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Top 10 stocks that disappointed investors in 2016

By Patrick Alushula | Published Sat, December 31st 2016 at 00:00, Updated December 30th 2016 at 19:16 GMT +3
Nairobi securities Exchange (NSE)trading floor. (Photo: Beverlyne Musikli/Standard)

The Nairobi Securities Exchange (NSE) sustained its bearish run in 2016 condemning 59 stocks into red. Only five stocks survived the headwinds to shoot into the green. KenolKobil has gained 46 per cent while Kenya Airways has grown its share price by 22 per cent. Safaricom follows by 15 per cent gain. Longhorn Publishers (8 per cent) and British American Tobacco with 7 per cent gain closes the list of the stocks that avoided the red in a year that saw value of transactions also drop.

Since January, most of the sectors have lost at least a third of their share value. Against this backdrop, here are the stocks that bled most as at December 20, 2016 data.

1. Uchumi ( -71 pc)

Unlike in 2015 when the stock featured in top 15 gainers, the stock has eroded all the gains it had made. It now trades at Sh3.15 compared to the close of 2015 when it averaged Sh10.85. According to Maurice Oduor, an investment manager at Cytonn Investments, the share is suffering from lack of clear strategy from the company as well as the past corporate blunders that are still making headlines.

2. Kapchorua Tea (-60 pc)

Last year, the share had put a smile on its investors’ face by gaining 46 per cent to emerge the third highest gainer on the bourse. This year, it has engaged a reverse gear and lost 60 per cent of its share price. It currently trades at Sh179, down by Sh268.50.

3. National Bank (-57 pc)

Its share ran into the headwinds of Brexit, poor financial performance and the interest rate cap to shed off more than half (57 per cent) of its value. At Sh6.85, the value lost this year has condemned it to be the poorest performing bank stock on NSE this year. In March, the bank posted a full year loss of Sh1.2 billion as part of its management was sent parking. In half year, it saw Sh15 billion deposit flight in just three months.

4. Sanlam Kenya (-54 pc)

The insurer, which re-branded from Pan Africa Insurance Holdings in mid-August has seen its share price more than half (54 per cent drop) in 2016 to Sh27.75. Having closed the year with a profit warning, the group went ahead to prove the rocky year by posting a 97 per cent decline in its earnings. The firm has once again has issued a profit warning for the third year in a row as the investment environment got bleaker for the financial provider. Sanlam expects its profit after tax to fall by a quarter following a decline in premiums from its life business.

5. Nation Media Group (-53 pc)

The share of the largest media house in the region has taken a beating with the closure of three media outlets followed by job cuts. At Sh90, the share has more than halved in price from about Sh190 in January. The firm has announced that it will cut jobs again in January as part of the final phase of re-organising the business. This may subject the share to another stress.

6. Williamson Tea (-53 pc)

From a more than 50 per cent gain last year, the stock has wiped out the entire gain, sinking by 53 per cent. This means that those who bought the share in January hoping for another stellar performance have lost out. At the current price of Sh179, for every share sold, investors lose Sh205 when compared to its value in January.

7. Portland Cement (-53 pc)

The cement maker’s stock has once again sunk into the red. Unlike last year when one-off gain from sell of land to government lifted its earnings, the firm posted a 42 per cent drop in earnings this year in the wake of boardroom wars and industry challenges. Whereas Cytonn analysis tips stocks in construction sector to rebound pegged on increased demand for materials such as cement to drive infrastructural developments, it says that Portland may have to put its boardroom in order first.

8. Home Africa (-52 pc)

Having shed 37 per cent in 2015 to be the 12th highest loser on the bourse, Home Afrika has maintained a dismal run shedding its share by a further 52 per cent. It is now priced at Sh1.25 and it seems headed for a ‘penny stock’ status. In December 2014, the share price of the now loss-making property developer was valued at Sh4.10.

9. Limuru Tea (-51 pc)

From last year’s 40.7 per cent gain that booked it the top five gainer on the bourse, the stock has watered down all that gain this year. It has lost 51 per cent of its value and now trades at Sh530. For every share that an investor may want to sell now, he or she will suffer a loss of Sh555.

10. Housing Finance (-46 pc)

Last year, it more than halved its share price to close the list of top five stocks that shed most value. This year, the stock has continued to head south, losing a further 46 per cent.

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