About half of the listed equities on the Ghana Stock Exchange (GSE) traded flat since the beginning of the year with no change in price movement from January to August.
Over the period, 16 stocks out of the active 38 listed stocks traded flat whereas the market saw only nine gainers and 12 laggards, reflecting prevailing investor sentiments.
The stagnant stocks include AngloGold Ashanti Depositary Shares (AADS), Agricultural Development Bank (ADB), AngloGold Ashanti Limited (AGA), Aluworks Limited (ALW), Clydestone Ghana Limited (CLYD), Cocoa Processing Company Limited (CPC) and Dannex Ayrton Starwin Plc. (DASPHARMA).
Others are Mega African Capital Limited (MAC), Republic Bank Ghana Limited (RBGH), the ordinary and preference shares of Standard Chartered Bank Limited (SCB) and (SCB Pref), as well as Hords Limited (HORDS), Meridian-Marshall Holdings (MMH), Samba Foods (SAMBA) and Digicut (DIGICUT).
The shares of mining firm Asante Gold Corporation (ASG) were listed on June 29, 2022, at GH¢8.87 and recorded no price change at the end of August. Also, the shares of domestic publishing company – Sam Woode Limited (SWL) – remain suspended from trading on the Exchange since the close of trading on Friday, September 18, 2020, amid an intended restructuring of its operations.
A further perusal of the available data shows the stationary fairly evenly distributed among the 11 sectors captured by the local bourse, with 12 from the main board and four from the six stocks listed on the Ghana Alternative Market (GAX).
The development continues the narrative of the GSE-listed stocks being grossly undervalued when their price-to-earning (P/E) ratios are taken into consideration.
While many investors would refer to 20 to 25 as the conventionally ideal P/E ratio range, with the lower figure being preferred as it points to the earning potential of the stock, less than five of the GSE-listed had a P/E ratio exceeding this band at the end of the period in question, with almost all the stocks trading at a P/E ratio less than 10.
Gainers, losers and market mover
The year-to-end-August price-appreciation pack was led by SIC Insurance (SIC), which was up 287.5 percent, the NewGold Exchange Trade Fund (GLD) at 56.54 percent, Trust Bank Gambia Limited (TBL) with 41.18 percent and Guinness Ghana Breweries Limited (GGBL) at 25 percent.
At the other end of the spectrum, Produce Buying Company (PBC), Fan Milk (FML) and GCB Bank (GCB) had lost 33.3 percent, 25 percent and 22.71 percent, respectively.
The Telco giant, MTN Ghana, which has a market capitalisation of GH¢11.2billion, representing 17.4 percent of the GSE’s market cap has shrunk by 18.02 percent, from GH¢1.11 to GH¢0.91 per share.
The stock, which was responsible for 95.9 percent and 90 percent of the volume and value of shares traded between January and August, has seen its 30 percent localisation policy further drive liquidity off the market, as shares have been offered over-the-counter.
Overall, the volume of shares traded from January to August stood at 1,232, 653,349 valued at GH¢1,237,259,893.31, representing an increase of 232.98 percent and 235.56 percent over the same period last year.