First HoldCo Q3: Profit Up 65%, But Is ₦124 Too High?
Earnings Flash Report : https://tr.ee/za6qndZLCl
Ticker: NGX: FIRSTHOLDCO
Verdict: AVOID at ₦124.00 (30 October 2026)
Fair value range: ₦77 to ₦104 (12-month target ₦103.30)
The one-liner: Profit is booming, but recoveries and trading gains are doing the lifting while the lending engine shrinks. Not financial advice. Full disclaimer below.
First HoldCo dropped its Q3 2026 results last week and the headline looks great. Profit after tax for the nine months to September rose 65.1% to ₦744.5bn, profit before tax hit ₦911.2bn, and EPS climbed to ₦16.45 from ₦10.65.
The stock has already had a huge run. It’s up roughly 290% over the past year and trades at ₦124.00, about 1.49 times book value. First HoldCo clearly made money this year, so the useful question is whether today’s price still makes sense once you see where that money came from.
Where the profit came from
Strip the results back and the core banking line went the wrong way. Net interest income (what the bank earns on loans and securities minus what it pays depositors) fell 16.0% to ₦1.26tn. In Q3 alone it dropped 36.0% year on year to ₦381.0bn.
The growth came from everywhere else. Non-interest income more than doubled to ₦722.9bn, helped by two items you shouldn’t expect to repeat on schedule and one that looks more durable:
- a ₦104.6bn gain on trading securities, after a ₦72.8bn loss in the same period of 2025
- ₦94.3bn of recoveries on old bad loans, up from ₦5.9bn a year earlier
- net fees up 48.1% to ₦316.4bn, which is the healthiest part of the mix
Costs helped too. Operating expenses fell 8.1% to ₦866.6bn and impairment charges dropped 28.3% to ₦207.1bn, pushing cost to income down to 43.7% from 52.4%. If you take out the recoveries at the same tax rate, PAT lands near ₦667bn. That’s still about 48% higher than last year, so the business is improving, just less dramatically than the headline suggests.
| 9M 2026 (₦bn) | 9M 2026 | 9M 2025 | Change |
|---|---|---|---|
| Net interest income | 1,260.1 | 1,500.6 | -16.0% |
| Non-interest income | 722.9 | 296.9 | +143.5% |
| Operating expenses | 866.6 | 942.7 | -8.1% |
| Profit after tax | 744.5 | 450.9 | +65.1% |
| EPS (₦) | 16.45 | 10.65 | +54.5% |
Source: First HoldCo Plc unaudited consolidated financial statements, period ended 30 September 2026.
What is First HoldCo worth?
Banks are valued on book value and returns, because their debt is raw material for the business. So the test is how far above its cost of equity (the return shareholders need to justify the risk) First HoldCo can keep earning.
We set the cost of equity at 22.55%, built from the 17.05% 10-year FGN bond yield plus a 5.5% equity risk premium. The annualised ROE in these results is 27.7%, but that includes the one-offs above, so we normalise it to 23%. A bank earning only half a point above its cost of equity deserves to trade close to book.
| Method | Weight | Value per share |
|---|---|---|
| Residual income model | 60% | ₦89.87 |
| Justified P/BV (1.04x × ₦83.44 book) | 40% | ₦86.69 |
| Blended fair value today | ₦88.60 | |
| 12-month target price | ₦103.30 |
At ₦124.00 the market is pricing in roughly a 28% ROE for the long run. That’s possible, but these results don’t show it yet without recoveries and trading gains doing part of the work. The full workings, including a sensitivity table, are in the PaprSwing earnings flash.
What to watch, and the bottom line
Three things would change our view, ranked by how much they’d move the number:
- Bond yields falling. If FGN yields drop toward 13%, fair value rises to about ₦142 on its own.
- ROE holding above 28% without one-offs. That alone lifts fair value to about ₦134.
- Q4 net interest income stabilising. Another 30%-plus drop would push our numbers lower.
The bottom line is that First HoldCo is a much stronger bank than it was two years ago, and the market has already paid you for that. At ₦124.00 we’d treat it as a walk-away zone. Below ₦90 it starts to look like fair value, and under ₦75 it becomes interesting. If you already hold it, Q4 results are the checkpoint.
Want to see every number behind this? Drop a ticker in the comments and it joins the queue for the next earnings flash.
PaprSwing runs on numbers, not vibes. Do your own diligence, because this is research and not a directive.
Disclaimer: This post is for education only and isn’t investment advice or a recommendation to buy or sell any security. Figures come from First HoldCo’s unaudited filings and may be revised. The share price is an intraday TradingView quote from 30 October 2026 and will move.
Sources
- First HoldCo Plc unaudited consolidated financial statements, period ended 30 September 2026
- Nairametrics: Nigeria’s 10-year bond yield rises (21 October 2026)
- TradingView, NSENG:FIRSTHOLDCO quote, 30 October 2026