Guaranty Trust Bank Plc has retained its market capitalization of N977.12 billion on the local bourse, after crossing the N1 trillion mark amid renewed buying interests in November.
At the close of trade last month, the last trading session in the month of November, the market capitalization of the bank stood at N977,115,150,236.80.The shares of the bank closed at N33.2 per share, with total shares outstanding is 29,431,179,224.The drive behind these gains buying interests in the shares of the bank were renewed as a result of the long-term fundamental strength of the bank, its impressive financial results in the third quarter of 2020, as well as, the expectations of the bank’s transition into a Holding Company status.
A
structure that will enable the bank to look into other businesses outside its
core business segment, such as payment, asset management, and pension fund
administration, in a bid to boost the company’s intrinsic value and returns to
shareholders.
This
reality and expectation, coupled with the optimism from the Covid-19 vaccines
and the bearish state of the money market in November, triggered buying
interests in the shares of the bank, as the market capitalization of the bank
crossed the N1trillion mark in November.
However,
widespread profit-taking and portfolio rotation by institutional investors on
NSE, led to the retracement of the bank’s market capitalization to the tune of
N977billion to close below the trillion-naira mark in November.
What
you should know At the start of 2020, the widespread pessimism over the
performance of equities owing to the negative impact of the Covid-19 pandemic
on the global economy and performance of equities in the global markets, which
made an impacted on the Nigerian Stock Exchange, triggered a huge sell-off on
the local bourse in the month of March. This development affected the valuation
of companies on the Nigerian Stock Exchange, as their share prices declined
markedly. During this period, the share price of GTBank plummeted, owing to the
huge sell-offs by investors on the NSE. The market capitalization of the bank
fell below N660 billion in March, 2020, as a result. Market capitalization is
the aggregate valuation of a company, based on its current share price and the
total number of outstanding stocks.
Market
capitalization tells how much investors value a company, and gives an idea of
what a company is worth on the stock exchange, as well as investors’ perception
of a company’s future prospects.
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