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PZ Cussons Plc has delivered higher returns to shareholders in the form of share appreciation than peer rival Unilever Nigeria Plc as the Home and Personal Care (HPC) producers have surmounted the tough and unpredictable macroeconomic environment.
PZ has returned 192 percent in the last three years while Unilever has delivered only 33 percent, according to a recent report by Chapel Hill Denham Limited.
The research house added that the premium investors pay on Unilever over PZ had shrunk 19 percent from its peak of 452 percent in July, 2019.
However, Unilever has a stronger balance sheet and more consistent earnings growth than PZ.
For instance, Unilever’s HPC revenue has grown at a stronger CAGR 28.60 percent over 2020-2022, compared to 4.40 percent for PZ, according to data from Chapel Denham.
For a calendarised year (CY) basis, Unilever’s margin has been on an upward trajectory compared to PZ that has delivered slimmer margins than the former.
“For clarity, Unilever delivered 6.6 percent and 12.40 percent EBIDTA margins in full-year (FY) respectively vs. PZ ‘s 3.0 percent and 5.20 percent in the same period,” said analysts at Chapel Hill Denham.