares. In this video I share Why I Will NOT Buy MTN Public Offer Shares.
Shares analysis:
Part 1: • How to Pick and Invest...
Part 2: • How to Pick and Invest...
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They say "no knowledge is a waste". They also say, "Knowledge is power" I have grabbed my own knowledge from this video. Grab yours🤷♂️. Thanks big Sis for sharing 👍.
You have succeeded in making many confused investment terms to be clearer and very understandable to me. More grace
Hi Aunty Flo, I saw my comment on the screen. 😊... And, thanks for making this video. So insightful and well detailed. Now, I can make informed decision. Thanks great one....🙌
Thank you so much Flo for this critical analysis.
You actually did share my thoughts. Monitoring the market
Awesome!!! I learned a lot. Thanks once again Queen!!!!
Nice one flo, you are on point. Keep the good job going.
Thanks for the detailed analysis. Learnt a lot.
Nice Analysis Sis Flo
I'm new in this share thing i would love to be educated more
Flo thank you very much for this video, am happy I found you online...lol. God bless you for not just shearing but making it very simple for people like us
Thanks. You have made me rethink my investing strategy for Nigeria. I think if someone got in during the dip in 2019 perhaps it is worth it. Now it is clear it is overvalued.
Great analysis, in addition to the above, I also look at stock price appreciation and the company's debt profile. Are they using debt to pay huge dividends? It is not sustainable to use increasing debt to pay dividends.
A company like MTN may not be paying dividends because they are using the cash to build infrastructure (like 5G) or venture into FinTech.
Once again, thank you for sharing. Those PE ratios are very low. Here in the States, most blue chip companies have a PE of 25.
Wow you are just so gifted in explanation, thanks alot
Thanks so much for this analysis
We appreciate your knowledge thank you..
So nice to see you, Flo. I was just saying to myself I haven’t seen a new vlog since you returned from Nigeria.
I just love this sister. Always 100%
Very helpful information, yes at times we win some and lose some.
Nice one Flo, very helpful
I enjoyed this video.
Nice Informative video.
Wow, you are now dabbling into the world of finance too. Your breakdown of the fundamentals is noteworthy. But, comparing a long historical data for Fidelity, Zenith, and others that have been on the market for a very long time to a couple of years of MTN's history is tantamount to comparing apples to oranges. Furthermore, dividends are not the be-all and end-all of investment in the equity markets. There's also appreciation, and, as you point out yourself, MTN is a high growth sector...a sector in which it all but dominates.
I do agree with you that you should not buy. However the reasons you gave are general reasons applied to informed investing strategies. In particular to this shares offering, MTN is diluting the company’s shares to raise capital within instead of borrowing. On the long run, the effect of this dilution will reflect on the stock price. Therefore it is a bad idea to buy now. In fact I’ll recommend selling 25 - 50% of position if one has MTN shares and buy the dip later.
Hello.
How sure are we that they will be a dip some..
Mtn is evolving ..
I doubt they will be a dip before a rise
I love your analysis. And your opinion is important. But, you have only used your analytical points on your scorecard to take a decision. Your fundamentals on the scorecard were not considered. Furthermore, the dividend payout comparison of a company that was listed 2years ago over companies listed many years back cannot produce the same payout ratio.
You are telling us reality
Very nice video!, I am investing in MTNN because the PE is representative of the moat and the sector they operate. I also agree that the dividend yield is low but I am okay with this because management is doing a good job with return on invested capital, so I don't mind if some of the returns is reinvested in the businesses. Earnings growth forecast also supports a buy. My main concern is the debt profile but this is a global problem for this sector.
🙌🙌🙌 MTN is lucky to have you as a "we die here" investor. 👍
@@FloFinance 😆😆😆
@@FloFinance Which companies are selling shares now?
Dear Flo thanks for educating us about this issue.
As a layman in this things I believe you’ve helped a lot of us Nigerians to understand the underlying factors in MTN selling its shares, I definitely understand the point you’re making. If a company like MTN is making a profit and decides to give to its shareholders peanuts just as you’ve exposed I don’t see why I should trust or put my money into such company. MTN cannot make $100 and decide to pay a dividend of $1 to its shareholders in the name of spending the rest of its profits on infrastructure projects, its left for its shareholders to decide the amount of dividend to be paid to its shareholders. Most of this foreign companies are good at shortchanging Nigerians either in service delivery or dividend payments.
Flo you’ve done a fabulous job in breaking this down for the average Nigerian investor.
I see myself as a long term investor. This is because I just buy shares and move on, although I only have shares in the Financial Industry. I do not live on it. I can not even remember the last time I checked GTB or Zenith shares on NSE. I missed this MTNN's stock sale, just the same way it happened in 2019. How much was their IPO back then and how much is it now? For people who classify themselves as a short or long term investor, what is the duration of either?
