Analyst urges Conoil to raise 2026 dividend

LAGOS, Nigeria — Conoil Plc shareholders have had a difficult run, and an analysis argues the company should pay a bigger dividend for its 2026 financial year as earnings recover.

According to the analysis, an investment of ₦100,000 in Conoil at the end of 2024 was worth about ₦54,240 by the end of October 2026, before dividends and trading costs. The stock rose 361.5% in 2024, climbing from ₦83.90 to ₦387.20 per share. It then fell 51.7% in 2025 to ₦187.20, and rose 12.2% in 2026 to ₦210.00 by the end of October. It was still trading at that price at the close on November 11, 2026.

The analysis says the 2026 rebound recovered only 11.4% of the ₦200 per share lost in 2025, and that Conoil has lagged the Nigerian Exchange Oil and Gas Index, which rose 127.90% over the same ten months.

Conoil has paid a dividend in each of the five financial years from 2021 to 2025. It cut the payout from ₦3.50 per share for 2024 to ₦2.00 for 2025. At ₦210, the last dividend gives a gross yield of 0.95%.

Earnings have recovered strongly. Conoil earned ₦7.65 per share in the first nine months of 2026, more than double its full-year 2025 earnings. If the fourth quarter matches the third quarter’s ₦0.22 per share, full-year earnings would reach about ₦7.87. A ₦3.50 dividend would absorb about 44.5% of that figure, a smaller share than the company paid out with its ₦2.00 dividend for 2025.

The analysis notes that third-quarter revenue rose to ₦100.23 billion, but pre-tax profit fell 73.4% to ₦206.51 million. It says the earnings projection assumes Conoil repeats a quarter in which profits were already under pressure.

Restoring the ₦3.50 dividend would cost about ₦2.43 billion, roughly ₦1 billion more than paying ₦2.00 again. The analysis points to cash flow as the main constraint. Net cash from day-to-day operations was about ₦275 million in the first nine months, while borrowings rose and cash held fell. Trade and other receivables increased by ₦23.35 billion over the same period.

The analysis argues that collecting overdue customer payments and tightening payment terms on new sales would be the clearest way to fund a larger payout without borrowing. It says the shares trade at about 27 times expected 2026 earnings and 3.27 times book value, so buyers are already paying for a recovery. Restoring the ₦3.50 dividend would lift the yield at ₦210 to about 1.67%.

The analyst’s recommendation is that Conoil prioritise faster collections and restore the ₦3.50 dividend if it can fund the payout after meeting its own obligations.