Solidere shares soared
on positive political news
Further increases expected
Solidere’s shares soared this week on the back of a better prospective for the election of a new President. ‘A’ shares jumped 19 percent compared to last week’s closing price and ‘B’ shares surged 21 percent.
However, the shares witnessed a decrease on Friday due to profit taking.
Toufic Karam, Head of Capital Markets at FFA Private Bank, said: “They are expected to rise again if news of political decompression continues to emerge.”
On Friday, the ‘A’ shares closed at $11.47, down three percent, and ‘B’ shares were down 2.9 percent, at $11.58.
The ‘A’ shares had soared 9.6 percent on Tuesday and 9.2 percent on Wednesday. The ‘B’ shares rose 3.3 percent on Tuesday and 14 percent the following day.
“The surge in the volume and prices of Solidere’s shares is due to the easing of the political landscape. We have not seen such prices in the last two years,” Karam said. There was no impact on the shares of banks and other listed companies because Solidere is more sensitive to political news, he said.
Nearly 358,000 ‘A’ shares changed hands on Thursday, which is 32 times the daily average for the summer amounting to around 11,000 shares. The volume of ‘B’ shares shot up 43 times to almost 231,000 shares compared with a summer average of just 5,400 shares.
“The traded volume was huge on Thursday and this only happens on rare occasions,” Karam said.
FFA Private Bank said in a research report released earlier this month that they reiterate their recommendation for Solidere shares at marketweight and reduce their fair value estimate on its shares to ten dollars from a previous estimate of $11.
Solidere declared net profits of $72.1 million in the first half of 2016 from a loss of $28.7 million in the same period last year.
Reported by Shikrallah Nakhoul
Date Posted: Oct 21, 2016