Access Holdings Plc

ACCESSCORP · NGX · Banking 

MARKET PRICE

₦24.00

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NIGERIA MARKET CONTEXT

Risk-Free Rate (FGN 10yr)

14.85%

Equity Risk Premium

9.49%

Cost of Equity (Ke)

21.0185%

VALUATION SIGNAL

SELL

Our valuation prices Access Holdings Plc below the current NGX market price. Adjust growth inputs if faster dividend growth is expected.

-21.2%

vs. fair value

CONSTANT GROWTH DDM

₦16.32

-32.0% vs NGX price

P₀ = D₁ ÷ (Ke − g)
₦2.12 ÷ (21.0185% − 8%)
= ₦16.32

TWO-STAGE DDM

₦21.51

-10.4% vs NGX price

Stage 1: g = 18% for 5 years
Perpetual: g = 8%
Fair value: ₦21.51

COMPOSITE FAIR VALUE (AVERAGE OF BOTH MODELS)

₦18.91

OPPORTUNITY COST COMPARISON

Fair value

₦18.91

Current price

₦24.00

Signal

SELL  (-21.2%)

T-bill alternative

22.52% risk-free

ACCESSCORP dividend yield

7.50% (₦1.80 / ₦24.00)

Gap to beat T-bill

+15.0% capital gains needed

For ACCESSCORP equities to beat T-bills at current prices, the stock must deliver 15.0% in capital appreciation on top of its 7.50% dividend yield — a total return of 22.52%.

Two-Stage DDM — Dividend Schedule

Year	Stage	Growth	Dividend	Discount Factor	Present Value
1	Stage 1	18.0%	₦2.12	0.8263	₦1.76
2	Stage 1	18.0%	₦2.51	0.6828	₦1.71
3	Stage 1	18.0%	₦2.96	0.5642	₦1.67
4	Stage 1	18.0%	₦3.49	0.4662	₦1.63
5	Stage 1	18.0%	₦4.12	0.3852	₦1.59
TV	Perpetuity	8.0%	₦4.45	0.3852	₦13.16 (TV=₦34.16)

WACC Breakdown

Market Cap₦753.50B

Total DebtN/A (bank)

Equity Weight (We)100.0%

Debt Weight (Wd)0.0%

Cost of Equity (Ke)21.02%

WACC21.02%

Sensitivity Analysis — g₁ vs g₂

₦17g₁=14.0 g₂=6.5

₦18g₁=14.0 g₂=7.3

₦19g₁=14.0 g₂=8.0

₦19g₁=14.0 g₂=8.8

₦20g₁=14.0 g₂=9.5

₦19g₁=16.0 g₂=6.5

₦19g₁=16.0 g₂=7.3

₦20g₁=16.0 g₂=8.0

₦21g₁=16.0 g₂=8.8

₦22g₁=16.0 g₂=9.5

₦20g₁=18.0 g₂=6.5

₦21g₁=18.0 g₂=7.3

₦22g₁=18.0 g₂=8.0

₦22g₁=18.0 g₂=8.8

₦23g₁=18.0 g₂=9.5

₦21g₁=20.0 g₂=6.5

₦22g₁=20.0 g₂=7.3

₦23g₁=20.0 g₂=8.0

₦24g₁=20.0 g₂=8.8

₦25g₁=20.0 g₂=9.5

₦23g₁=22.0 g₂=6.5

₦24g₁=22.0 g₂=7.3

₦25g₁=22.0 g₂=8.0

₦26g₁=22.0 g₂=8.8

₦27g₁=22.0 g₂=9.5

Nigeria-Specific Risk Factors

01

Naira devaluation risk. All dividends are naira-denominated, but Nigeria's exchange rate has moved from ₦460 to ₦1,614/USD in two years. Real value of dividend income for dollar-benchmarked investors erodes rapidly.

02

High risk-free rate compresses all valuations. With FGN bonds yielding 14.85%, the Ke−g spread is narrow. A 100 bps CBN rate rise cascades through Ke and sharply reduces intrinsic values.

03

Inflation distorts growth assumptions. Nigeria's inflation recently exceeded 34%. A 8% perpetual growth rate may represent negative real dividend growth. Always compare to current CPI.

04

NGX liquidity and data quality. Many NGX stocks have thin volumes, wide bid-ask spreads, and delayed financial reporting. Companies frequently defer dividends based on CBN regulations or recapitalisation requirements.

Owo provides financial modelling for informational purposes only. Not investment advice.