Dennise Williams, Staff Reporter 
Mark Golding
THE FUNNY thing about bear markets is that companies doing well just can't seem to get a break.
No matter how positive the earnings are, investors seem to shrug off the news. Case in point is the stagnant share price of investment bankers Dehring Bunting and Golding.
The share price has remained under $22 for months, despite assertions by several analysts that the stock is undervalued.
One analyst recently publicly questioned why investors hadn't latched on to the 'money train'. He named DB&G and another ubiquitous merchant bank as two stocks that he expects the share price to grow by at least 50 per cent based on the earnings.
DB&G's third quarter results for the nine months period ending December 2005, released almost two weeks ago, revealed an 18.7 per cent increase in net profits compared to the corresponding period in 2004.
Essentially, after the company paid the taxman, they had $546.6 million left over. Net interest income was $588.1 million, a whopping increase of 41.3 per cent.
MODEST INCREASE
Other operating income increased by a modest two per cent to $627.2 million.
Now, operating expenses did increase by 18.1 per cent for the period, but that is to be expected as the company recently opened a branch in oil rich Trinidad & Tobago and inflation has not been helpful.
And so at the end of the period, earnings per share were booked at $1.80 in December 2005 compared to $1.59 in December 2004.
The Financial Gleaner spoke to company director Mark Golding on Wednesday about the share price stagnation.
"Our stock is very liquid and widely held," he said. "The volume of shares traded daily attests to this. Also, the largest shareholder in DB&G doesn't hold 20 per cent of the company.
"So this makes us one of the most traded stocks on the Jamaica Stock Exchange. And that is a good thing because when investors want to sell our shares, there are always buyers.
"But on the other hand, the fact that there isn't a limited supply doesn't drive up the price."
Mr. Golding agrees with analysts who see DB&G as a stock with upward pricing potential as he says, "DB&G has consistently demonstrated sustainable earnings and the ability to grow in the marketplace."
And he dismisses claims by detractors that his company has received special favours because of good friends in high places.
BENEFICIAL TRANSACTIONS
"Nothing has been handed to us. We have proactively come up with transactions that benefit both parties involved. Now, because of the size of several of our projects implemented, the other party is the Government," he said.
"Let me be clear that we have either conceptualised our deals or done a competitive bid," he stated. "When we bid for Eagle Unit Trust (now DB&G Unit Trust Managers Limited) we were the highest bidders. No one else saw the value."
And finally, Mr. Golding does admit that the general malaise in trading on the JSE contributes to slowing the share price growth.
TAKEN FROM THE FINANCIAL GLEANER, FRIDAY, JANUARY 27, 2006
