This article was written on November 9th, 2020, when CIE's share posted its longest bullish run since the beginning of the year and posted a share price of 1,495 FCFA (2.705 USD) for a PER of 12.81.

At yesterday's closing price (November 16th, 2020), the stock price reached 1,250 FCFA (2.262 $) with a PER of 10.71 or 29% below the company's historical average price over the last 5 years; which implies that the stock is still far from its full growth potential.

On May 25th, the Sikafinance team published a report entitled "WHY INVEST IN CIE".

Six (6) months after this release, CIE share price is in a strong upward trend and nothing seems to slow down this bullish sprint.

The new management team has taken over the company, the concession contract has been extended and the results have been fixed, a cocktail that make investors smile.

On May 25th, the Sikafinance team published a report entitled "WHY INVEST IN CIE".

Six (6) months after this release, CIE share price is in a strong upward trend and nothing seems to slow down this bullish sprint.

The new management team has taken over the company, the concession contract has been extended and the results have been fixed, a cocktail that make investors smile.

A real positive trend took place on CIE in the wake of the release of the first semester results.

All the fears accumulated in recent years, linked to the renewal of the concession contract between the State of Côte d'Ivoire and CIE, have seen their end on September 30th.

Indeed, the announcement of the extension for a period of 12 years to one month from the end of the contract was a deliverance for the shareholders, especially as the excellent financial communication made by CIE on the stock exchange was of an undeniable contribution to maintain the confidence of the shareholders.

Investors, who were thus timid and defensive since the sales frenzy born from the spread of Covid-19, returned to buy the stock propelling the stock price to its highest of the year. The stock has thus registered a 44% increase in just 14 trading days (from October 26th to November 9th), as to signal the return of investors on the value.

 +20% of net income in 1st half

This renewed confidence is justified not only by the renewal of the contract with the government, but also by the excellent results that are on the horizon under the leadership of a management that has managed to maintain the course of performance while the health crisis had raised some fears.

After an increase of 32.54% to 6.5 billions CFA (11,762,400 $) of the net profit in 2019, the company has continued on its dynamic with an increase of 20.2% to 3.66 billions CFA (6,623,000.1 $) of its profit at the end of June 2020 compared to the 1st semester 2019.

This is an important development that reflects a good ownership of the company by the new management team installed since mid-2019.

Led by Ahmadou Bakayoko, a graduate of the Ecole Polytechnique de Paris (French National Institute of Technology) who went through an American investment fund, then Canal+ Group before making a remarkable transition as head of the RTI (Ivorian public television), the new management should succeed in producing a beautiful 2020 vintage for shareholders.

The basis of any successful business is the competence of its management. Managers ultimately make strategic decisions and thus have a crucial influence on the company's future. During his time as head of the RTI, Ahmadou Bakayoko, had managed to increase the result of this public company from 769,5 millions FCFA (1,392,487.2 $)  in 2014 to 3,28 billions FCFA (5,935,488 $) in 2018.

A dividend set to rock the market in 2021

 CIE is one of the few listed companies to have always paid dividends, regardless of the economic and political context in Cote d'Ivoire.

Over the last ten (10) years, the company has thus made its investors earned a surplus value of 233% (in total return) representing a 23% average per year, despite the decrease of the current price. This situation undoubtedly reflects the resilience and the confidence that investors put into the company.

Offering an average return of 7% over the last 10 years, CIE should make investors shudder in 2021 especially since the company has always been generous with its shareholders by distributing 100% of its results.

Publié le 17/11/20 18:16

Ahmed Diallo