Access Holdings has grown into one of Nigeria’s largest financial institutions, with a balance sheet exceeding N53 trillion, the largest among listed Nigerian banks.
However, the market performance of the stock has not fully reflected the scale of that growth, especially when compared with some of its tier-one banking peers within the FUGAZ group.
After falling to a 52-week low of N19.90, Access Holdings shares recovered to N27 as of the close of trading last week, representing a gain of about 36%.
While the rebound has rewarded investors who bought during the decline, the stock remains below its 52-week high of N36.
An investor who bought N1 million worth of Access Holdings shares at N19.90 would now hold shares worth N1.36 million at N27, representing a gain of nearly N357,000 or a 35.7% return.
That performance would have compared favourably with lower-risk alternatives such as Treasury bills and OMO bills over the same period.
If the stock returns to its 52-week high of N36, the same investment would be worth about N1.81 million, representing a potential gain of about N809,000 or an 80.9% return on the original investment.
However, the next phase of the stock journey will depend on whether earnings can justify the recovery.
While Access Holdings has continued to grow profits and expand its balance sheet, the recent share price recovery suggests that investors are still seeking stronger evidence of sustained earnings growth and shareholders’ return.
The stock has gained about 36% from its 52-week low of N19.90, but the recovery has not fully closed the gap with some of its major banking peers.
One possible explanation lies in the pace of recent earnings growth. Access Holdings remains profitable, but the momentum has moderated compared with the exceptional expansion recorded in previous years.
The pressure is even more visible when measured on a per-share basis. While total profit has continued to rise, shareholders are yet to see earnings per share return to previous highs following the increase in shares outstanding after the capital raise.
However, the projected EPS remains below the levels recorded before the capital raise, when earnings per share stood at N17.23 in 2023 and N16.71 in 2024.
So, the challenge now is not simply growing profit; it is growing profit fast enough to offset the dilution from its capital raise.
This suggests that while annualized Q1 2026 profit of about N866 billion points to continued growth, management still has more work to do to restore the earnings-per-share levels that shareholders enjoyed before the capital expansion.
Another factor that may have affected investor confidence is the suspension of dividend payments.
Management said dividends were recommended at both the half-year and full-year 2025 stages, but regulatory approvals were not obtained.
Commenting on the issue, Access Holdings Group Managing Director/Chief Executive Officer, Innocent Ike, said the decision was not a reflection of the bank’s financial strength, noting that:
He added that:
The outstanding issue relates to Section 19(8)(c) of the Banks and Other Financial Institutions Act (BOFIA), which restricts Nigerian banks’ investments in foreign banking subsidiaries to 10% of shareholders’ funds.
Management disclosed that it was working with regulators to close the compliance gap within the timeline provided, as resolving the issue would create room for the resumption of dividend payments.
The group has already taken steps in that direction, including the sale of a 7.44% stake in Access Bank Ghana, reducing its ownership exposure while retaining control of the subsidiary.
For investors, the next major checkpoint will be the group’s Q2 2026 results, which should provide further insight into whether earnings momentum is strong enough to support a stronger full-year performance, while also offering updates on regulatory adjustments and the possibility of restoring shareholder distributions in the second half of the year.
Overall, Access Holdings continues to trade at a relatively low valuation compared with its earnings capacity and balance sheet strength.
However, the low valuation also might reflect investor concerns around the quality and sustainability of future returns, given its trend and the uncertainty around dividend payments.
Notwithstanding, some analysts believe the current gap provides room for upside.
Overall, the next phase will depend on whether management can convert its scale into stronger earnings per share growth, renewed dividend payments, and improved investor confidence.
If earnings accelerate, the regulatory hurdles around dividend payments are resolved, and shareholders begin to see stronger returns, a likely improved investor confidence might push the share price back to its 52-week high and even beyond.
Investors can continue to track Access Holdings’ earnings performance, valuation changes, and broader market opportunities through FTM’ – Follow The Money: Nairametrics Platform.
