The share price of the United Bank for Africa Plc has risen 95 percent in one year, attracting analysts’ recommendation.
After years of being undervalued, UBA shares have been receiving significant attention from local and foreign investors even as financial analysts back the positive market sentiment and continue to recommend a buy rating on the stocks.
Analysts at Chapel Hill Denham recommended UBA shares with an estimate of N28.30 on its share price. For analysts at Afrinvest, UBA’s share price can go up to N19.10 per share from its current N14.90 per share.
For Meristem analysts, the shares can go for as high as N15.16 per share while earlier recommendations by analysts at Stanbic IBTC and FBN Quest see UBA shares going for N16.20 and N21.90 per share respectively.
For an extended period of time, UBA shares have not reflected the bank’s true intrinsic values which lead to a situation where investors seemed to overlook its strong fundamentals and potential.
However, recent developments have spurred renewed interest in the stock which is a testament to the fact that market participants are now taking notice of the bank’s untapped potential and strong growth prospects.
The positive trajectory of UBA’s stock can be attributed to the bank’s strategic positioning, coupled with a robust financial profile and strong corporate governance practices, have contributed to its attractiveness among investors.
The bank’s first quarter (Q1) financials reveal that profit before tax rose 38.2 percent to N61.4 billion in Q1 2023 from N44.5 billion recorded in the same period of 2022.
In the same vein, UBA’s profit after tax climbed 29 percent to N53.6 billion from N41.5 billion.
Analysts say the bank recorded one of the best performances in the first quarter which has drawn more attention to its stocks.
UBA stated that its innovative approach to digitisation, coupled with an experienced and visionary management team, has bolstered confidence in the bank’s ability to navigate the evolving financial landscape successfully.
The recent surge in interest from foreign investors signifies a growing recognition of UBA’s potential beyond local borders.
The bank’s strong presence in 20 African countries has made it an attractive investment option for those seeking exposure to the continent’s rapidly developing markets.
Analysts have further validated the rising interest in UBA shares, offering a ‘buy’ recommendation based on the bank’s strong fundamentals and favorable market dynamics.
UBA stands poised to benefit from the increasing demand for financial services in Africa as the economy continues to recover from the global challenges of recent years.
As UBA shares garner increasing attention, the bank said it looks forward to leveraging this new found momentum to further strengthen its position as one of the leading financial institutions in Africa.