Shares of East Africa’s largest Media Company, Nation Media Group on Wednesday’s trading session plunged to a six year low of Sh90.
The Nairobi Securities Exchange listed firm traded 26,800 shares and fell by 0.55% to close at levels last seen in September of 2009. Over the last one year, the counter is down by approximately -46%.
“Nation Media has slumped -46.33% on a Total Return basis and currently trades on a Trailing PE Ratio of 7.62. Standard Group which self-evidently operates in a similar Media space did not trade and is -40.00% on a Total Return Basis.” Noted Aly-khan Satchu.
In our November Update, we highlighted that NMG’s market cap stood at Sh 65 billion in early 2014 as compared to Sh17.5 billion on Wednesday 7th December 2016.
The company’s traditional businesses are shrinking faster than the new business can make up for, as NMG’s customers shift away from reading newspapers and magazines — the old way of getting news — and turn more to getting information from digital devices.
It’s top line performance remained unchanged during the half year period with the bottom line sinking by 20 percent.
NMG isn’t doing particularly better or worse than any other mainstream media company. Today, most of them are struggling, they are all cutting costs by retrenching and shutting down unprofitable business units.
But if dividends are your thing, Nation Media Group clearly offers a better yield (6.17% as of full year 2015 ) which is well above most NSE listed companies. Note that its dividends have been unchanged since 2013 despite a continuous trend of falling profits.
Nation Media Group Profit After Tax In Ksh
*2011 – 1.2B
*2012 – 2.5B
*2013 – 2.5B
*2014 – 2.46B
*2015 – 2.2B
*HY2016 – 785M
FY2016 -?
— Kenyanwallstreet (@kenyanwalstreet) December 7, 2016
So is NMG a buy while its at a six-year low?
Related;
Standard Group Kenya Revenues Flatter as Print Ad revenues decline
Nation Media Group has shed Over Sh46Bn in Market Cap since 2014
