The equities market was on an upward trajectory in a week ended September 9, 2022 with NASI, NSE 20 and NSE 25 gaining by 2.6%, 1.4% and 2.1% respectively, taking their YTD performance to losses of 15.2%, 6.6% and 11.2%, for NASI, NSE 20 and NSE 25, respectively in a week ended September 9, 2022.
According to analysis report by Cytonn, the equities market performance was mainly driven by gains recorded by large-cap stocks such as NCBA, Safaricom, KCB, and Standard Chartered of 9.3%, 4.3%, 3.9% and 1.8%, respectively.
The gains were, however, weighed down by losses recorded by EABL and ABSA which declined by 0.6% and 0.4%, respectively.
During the week, equities turnover declined by 11.1% to Ksh1.6 million from Ksh.1.8 billion recorded the previous week, taking the Year To Date (YTD) turnover to Ksh.72 billion.
Foreign investors remained net sellers, with a net selling position of Ksh72 million, from a net selling position of Ksh.722.2 million recorded the previous week, taking the YTD net selling position to Ksh17.8 billion.
The market is currently trading at a price to earnings ratio (P/E) of 7.6x, 42.5% below the historical average of 12.7x, and a dividend yield of 5.5%, 1.2% points above the historical average of 4.1%.
NASI’s PEG ratio currently stands at 1.0x, an indication that the market is at par relative to its future growth.
A Price Earnings to Growth (PEG) ratio greater than 1.0x indicates the market may be overvalued while a PEG ratio less than 1.0x indicates that the market is undervalued.