Following the decimation of the local equity markets by COVID-19, which saw a loss of 25 per cent in the overall index value, investors are looking for ways to rebalance their portfolio and recover some value which was lost in the year.

The year 2020 started off on a massive high with 16 expected listings and TransJamaican Highway Limited raising $14.1 billion in the largest-ever public listing on the Jamaica Stock Exchange’s (JSE) history.

However, the novel coronavirus pandemic and subsequent events, which included the Bank of Jamaica’s dividend restrictions, saw the market going down as far as 30 per cent which left it as the second-worst performing exchange in the world.

However, during that storm, some stocks rose ahead of the noise. Pulse Investments Limited was the big winner during 2020 as the company’s stock split and record-breaking financial year saw its stock price rise by 222 per cent to $4.83 on a split adjusted basis.

Ciboney was the other triple-digit riser going up by 100 per cent. Eppley Limited, Key Insurance Limited, Margaritaville Turks Limited (JMD Stock) and Mailpac were the other best-performing stocks in 2020.

With 2021 as a year of recovery and some companies poised for massive moves, Sunday Finance examines 10 companies which cover a wide range of firms including newly listed ones to anti-COVID one’s which aren’t directly tied to the economy. 

First Rock Capital Holdings Limited (FIRSTROCK) —The brainchild of Ryan Reid and Dr Michael Banbury, First Rock has had a stable financial year (FY) after being the first company to get listed in 2020. Although the company listed at book value and has been trading below that IPO price, it has been making significant strides in making its mark for an entity operating for less than two years.

Apart from generating US $2.4 million (JA$343.12 million) in the first nine months as net profit, First Rock entered several development projects and began its first successful private equity venture in the form of Dolla Financial Services. With potential acquisitions in the pipeline and the company seizing several undervalued assets in 2020 while trading at a discount to book value, First Rock has great prospects for 2021 especially with a quarterly tax-free dividend. 

Sygnus Credit Investments Limited (SCI) — The private credit outfit, which is entering its fourth year of operation, has made its presence known on the local market and had confidence to do an additional public offering (APO) near the end of 2020. The APO was upsized from the US$22 million with the company planning to utilise debt financing for 2021 to grow its balance sheet past the US$100-million target needed to get a credit rating. When one considers that SCI hasn’t had a single non-performing investment, especially through COVID-19, speaks to the capacity of the company to deliver value. With the company’s bottom line expanding at a similar rate of its balance sheet growth, SCI is poised to take off further in 2021 and provide the necessary financing for companies to navigate COVID-19 successfully. 

Mailpac Group Limited (MAILPAC) — Mailpac was the perfect anti-COVID stock in 2020 as the company’s business thrived due to the lockdown measures and fears of contracting the virus. With each quarter surpassing each successive one, a near 100 per cent dividend payout, new warehouses and a solid Pricesmart agreement, Mailpac is a firm that will serve investors well especially as the company looks to the region for continued growth. 

GraceKennedy Group Limited (GK) — GK proved that its diversified operations across multiple jurisdictions and segments especially in food and money services has delivered solid returns to shareholders in 2020. With the company’s nine months earnings growing by 35 per cent and surpassing the 2019 earnings, GK is set to have its best year on record.

This on the backdrop of its acquisition of Key Insurance Limited which it is slowly transforming into a money maker for the group. With the formation of a Mergers and Acquisitions Unit, a price to earnings (PE) ratio of 10 times and several overweight recommendations by brokerage firms including one CEO, GK should be a company to watch in 2021. 

Jamaica Broilers Group (JBG) — Despite the tourism market still below normal performance, schools closed, curfews in place and no mass entertainment events, JBG has managed to defy many naysayers as it grew its net profit by 51 per cent in six months while having its revenue mute in growth. This speaks greatly to the company’s ability to manage costs and navigate its way through the COVID-19 environment among Jamaica, Haiti and the United States of America (USA). With home consumption growing as more people stay home and the tourism market slowly creeping back up, JBG is a small giant to watch.

Derrimon Trading Limited (DTL) — Derrimon is having its APO right now which is fully underwritten by Barita to the tune of $3.5 billion with an upsize potential of up to $4.22 billion. The company has scaled several barriers since listing in 2013 and will be engaging in a total rearrangement to take their business to the next level. With a significant debt reduction, two acquisitions in the USA and several other prospective options with a 50 per cent tax remission, DTL should be on everyone’s radar right now. 

Caribbean Cream Limited (KREMI) — Kremi has been one of the biggest winners thanks to COVID-19 as people stay home and look for comfort food. In their second quarter, the company was able to generate as much profit in three months compared to its entire 2020 FY. With two months remaining in the 2021 FY and the company setting new heights plus a recent land acquisition, Kremi is a major winner of the stay at home economy. 

The Limners and Bards Limited (LAB) — The LAB was able to deliver a huge 44 per increase in revenue and 34 per cent growth in net profit for its 2020 FY which included the company becoming more remote and disposing of a building plus a sizeable amount of long-term debt. With $380 million in cash, the company is paying a $70.9 million dividend which includes a special dividend late this month. With CEO Kimala Bennett guiding the company forward, the LAB is an interesting anti-COVID stock in a time where communication is key. 

Pulse Investments Limited (PULSE) – Pulse delivered a superb financial year, paid down its $250-million five-year global bond in under a year and has begun its real estate project. With an APO on the horizon and more than 200 per cent in gains to investors over 2020, Pulse is definitely a company to monitor as it presents trading opportunities to investors. 

Seprod Limited (SEPROD) — With the sugar subsidiary no longer holding the company down, Seprod has triumphed under the pandemic and has been growing its exports at a steady rate. Every quarterly net profit in 2020 performed greater than the entire 2019 FY, which speaks to the company’s current trajectory for 2021. As one of the stocks to perform above the market in 2020, the Richard Pandohie-led firm should move mountains going forward.