Meyer Plc and Berger Paints Plc, each listed on the NGX beneath the Industrial sector and Constructing Supplies sub-sector, have seen their shares rally strongly this 12 months
They function alongside main industrial friends like BUA Cement, Dangote Cement, and Lafarge (WAPCO) within the sector/subsector
However for the paint producers, as of August 2025, Meyer Plc led the pack with a 98.7% year-to-date (YtD) acquire, whereas Berger Paints posted additionally a powerful 84.5% YtD improve.
Each have considerably outperformed the Industrial Index (39.27% YtD) and the All-Share Index (36.31% YtD).
Taking a look at their latest historical past additionally, Meyer Plc led in 2024 with a outstanding 158% YtD acquire, whereas Berger Paints recorded a stable 54% improve.
Nonetheless, whereas the spectacular share value rallies recommend a bullish market sentiment, a rising value alone doesn’t inform the complete story.
Buyers ought to weigh the elements driving the rally, the sustainability of the expansion, and the way the market is valuing these corporations.
From this angle, we are going to assess how each corporations have carried out financially, decide if the rallies are supported by sturdy fundamentals, and determine which one at the moment presents higher worth.
Steadiness Sheet
Once you put the 2 paint makers facet by facet, Berger comes throughout as the larger participant. Its stability sheet stands at about N7.6 billion, greater than twice the dimensions of Meyer’s N2.99 billion.
However dimension isn’t all the things. Each corporations have stored debt low, which implies they don’t spend a lot on curiosity funds.
That’s a plus for traders as a result of it lowers monetary danger and leaves room to borrow later in the event that they wish to develop.
Taking a look at how they’re financed, Meyer is the extra cautious one: about 65% of its property are funded by shareholders’ fairness.
Berger, alternatively, leans a bit extra on debt, with fairness overlaying round 55% of its property.
This means that Meyer is safer however slower, relying totally on its personal cash. Berger takes on a little bit extra danger, however that might imply larger rewards if enterprise circumstances flip beneficial.
Income and Profitability
Berger Paints and Meyer are each doing nicely however in several methods.
- Berger is the larger participant, pulling in N6.2 billion in income within the first half of 2025 and making N625 million revenue. That offers it a ten% revenue margin, that means for each N1 it earns, solely 10 kobo is stored as revenue.
- Meyer, although smaller with N2 billion income and N257 million revenue, has a 12.7% margin.
In plain phrases, Berger sells extra paint and makes extra money general, however Meyer is extra environment friendly at preserving income from each Naira earned.
Taking a look at asset use, Berger is stronger, it generates nearly N2 in income for each N1 of property (1.92x), in comparison with Meyer’s 1.1x. This reveals Berger will get extra out of what it owns.
Now allow us to take a look at what the market is saying in regards to the corporations.
Valuation
Berger Paints seems to be like a heavyweight. Its market capitalization stands at about N11 billion, comfortably above its complete property of N7.6 billion and web property of N4.2 billion. This reveals that traders already worth Berger at a premium to its guide worth.
Meyer, alternatively, trades at a good steeper premium. With a market cap of N8.9 billion towards complete property of N2.99 billion and web property of N1.94 billion, traders are clearly paying up for Meyer relative to its dimension.
Now, let’s dig into income. Berger is buying and selling at a price-to-sales ratio of 0.92. This implies traders are paying simply 92 kobo for each N1 in income Berger generates. That’s a discount in comparison with Meyer’s price-to-sales ratio of two.28 the place traders are paying N2.28 for each N1 of income.
Merely put, Berger seems to be cheaper, whereas Meyer seems costly.
Earnings inform the identical story.
- Buyers are paying about N9.55 for each N1 of Berger’s earnings.
- For Meyer, traders are paying nearly N20 for each N1 of Meyer’s earnings greater than double Berger’s valuation.
If income stay fixed, it is going to take traders about 10 years to recoup their funding in Berger Paints and 20 years in Meyer.
However traders don’t simply pay for at present’s earnings. They’re betting that income will develop sooner or later, which might shorten the payback interval.
The massive query, nevertheless, is whether or not they can obtain the anticipated progress.
Over the previous 5 years, Berger Paints has compounded its revenue at 33% yearly, whereas Meyer’s revenue declined by 23%.
Nonetheless, the tide has turned in 2025. Within the first half of the 12 months, Meyer grew revenue by 104% year-on-year, whereas Berger’s revenue surged by over 600%.
General, the numbers inform completely different tales. Berger presents scale and relative undervaluation, whereas Meyer stands out for effectivity and progress.
Which one an investor prefers will depend on whether or not they’re chasing worth (Berger) or margin energy and potential progress (Meyer).
Importantly, each corporations keep low debt profiles particularly Meyer, with an nearly zero debt-to-equity ratio.
This can provide them headroom so as to add leverage, which may improve their present low returns on fairness as they develop
Buyers would probably hope Meyer can return to its 2020 peak, when revenue hit the N1 billion mark.
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