Subject to other issues that may affect the operations of a company (whether it would stay in business or not), a company's stock or share price will increase in the long run. I am sure some people who bought at the first IPO will sell at the N190-something you showed in the video in order to take advantage of this N169/share. So what is my take? I would say if you have any amount to squander on any joint or fashion, squander it on MTNN shares! Which one? The next phase. When? 🤷♂️😁
#2
I enjoyed this video Flo, thank you. Immediately you shared their DPS, even before calculating their dividend yield, I already saw the red flag😅 But I guess people will invest for the future hope that it will be a good one just like you said...
Ok ooo. I no fit play that game of hope and faith. 😂 When they start showing the money, eheeee.
I feel like an investment expert now after watching this video. Thank you so much Flo for sharing. This is very educative and informative. MTN is stingy if you ask me.
🤣😂🤣😂 that stingy got me. They are aka gum.
Chibuike ulasi .Wow I really like the way you support your nigerian sisters on TH-cam. I always see ur comments on most of their videos.
I Chang phone can I login on MTN primary offer am unable to log in my new phone
To start with, you are so naughty and crazy with your responses to some comments.(apologies if that annoys you). I hardly comment on public space like this but I really got value for this video so I just subscribed, with the notification bell turned on. 70% of the indices you used here are new to me, thanks. This is the best review so far. I will still share the video
Already liked
I like your analysis. It would have been good if MTN is compared with other coy's in the same sector (although I don't think the other coys are listed yet). I think it's a buy based on future earnings, the coy will be getting the PSB licence very soon & if they start the PSB operation it will greatly increase earnings & dividend yield.
I support your submission, despite liking the way the lady' stated her reasons for not been a buy, in finance, we are advised to compare likes for like. An average telecoms coy spend alot in asset acquisition compared to a bank, who in recent times have switched to electronic banking, hence requiring less physical structure etc. MTN will set aside huge amount for such assets. Also the future earnings is great as stated
Jude I mentioned in the video that I use only historical data when analyzing companies. I do not buy into a company based on predictions, what ifs and emotions.
The main reason I used Fidelity and Zenith was because this was a quick video and I already had data from these two companies. Still, I see no need to start making calculations for other telecomms companies because I must not invest in telecomms. When there are better ROI companies on the exchange? More on this in my response to Michael. 👇
Michael you may also argue that they employ more high tier professionals hence more running costs. But as a shrewd investor, I don't care about those. All I care about is ROI. What if I compare it to other telecoms companies and it comes out tops in that sector? Does it change the fact that it will give me poorer ROI compared to some other companies on the stock exchange? No.
This video just proves there are companies with better ROI on the Nigerian Stock Exchange that one can invest in. If you watched the two videos I referred to, you'll understand that I'm not tied to any company's or sector's loincloth. I'm for no company and I'm for every company that pays me consistent good ROI. 🤷♀️
Thanks for your submissions, however one of the fundamentals of investing is diversifying and not putting all eggs in a basket, 1 basket meaning financial sector for example.
It is always good to have a blend so that in the event there is a down turn in one sector, the other compensates for it.
While the financial sector had better ROI as submitted but my point was the sector didnt need to invest alot in hardware like the telecoms sector do, hence while Financial sector produce high profit, telecoms or sectors like manufacturing will.possibly retain more monies for capital investment compared to financials who in the light of recent development wouldn't invest huge funds in building physical structures etc.
Just my thoughts, I hope ppl make their decisions having considered all variables.
@@michaeljabagun8461 remember, I only used these two banks because I already had the data for them. Like I said in the video, I am not telling anyone to invest in them. In that same referred video I also did the calculation for Nestle and shared my thoughts.
So diversify, yes but I will not leave my money in a company that is paying me less ROI all in the name of diversification when there are other options, you get? And come to think of it, which other company in the ICT would I have compared MTN with? Airtel that does not even have a financial report information on their website? 🤷♀️
There are so many sectors on the NGX, all an investor needs to do is find one that pays the best returns in the sector of interest while diversifying. If a company I invested in starts going downhill tomorrow, I'll pull my money. The better dividends I have earned from them all through the years would give me a better feeling than taking "dividend cuts" from another company in whichever sector.
One important question I have always pondered upon.... how and where do we get other stocks to invest in.... considering the fact that they are not that easy to find.... other Nigerian stocks. I don’t know where to buy other shares
Just speak to a stockbroking company. They charge a token for their services. We have a lot of them in Nigeria 🇳🇬 I use Afrinvest as my stockbroker.
