Lasco stock delivers for investors, leads the market in May
Published:Friday | June 3, 2011 | 12:00 AM
Steven Jackson, Business Reporter
Lasco Distributors was the top stock gainer in May, up 75 per cent, which allowed it to beat six other active stocks that made double-digit returns on the Jamaica Stock Exchange (JSE) combined markets.
It meant that investors gained some J$750,000 over 31 days for every million dollars invested in the stock.
Other double-digit gains came from Pulse Investments up 61 per cent, Lasco Manufacturers up 36 per cent, Montego Freeport up 28 per cent, Barita up 26 per cent, Hardware & Lumber up 15.6 per cent and Scotia Investments up some 11 per cent.
Contextually, Ciboney, a near-dormant company, doubled its price to six cents. Market drivers were released financials and small volume trades in Pulse, according to a senior equity trader who opted for anonymity amidst awaiting internal media clearance.
"The Lasco release of higher profits in its financials was consistent with the price rise, heavy volumes and many daily trades," said the analyst, based at a Kingston investment house.
She said Pulse's stock traded only three times in May.
"The first trade gained 13 cent gain, the second had no gain and then the third included 10,000 units at $2.05, gained about 46 per cent," she said. "The rise in price was due to the illiquidity of the stock. The stock appreciated in May but it is a bit deceiving, because the volumes were not there. It doesn't appear that it was influenced by the financials in the way that Lasco's price was affected."
Despite the gains, market capitalisation declined by J$4 billion to $586 billion relative to May 2010 levels, based on JSE statistics.
Meanwhile, stocks that had the greatest price declines included Trinidad Cement down 43 per cent, Scotia Group down 11 per cent, Cable & Wireless Jamaica down 9 per cent, Capital & Credit down 7.8 per cent and Jamaica Broilers down 7.6 per cent.
Lasco Distributors, the pharmaceutical and consumer arm of the conglomerate, recorded a 212 per cent jump in its net income for its March year over year levels. The company benefited from growing revenues, up 15 per cent, while reducing finance costs and impairment losses by some two-thirds over year-earlier levels.
Pulse's stock price is currently in recovery mode: Its May gains came on the heels of a 59 per cent fall in the stock price over 52 weeks. Its latest financials indicated some level of financial stability at the modelling agency with December quarterly net profit up 2.7 per cent to J$130 million.
Pulse's best news, however, relates to the company's net assets that jumped 12 per cent, based on its rising advertising entitlements, to J$1.6 billion.
Barita Investments price rise followed its trend of improved quarterly performance by rocketing March quarterly profit to J$127 million, or 195 per cent higher than year earlier levels.
"We are proud of our success at meeting the numerous challenges in the marketplace and continuing to be a profitable organisation," said chairman Rita Humphries-Lewin in a statement accompanying the results.
"We persist in the active management of our costs, and will keep abreast of market conditions and demands so that we can continue to enhance the performance and profitability of our organisation," she said.