The six listed agricultural companies on the Nigerian Exchange (NGX) have closed the first half of 2026 with a combined profit after tax of N123.48 billion, reinforcing the sector’s strong performance despite wide differences in valuation and underlying fundamentals.
The companies — Zichis, Ellah Lakes, FTN Cocoa, Livestock, Okomu Oil and Presco — generated the combined profit in the first six months of the year, representing 70.75 per cent of their total N174.51 billion profit for the full year 2025.
Their combined revenue also rose strongly, reaching N688.88 billion in H1 2026. This was about 20 per cent higher than the N574.09 billion recorded by the companies for the whole of 2025.
The strong earnings performance has been reflected in their share prices. As of the close of trading on Monday, August 10, 2026, the six companies had added approximately N1.03 trillion to their combined market capitalisation, bringing the total to N3.884 trillion.
Their combined market capitalisation represented 2.42 per cent of the NGX’s broad market capitalisation of N160.42 trillion, while the stocks recorded an average year-to-date gain of about 377 per cent.
However, the earnings performance also highlights significant differences among the stocks, with some backed by strong earnings growth, others carrying stretched valuations or weak balance sheets, and one showing early signs of a potential turnaround.
Presco appears to offer the strongest combination of growth and valuation for long-term investors.
The company’s shares have risen 41.74 per cent year-to-date, significantly below the gains recorded by some of its peers. This comparatively modest increase suggests that its share price has not moved as far ahead of its underlying fundamentals.
Presco’s earnings have grown by an average of about 58 per cent annually over the past five years, while dividends have grown at approximately 114 per cent annually.
The company trades at about 20 times earnings. Against its historical earnings growth, this translates to an indicative price-to-earnings growth (PEG) ratio of about 0.34, suggesting that its valuation remains relatively moderate compared with its growth rate.
Presco also has the lowest price-to-book ratio among the sector’s profitable companies at about 4.76 times, compared with the sector average of 16.15 times. Its price-to-sales ratio of about six times is also among the lowest among profitable peers.
The company’s balance sheet further strengthens its investment case, with close to two-thirds of its assets funded by equity.
The combination of strong earnings growth, dividend expansion and a relatively reasonable valuation makes Presco more suited to long-term investors than short-term momentum traders.
Okomu Oil also stands out as a strong fundamental growth story, although its valuation suggests that investors are already paying a premium for that performance.
The company has grown its profit by about 50 per cent annually over the past five years, while revenue has increased by approximately 52 per cent annually.
Its return on equity of nearly 65 per cent is the highest among the six agricultural companies, while its relatively low leverage indicates that the strong returns are largely being generated by the underlying business rather than heavy borrowing.
However, Okomu trades at about 26.97 times earnings and 18.22 times book value. Its price-to-book ratio is therefore above the sector average of 16.15 times and nearly four times Presco’s multiple.
Its enterprise value-to-EBITDA ratio of 14.60 times also places it at a premium to Presco.
Okomu’s 29.50 per cent year-to-date gain is the lowest among the six companies, despite its strong fundamentals. This could indicate that much of its quality had already been priced into the stock before the latest sector-wide rally.
With the shares also trading close to their 52-week high, Okomu remains an attractive long-term growth company, but investors may be better served waiting for a pullback before entering at a more favourable valuation.
Zichis, FTN Cocoa and Livestock present more challenging investment cases despite their different share-price performances.
Zichis has delivered the strongest share-price performance, surging 1,016 per cent year-to-date. However, the company only listed on the NGX in January 2026, leaving investors with a limited public-market track record.
The stock currently trades at about 36 times earnings, nearly three times the sector average of 12.89 times. Its valuation therefore places a significant premium on future growth that has yet to be tested over a longer period.
FTN Cocoa carries a different set of risks. Its price-to-book ratio of 40.31 times is the highest among the six companies, despite declining earnings and a very thin equity base.
Shareholders’ equity accounts for only about 3.3 per cent of its total assets, indicating that the company’s balance sheet is funded predominantly by liabilities.
Livestock also faces balance-sheet and profitability concerns. Equity represents only about 10 per cent of its assets, while the company has recorded losses in three of the past five years and currently has a negative return on equity.
Neither FTN Cocoa nor Livestock has a dividend track record strong enough to provide an additional cushion for investors.
Ellah Lakes presents a different proposition as a potential turnaround story.
The company is the only one among the six to record a negative year-to-date share-price performance, falling 35.07 per cent against an average sector gain of about 191 per cent.
However, some of its underlying financial indicators have begun to improve.
Although Ellah Lakes remains loss-making, its losses have narrowed steadily, with loss per share improving from approximately N0.71 in 2024 to N0.28 in H1 2026.
Its balance sheet is also relatively strong, with about 98 per cent of its assets funded by shareholders’ equity rather than debt.
The stock’s price-to-book ratio of 2.15 times is the lowest among the six companies and significantly below the sector average of 16.15 times.
However, the low valuation alone does not establish that the stock is undervalued because the company has yet to achieve sustainable profitability.
The expected turnaround has also not fully translated into revenue and earnings growth.
For long-term investors, Ellah Lakes therefore remains a stock to watch pending clearer evidence of sustained profitability. For short-term traders, the lack of positive price momentum makes the stock less attractive.
The performance of the six agricultural stocks highlights the importance of looking beyond headline market gains when assessing investment opportunities.
For long-term investors, Presco appears to offer the clearest combination of quality growth and a valuation that has not moved excessively ahead of its fundamentals.
Okomu Oil remains a strong growth stock but may offer a better entry point after a pullback.
Zichis could appeal to short-term momentum traders because of its substantial price movement and volatility, although its elevated valuation means the trade carries significant risk.
Ellah Lakes is better viewed as a turnaround stock to monitor rather than an immediate buy, while FTN Cocoa and Livestock face significant fundamental challenges that weaken their long-term investment cases.
The H1 2026 results therefore show that strong sector-wide earnings and share-price growth do not necessarily translate into equally attractive investment opportunities.
As the sector enters the second half of the year, the key consideration for investors will be whether earnings growth can continue to support valuations — and whether companies yet to demonstrate sustainable profitability can turn improving indicators into stronger financial performance.