I use passfolio to invest in foreign stocks.It is a broker app
You have 20 years of investment experience in Nigeria stock? How old are you? Be serious pls
Hi Flo,
I admire your efforts and analyses plus your gracious sharing spirit. I will like to add few dimensions to what you did .
1. You did not consider price appreciation... Capital gains and share bonus as part of one's gains in the investment...
2. The P/E ratio represents how many years(how long) it will take the earnings to recover fully (aka pay back period) price of that share.. ...It is not about amount of money but time frame to recoup ..
3 MTN just got 5G license . ...that is a boost to it's operations.
4 They are getting financial services permit/approval by CBN...another boost.
5. You know they owe the Federal Govt fines. . which might have made them pay less dividends during the period under review.
Thank you Basil for bringing your stockbroker expertise to the conversation. I really appreciate it. BUT, that big but, I never consider future metrics when analyzing a company because I don't have the expertise and confidence to make those predictions like you guys. You can say I play it safe. I am a simple woman so all my analysis are based on historical events. I see this stock investment thing as a marriage. I will only marry someone based on the behaviors the person has exhibited up till the point of the proposal. Not the behavior he is expected to exhibit after marriage. A marriage contracted on "he will change" always turns sour. 😂
That said:
1. Not only is this a future prediction, I don't really care about this because like I said in the referred to videos, I am a long term passive investor and I only invest for dividends. I believe it's only those who are looking to actively trade the shares that should care about price appreciation.
2. Do you mean PEG ratio? Because that's not my understanding of P/E ratio. If that's what it means, please can you explain what the numbers I got mean. Does it mean it will take me 13 years to recoup my money in MTN and 2 years in Fidelity?
3. This does not confirm a boost in dividend yield. In fact the way I see it, this will most likely decrease dividend yield as they try to redirect more of their earnings to the 5G roll out. This will be a good reason to decrease dividends and the shareholders will "understand".
4. You are hoping that something like this will equate to more dividend yield in the future, right? Again, future hope lol
5. They are still owing some tax thingy. 😂 For the foreseeable future.
The thing is that they are still a baby on the NSX so let me give them 5 years. With all these roll out (5G, financial services) what I see in the next 5 years is spending, spending, spending. Not good for dividends ezi okwu. 🤷♀️
Great analysis. I admire your investment style. But I have some concerns. What's the ideal P/E ratio for telecoms? When you say MTN is overpriced...you mean relative to some banking stocks. You should also compare related companies. You can't establish overvaluation by comparing a stock in telecoms with banking stocks. It could mean that MTN is not overvalued, but that Nigerian banks are undervalued relative to their pairs in other emerging markets. I know for sure that most Nigerian banks have always been undervalued. Then decision making on whether to buy a stock should be based on future expectations and not the past. In fact, the whole essence of stock valuation is really about potential value creation. That a company has a low P/E ratio or high dividend yield today does not guarantee its existence in the next 5 years. Nokia is a good example- had to be sold to remain in business. So when you buy a stock, you're taking a bet on the future of the company's valuation relative to its value today. Tesla is a good example of this. There are companies that are barely making a profit with significant valuation.
Good for you Fatai. I sincerely hope you make money operating that way because what you described sounds like gambling to me. You even used the word "bet". I don't want my heart broken, simple. If I MUST ONLY invest in a telecomms company, then it becomes imperative that I compare MTN to other telecomms companies. But in this case, I am shopping for a company, ANY company that will give me the best ROI today-today. Not based on hopes, prayers and faith. MTN or any other company for that matter on the NSX is not my Papa's company so no sentiments attached. I don't want to help build a company in the hopes of something good in the future. Will they make me a board member? 😄
If you think the banking sector is undervalued then that's the more reason one should invest in them, right? So we are effectively saying the same thing. Nigerian banks also have room for growth just that the Nigerian banking sector does not want to go into real estate and mortgages. But at least they pay better dividends for now.
