Not hard to understand why Femi Otedola is buying tons of Dangote Cement shares. Yes, you can check the following things on a Dangote Cement investment:
- Cement industry market leader with more than 65% of the market share.
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Dividend-paying which has been consistent for years.
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Founder-majority-owned, aligning that dividend-paying culture to the desire to have personal liquidity for other ventures. Aliko Dangote controls about 85% of Dangote Cement.
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Industry-leading gross margin which makes the company a rainmaker on making profits.
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Dominant in regions still at pre-industrialization phase which means more cement will be needed in Nigeria, Ethiopia, etc.
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High barrier of entry which is a great moat that no other person can launch to reshape the competition overnight.
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Etc Etc.
Indeed, provided you are sourcing the funds within Nigeria, why not? But if you are importing funds, the equation changes as you must consider the exchange rate stability. Otedola has truckloads of money within Nigeria to invest.
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Students: there are three types of investors, where would you classify Otedola?
-Growth Maker: you buy low and wait for the value of the company to grow quickly.
-Value Picker: they focus on extremely beaten down equities.
– Income Chaser: these people do not necessarily care if the value of the stocks they hold go up or not, their major focus is the company’s ability to pay dividends.
Let us have an investment class on the Nigerian stock exchange; trade profitably everyone!
Meanwhile, Otedola is back to Forbes top 20 of richest billionaires in Africa
- Aliko Dangote – $13.9 billion
- Johann Rupert & family – $10.1 billion
- Nicky Oppenheimer & family – $9.4 billion
- Nassef Sawiris – $8.7 billion
- Mike Adenuga – $6.9 billion
- Abdulsamad Rabiu – $5.9 billion
- Naguib Sawiris -$3.8 billion
- Mohammed Mansour – $3.2 billion
- Roos Bekker – $2.7 billion
- Patrice Motsepe – $2.7 billion
- Issad Rebrab & family – $2.5 billion
- Mohammed Dewji – $1.8 billion
- Strive Masiyiwa – $1.8 billion
- Aziz Akhannouch & family – $1.7 billion
- Othman Benjelloun & family – $1.4 billion
- Youseff Mansour – $1.3 billion
- Yassen Mansour – $1.2 billion
- Christoffel Wiese – $1.2 billion
- Michiel Le Roux – $1.1 billion
- Femi Otedola – $1.1 billion
Comment on Feed
Comment 1: Femi Otedola’s investment in Dangote Cement seems to be a strategic move, considering the points you’ve highlighted Prof. His decision to invest in a market-leading company with a strong dividend history and a significant barrier to entry could be seen as aligning with the traits of an Income Chaser. However, given the company’s potential for growth in pre-industrial regions and its dominant market share, one could also argue that elements of Growth Investing are at play. Otedola’s unique position allows him to capitalize on local opportunities without the added complexity of currency exchange risks. It’s a nuanced strategy, blending an understanding of local market dynamics with a focus on both value and income.
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