We can’t deny that the EGX in the last months was mainly for speculation, a direct result of:
– Down-trend in March 2020 – COVID 19 –
– Followed by a horizontal movement between 9800 – 11700 level from April 2020 till March 2022
– Then a down-trend from March 2022 till October 2022
During this period, it was common to assume that the Egyptian market is not suitable for long investment.
While that may be true, I will give you insight on one of the value stocks suitable for long term investment.
Alexandria Mineral Oils Co. (known as: AMOC) is a public company, listed on Egyptian Exchange (EGX) since December 2004. AMOC operates within the coal & consumable fuels sector focusing on energy. AMOC is based in Alexandria, Egypt and was established in May 1997.
Why keep AMOC in your portfolio?
1- AMOC has been in an up-trend since March 2020 – COVID 19 pandemic.
2- Taking into consideration all the obstacles that faced the market during 2021 and the H1 2022, keeping an up-trend is a very positive indicator for AMOC.
3- As per one of Charles H. Dow’s main statements “Trends Persist Until a Clear Reversal Occurs.”
4- AMOC is included in the EGX30 index with a weight of 1.5%.
5- AMOC distributes dividends in the form of cash or free shares, giving investors a secondary source of income.
I will quote the following points from a new post written by Dr. Hany Genena:
– There might be an opportunity for price explosion in the short term.
– The share price has fluctuated between EGP 3.5 and EGP 4 since the beginning of the year, although the price of one of the company’s main products – diesel, which represents 26% of sales – is trading globally near the highest levels as a result of a gap in global supply and the closure of some refining factories in Europe.
– In Q2 of the current fiscal year (October to December 2022), the company is expected to hit a new profits record as a result of
– The rise in the price of diesel globally despite the drop in the oil price, which increases the profit margin (crack spread)
– The rise in the price of the dollar against the EGP has been strong since October, which benefits the company directly because all its products are priced in dollars.
– The company recorded profits of around EGP 1 billion pounds in the last fiscal year, and recorded profits amounting to about EGP 400 million in Q1 2022/23, even before the global diesel prices and the EGP devaluation occurred in Egypt.
From the movement of the stock, I believe that it has not yet responded to these factors, and there may be an opportunity to achieve a return of up to 15-20% as a result of the movement in the stock price towards the level of 4.75-5 EGP before the next earnings release.
Currently, the share is at EGP 4.75, but I still believe there is an opportunity to capture gains from AMOC.
According to http://www.Investing.com the company have the following figures:
– Market Cap 6.02 B
– P/E Ratio 5.04
– Shares Outstanding 1,291,500,000
– Revenue 12.27 B
– Dividend (Yield) 0.55 (11.7%)
– Beta 0.861
– 52 wk Range 3.21-4.87
– 1-Year Change 27.03%
Ownership
• Alexandria Petroleum Co (20.774%)
• Al Ahly Capital Holding Co (17.44%)
• Misr Capital (8.658%)
• Misr Insurance Co (5.479%)
• Social Insurance Fund for Governmental Sector Employees (5.16%)
• Social Insurance Fund for Public and Private Sector Employees (5.00%)
• Misr Life Insurance (4.54%)
• Co-Operation Petroleum Co (3.57%)
• Misr Petroleum Co (3.57%)
• National Bank of Egypt Employees insurance Fund (0.0058%)
As you observed the list of shareholders contains some of the reputable financial institutes in Egypt which reflect the strength of the company and its performance.
This was not written by Thndr and this is not investment advice, you should do your own research before making investment decisions.