@@FloFinance, In the end, we are all taking a bet. Taking a bet in this context does not mean gambling. The future is not guaranteed, so when you invest in something, you take a bet because it is not certain that you will realise the returns on the investment. And the past is not a measure of the future. So if I buy a stock, it's because I see future value in it, whether dividend in your own case or appreciation in the value of stocks. Angel investors do write cheques for start-ups with a very high risk of survival. Does that make such investors gamblers? You can only say someone is gambling when the chances of success is very low- usually near zero because many will have to lose for you to win. This is the case for investing in FOREX and most derivates deals. But investing in companies isn't a zero-sum game- the stocks are backed by real assets that can generate money in the future. Investing in stocks can be said to be equivalent to gambling when you do short term trading that is based on technical analysis. Then on comparing telecoms with banks...I am not talking from your perspective. I'm saying that you can't establish the over-valuation or under-valuation of a stock by comparing the P/E of a goat with that of a cow. This is not to undermine your decision because banks have lower PE. I'm just saying you can't establish that MTN is overvalued as your analysis is not deep enough to establish that fact. The truth is that P/E ratios and dividend yield varies across different industries. So either has to compare the P/E ratio of a company with its historicals and with the industry in which it operates to establish some form of under or overvaluation. But even that isn't enough. Other factors need to come in to establish over-valuation. Secondly, on the banking stocks, it is clear they are undervalued based on what I said earlier. You will likely get value from healthy banks like Zenith, GTB and Fidelity. But you can't use their metrics as standards for companies operating in other industries. That said, I admire your investment philosophy and risk appetite. Cheers. Disclosure: Not saying MTN is a buy oo. I am just providing a differing view
Chai. Overvalued eh?
👍👍👍
Shares I'm coming for you .....
Hey Flo, what platform do you use in purchasing shares on the Nigerian stock exchange?
Watch some previous videos. She's addressed it.
Hello how are you?
I am married to a Igbo man I am from Jamaica but live abroad. My question to you is if I can open a. Dollar account in Nigeria being a none Nigerian?
I'm fine, thanks Samantha.
Do you have a Nigerian passport? Unfortunately, only foreigners that have some kind of documentation: Nigerian passport or resident permit can open bank accounts in Nigeria. I have asked bankers this question over and over again and the response is always the same. Watch this Q & A video I did with a bank employee in Nigeria: th-cam.com/video/e9jwIiv5Mug/w-d-xo.html
👍🏻👍🏻👍🏻👍🏻👍🏻👍🏻👍🏻👍🏻
Is under paying yield not supposed to be illegal? I do not know so I am asking and not confirming that anything illegal has been done. However, i expected that dividend is an output of profit and a company on the exchange should not choose how much to pay as dividend
Dividend yield is not fixed so there is nothing like "underpayment". Companies determine how much of their profit should go to shareholders (as dividends) and how much should be reinvested in the company. This is subject to shareholders approval though. Companies are not obligated to pay dividends. So it's up to you and I, the investors, to shop for and invest in companies that pay dividends that we are happy with.
@@FloFinance Pls miss flo, can I get your email address. I would like to reach out to you on some project.
The fear of Starlink is making MTN jittery, Elon Musk is the star
The whole import of your analysis depends on the kind of investor you are: long term (valuation) or short term (dividend). And these 2 considerations depend on your need for cash. If you have spare change, then take the leap of fate and invest MTNN. If you are Middle income and need money yearly, then do not invest in MTNN rather Banks.
Very illuminating analysis. Jisike Flo.
🙌 You got it right. Investing is all about the money for me. Otherwise, I'll flex the money or use it for philanthropy. And a charitable organisation, MTN is not. ☺
I do not invest for dividend, if any of my stocks give me dividend, I invest it straight back. There's a difference between growth stocks vs value stocks, the latter are established companies that do the same thing over and over again and pay dividend while growth stocks re-invest the profits and grow the business.
Jeff Bezos didn't pay dividend stocks for Amazon, but promised to make the value of your stocks much higher. Imagine those who bought the stocks at $20, now the stock is worth $3500. Similar with Tesla, $200 last year and grew 500%. While companies like Coca cola etc will give you regular dividends but their stocks won't increase dramatically. I think dividend should be used when you have extra millions to spare or you are retiring and you just want money to be coming in every month without working.
Mehn,this is soooooo educative.Nigerian educational system needs a total overhaul.
Haha. No where in the world is financial/investment education in the school curriculum. We have to learn these for ourselves. Glad you found it helpful.
Seat taken.
I know everyone in this comment section bought MTN shares. Y'all are just in these comments lying and pretending.
How u take know? 😁
Is the offer to finance the 5G license?
Maybe to finance the tax repayment scheme, who knows? 🤷♀️
Flo please come and be my financial advisor 🤲🏾😂😂😂
If I manage your finances, you no go enjoy life ooo. Na investing, investing. No flexing ya money. 😄
This is igbo brain 100% educative but my question is how can someone buy shares from zenith bank or fidelity bank
I wonder if you still have the same opinion about MTN SHARE with the new reality about the Company. I mean with outstanding 2021 performance & total dividends for Y2021 nearing 15naira per share, all indices seem to be on their side with their just release audited result. Im afraid you got it all wrong this time & i am sorry for people that leverage on your analysis to make a no-buy decision.
I think I share your views
Flo original Igbo woman 😂😂😂😂😂
😂😂😂 Igbo woman's brother.
@@FloFinance pls can u assist with d website name u used for the historical share value pls. Thank u