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Zenith Bank Audited FY 2025 earnings review · Green Ticker Tales

• 0:00
  all right good evening here is a walkthrough audited fi 2025 numbers for um zenith bank now i'm not going to go too heavy into the details because the video is up and i would include a link to the video um here but i'm just going to look at the essential numbers that we've had um so far as well as how i think the stock will trade oh yeah i think this company will trade
• 0:26
  in the next uh one year so what do you have for fy2025 uh you had a profit after tax of 1.04 trillion uh flatties even though it's all by 0.74 percent but that's a marginal increase and that you had any special 25 now 32 couple uh that was down 22.9 percent um year on year and in case you're wondering our profit is flattish but any eps is down that's because you have a higher number of
• 0:55
  outstanding shares i think the key number that stood out for me for this firm the red flag the only red flag in these numbers are impairment charges this is the third straight year of back-to-back heavy impairment charges 2025 we had impairment charges of 742 billion um naira uh 2024 that was at 657. uh i think 2023 was around 300 and something billion of 400 and something billion and so
• 1:24
  is this a new normal are we going to see these figures taper down and if they are going to taper down they're going to taper down to where um two key numbers or maybe three key ratios are discussed 45.15 percent cost to income ratio means that for every hundred naira in revenue 45 went to cost um and that's understandable because year on year operating income is up by six percent um but operating expenses grew at 23.26 um percent
• 1:54
  So when you have your operating expenses grow faster than your operating income, obviously it means that your cost-to-income ratio will drop. Return on assets at 3.31% down year-on-year, slightly down year-on-year, while return on equity at 21.1%. 21.1% return on equity means that for every 100 Naira invested, you get a return on 21 Naira, which isn't too bad. But for 2024, that was 25.6 Naira. And in case you're wondering, why did you have that dip?
• 2:23
  and you return on asset and return on equity is quite simple if you have your profits essentially flat and you have a higher growth in assets and you had the higher growth in equity then those numbers would dip so that's perfectly understandable i think you're going to see a rebound in these numbers um in the coming or within the current financial year as the firm will probably has a year to sweat some of those capital it has
• 2:51
  raised um the company has proposed or the bank has proposed the final dividend of 1875 couple that brings the total dividends to 10 naira share um last year or in 2025 depended interim dividend of 1925 cover for 2025. uh qualification date is april 24th and 26th and the payment date is may 5 20 26. uh so the qualification that is the date in which you have on the date
• 3:18
  on or before which you have to hold those shares to get a dividend while the payment it is when the cash actual dividend lands your bank account as some might say the dividend yield is small i don't think so uh the stock price has rallied sharply in the last time even this year yeah 2020 here today the stock is up about 77 percent last one year april last year to a pretty set the stock is all by over i think over 130 something percent so this stock has run hard this stock has run hard
• 3:48
  and in any case between now and april 2020 april 24 when i'm in the column is the qualification date you can see the price go up or price go down um if you'd like more context as to historicals you can go check out the video on youtube i don't want to make this too long i'm already four uh minutes in but i'll focus on the forecast here i think that's probably the most important page after the result review i think and i've worked out some numbers
• 4:17
  My forecast book value per share for 2026 is 134.2. Now, if we assume that this stock should trade at 1.2 times book value, that gives me a target price of 161 Nairai share, which I think is doable because I see no reason why this stock should trade below book value. And I see no reason why this stock cannot grow its book value. So if you have 2025 book value at 115, the question is model whatever you think that growth is going to be.
• 4:46
  Is it going to be 10%? Is it going to be 20%? Model that growth, work out your numbers, and work out your book value. But for me, where the excitement is, or where I'm going to be excited about this stock, I'm not really, I'm not focused on 2026. That's a one-year holding timeframe, or even 2027. I'm focused on 2028. At 2028, I expect the book value to be at 168 Nairai share. And at the 1.2 book value target price, I think this stock will trade at 202 Nairai share.
• 5:16
  i mean the stock is 112 so imagine the growth between 112 to 202 uh in just what maybe two years all things being called satirist variables the satirist variables factors or the key factors to watch out for are stable macros and a fairly stable um banking environment if you have those then i think there should be no reason why this stock shouldn't be trading at 200 share so i think worst case scenario
• 5:43
  we should probably see these stocks trading at somewhere between 130 150 by year end ladies and gentlemen thank you for listening for more context go check out the youtube video i'd include the link and see you in tomorrow's episode