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MTN Nigeria Plc continues to gain traction in the equities market as investors anticipate an earnings rebound in the fourth quarter of its 2024 financial year. The telecom giant has taken strategic steps to address the challenges that impacted its performance in the first three quarters of the year.
Market analysts suggest that the company’s corrective actions have bolstered investor confidence, despite concerns over negative shareholders’ funds. MTN Nigeria is expected to enhance its total equity by securing long-term revenue streams.
The telecom firm successfully met its working capital requirements through a series of commercial paper issuances in the latter part of 2024. However, the negative shareholders’ fund remains a key area of concern.
Recent buying interest in MTN’s stock—albeit slow and steady—has been driven by the renegotiation of tower lease agreements, which previously exposed the company to foreign exchange obligations and other financial risks.
Bullish market analysts project further gains, as expectations of an earnings surprise continue to fuel momentum in the equities market.
On Friday, MTN Nigeria’s share price closed at N264.2 following a last-minute buying spree, with over 1 million shares worth approximately N285 million changing hands on the local exchange.
This one-day rally pushed MTN Nigeria’s market capitalization up by 3.61%, settling at N5.547 trillion. Investors remain optimistic about the company’s future earnings potential, particularly after the recent regulatory approval of tariff adjustments.
“The new tariffs present a significant revenue growth opportunity for telecom operators, prompting a reassessment of our coverage companies,” stated CardinalStone Securities Limited in a research note.
The investment firm predicts that MTN Nigeria stands to gain the most from these tariff hikes, forecasting a 59% surge in revenue for 2025, with a projected medium-term compound annual growth rate (CAGR) of 26.6%.
After three consecutive underwhelming quarterly earnings reports, MTN Nigeria has embarked on strategic restructuring to drive financial stability and long-term profitability.
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