On Friday, the Dow index dropped more than 900 points, posting its worst intraday performance since October 2020. The other broader stock market indices, the S&P 500 and the tech-heavy Nasdaq Composite, also declined. The not-so-promising corporate earnings and the prospect of rising interest rates made investors worried.
The over-the-Counter (OTC) securities are not listed on the standard exchanges like the New York Stock Exchange or the Nasdaq, usually to avoid the exchanges’ stringent exchange requirements. Although deemed more volatile than the standard exchange securities, not all OTC stocks are bad investments. Moreover, with retail trading still holding strong, above pre-pandemic levels, several fundamentally sound OTC stocks might potentially soar in the near term.
Thus, we think fundamentally sound OTC stocks Anglo American plc (NGLOY), ITOCHU Corporation (ITOCY), Astellas Pharma Inc. (ALPMY), A.P. Møller - Mærsk A/S (AMKBY), and MTN Group Limited (MTNOY) might be solid investments this month.
Anglo American plc (NGLOY)
NGLOY operates as a global mining company. The company engages in the exploration of rough and polished diamonds, copper platinum group metals (PGMs), and metallurgical and thermal coal. The company is headquartered in London, the United Kingdom.
For the fiscal year ended December 31, revenue increased 63.3% year-over-year to $41.55 billion. Profit attributable to equity shareholders of the company rose 309.9% from the prior year to $8.56 billion. EPS came in at $6.93, up 310.1% from the prior year.
The consensus revenue estimate of $42.10 billion for the fiscal year 2022 indicates a 1.3% year-over-year increase.
The stock has gained 14.6% over the past six months and 7.1% year-to-date to close Friday’s trading session at $22.03.
NGLOY’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of A, which equates to a Strong Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, with each factor weighted to an optimal degree.
NGLOY has a Value grade of A and a Stability and Quality grade of B. In the 37-stock Industrial – Metals industry, it is ranked #5.
Click here to see the additional POWR Ratings for NGLOY (Growth, Momentum, and Sentiment).
ITOCHU Corporation (ITOCY)
ITOCY is an industrial company that trades, imports, and exports various products globally. The company operates through the Textile; Machinery; Metals & Mining; Energy & Chemicals; Food; General Products & Realty; ICT & Financial Business segments. The company is headquartered in Tokyo, Japan.
On April 5, ITOCY announced that it would acquire a majority of issued shares in DOME Corporation, the Japanese distributor of Under Armour, Inc. The company is expected to own and manage DOME and Under Armour. This is expected to enhance the company’s corporate value.
On March 29, ITOCY announced that it had invested in drone development and manufacturing company Wingcopter GmbH and established a capital and business alliance with the company through ITOCHU Europe PLC. This alliance is expected to expand its sales and build a drone delivery network.
For the nine months ended December 31, ITOCY’s revenue increased 19.8% year-over-year to $79.06 billion. Gross trading profit improved 11.7% from the prior-year period to $12.72 billion, while Net profit attributable to ITOCY stood at $5.90 billion, up 86.3% from the same period the prior year.
Analysts expect ITOCY’s revenue to increase 186.6% year-over-year to $94.20 billion for the fiscal year ended March 2022.
Over the past six months, ITOCY has gained 8.5% to close Friday’s trading session at $61.43.
It’s no surprise that ITOCY has an overall A rating, which translates to Strong Buy in our POWR Rating system.
ITOCY has an A grade for Stability and a B grade for Growth, Value, and Momentum. It is ranked #3 out of the 38 stocks in the Industrial – Manufacturing industry. The industry is rated B.
To see the additional POWR Ratings for Sentiment and Quality for ITOCY, click here.
Astellas Pharma Inc. (ALPMY)
ALPMY, headquartered in Tokyo, Japan, manufactures, markets, imports, and exports pharmaceuticals worldwide. The company’s offerings include XTANDI, an androgen receptor signaling inhibitor for prostate cancer, and XOSPATA, an inhibitor for adult patients with relapsed or refractory acute myeloid leukemia.
