UBA hits all-time high and rises above N35 following strong results in the third quarter

United Bank for Africa (UBA) rose to an all-time high on the trading day ending November 5, 2024, closing at N35.05 per share, driven by strong bullish momentum.

This increase follows the bank’s impressive third quarter 2024 results, which revealed a 101.88% year-on-year increase in pre-tax profit to N194 billion, bringing the nine-month total to N603.483 billion.

Since the release of Q3 results on October 21, 2024, UBA shares have attracted renewed investor interest, contributing to a significant year-to-date gain of 38.40%.

The stock, which was at N26.50 on the day of the announcement, closed October at N29.80. At the beginning of November, the bullish trend took it above the N35 threshold, setting an all-time high.

Market Trends

UBA started the year at N25.65, indicating a continuation of the upward trend compared to the previous year. However, at the close of January, the stock fell slightly to N24.40.

• February brought further declines, but in March the stock rebounded sharply, erasing earlier losses with a gain of 24.16%.
• Despite the optimism, the recapitalization news in April set off a period of decline and the share price fell to N20.30 by the end of July.
• From August onwards, UBA’s shares soared and closed the month at over N22 per share with a strong trading volume of 510 million shares.
• As of September, the stock reached N28.30 and as of October, it closed above N29 with a trading volume of 1.15 billion shares.
• The resurgence reached its peak this November; UBA shares crossed the N35 limit on the 5th of the month, indicating that investor confidence is strong.

Key Factors of the Uplift Feeling

• The renewed bullish sentiment in UBA shares is in line with broader trends in the Nigerian banking sector. Following a mid-year market downturn that wiped out earlier gains, August brought consolidation across the sector, reigniting investor confidence.

• During this period, UBA’s increasing trade volumes paved the way for its remarkable rise. Additionally, the bank announced a leadership change in September, further boosting market sentiment.

• However, the key catalyst was the declaration of an unprecedented N2 per share interim dividend for shareholders, the highest payout among Nigerian banks in the first half of 2024. This announcement, along with UBA’s stellar Q3 results, boosted investors’ confidence.

• The third quarter report disclosed that profit before tax increased by 101.88% year on year to N194 billion. Profit before tax in nine months increased to N603.483 billion compared to N502.091 billion in the same period in 2023.

• This performance resulted in increased market activity, with daily trading volumes exceeding 200 million shares on November 4 and 5.

Manager’s Opinions

Commenting on the results, Ugo Nwaghodoh, UBA Executive Director of Finance and Risk Management, said:

“I am pleased with the milestone achieved in improving operational efficiency, which is reflected in the normalization of the cost-income ratio around 50%. “We continue our way with various strategies to optimize our cost of funds and operating expenses.”

UBA’s strong performance and strategic decisions have been reflected in the increase in share prices and increased investor confidence, strengthening its position in the Nigerian banking sector.

---

Follow us for Breaking News and Market Intelligence.