On April 13, ALPMY and Seagen Inc. (SGEN) announced that the European Commission (EC) approved PADCEV (enfortumab vedotin) as a monotherapy for treating adult patients with locally advanced or metastatic urothelial cancer. This might prove to be beneficial for the company.
For the nine months ended December 31, ALPMY’s revenue increased 5.5% year-over-year to ¥992.29 billion ($7.71 billion). Core operating profit and core EPS stood at ¥220.05 billion ($1.71 billion) and ¥91.57, up 8% and 2.1% from the prior-year period.
Street revenue estimate for the fiscal year ended March 2022 of $10.28 billion reflects a rise of 105% year-over-year.
ALPMY’s shares have gained 2.4% over the past year and marginally over the past five days to close Friday’s trading session at $15.90.
This promising prospect is reflected in ALPMY’s POWR Ratings. The stock has an overall A rating, equating to Strong Buy in our proprietary rating system.
ALPMY has a Value and Stability grade of A and a Quality grade of B. In the 169-stock Medical – Pharmaceuticals industry, it is ranked #6.
Click here to see the additional POWR Ratings for Growth, Momentum, and Sentiment for ALPMY.
A.P. Møller - Mærsk A/S (AMKBY)
AMKBY operates as a global integrated transport and logistics company. The company, based in Copenhagen, Denmark, operates through the broad segments of Ocean; Logistics & Services; Terminals & Towage; and Manufacturing & Others.
For the fiscal fourth quarter of 2021, AMKBY’s revenue increased 64.4% year-over-year to $18.51 billion. EBITDA rose 194.7% from the prior-year quarter to $7.99 billion, while profit for the period came in at $6.11 billion, registering an improvement of 369.6% from the prior-year period.
Street expects AMKBY’s revenue to increase 48.2% from the same period the prior year to $18.44 billion for the fiscal first quarter ended March 2022.
The stock has gained 11% over the past year and 3% over the past five days to close Friday’s trading session at $13.68.
AMKBY has an overall A rating, which translates to Strong Buy in our POWR Ratings system. AMKBY has an A grade for Growth and Value and a B grade for Momentum and Quality. It is ranked #1 out of the 45 stocks in the Shipping industry. The industry is rated A.
Click here to see the additional POWR Ratings for AMKBY (Stability and Sentiment).
MTN Group Limited (MTNOY)
MTNOY is a company operating in the telecommunications industry. It offers data, voice and SMS, digital and fintech, wholesale, interconnect and roaming services, and mobile devices. The company is based in Johannesburg, South Africa.
On March 3, MTNOY and Rakuten Symphony signed a Memorandum of Understanding (MoU) for conducting live 4G and 5G OpenRAN Proof of Concept (PoC) trials in South Africa, Nigeria, and Liberia based on the Rakuten Communications Platform (RCP). This partnership is expected to provide cost efficiencies that would help the company deliver an enhanced customer experience.
For the fiscal year ended December 31, MTNOY’s revenue increased 1.3% year-over-year to R181.65 billion ($11.62 billion). The company’s headline earnings and headline EPS improved 32% and 29.8% from the prior year to R17.78 billion ($1.14 billion) and 962 cents.
The consensus revenue estimate for the fiscal year ending December 2022 of $13.14 billion indicates an 8.6% year-over-year rise.
Over the past year, MTNOY’s stock has gained 69.6% to close Friday’s trading session at $10.97. It has gained 18.3% over the past six months.
MTNOY has an overall rating of A, equating to Strong Buy in our proprietary rating system. The stock has a Growth, Value, Stability, and Quality grade of B. It is ranked #2 out of 47 stocks in the Telecom – Foreign industry. The industry is rated A.
In addition to the POWR Rating grades we’ve stated above, one can see MTNOY ratings for Momentum and Sentiment here.
NGLOY shares were trading at $21.10 per share on Monday afternoon, down $0.93 (-4.22%). Year-to-date, NGLOY has gained 6.06%, versus a -9.50% rise in the benchmark S&P 500 index during the same period.
About the Author: Anushka Dutta
Anushka is an analyst whose interest in understanding the impact of broader economic changes on financial markets motivated her to pursue a career in investment research.
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