Norrenberger Equity model delivers 82% return in 2025, beats market for second consecutive year

By Abubakar Yunusa

Norrenberger’s Equity Portfolio Model (EPM) once again outperformed the Nigerian equity market in 2025, delivering a robust 82% return and beating key market benchmarks for the second year in a row. Designed to consistently generate superior risk-adjusted returns, the EPM significantly exceeded the performance of the broader market.

The EPM’s 82% return represents a 30-percentage-point and 33-percentage-point outperformance over the NGX All-Share Index (52%) and the NGX 30 Index (50%), respectively. This decisive margin underscores the strength of Norrenberger’s investment strategy, disciplined portfolio construction, and stock-selection expertise.

This performance builds on the model’s strong track record in 2024, when the EPM returned 48.1%, outperforming the NGX All-Share Index’s 38% gain. The back-to-back outperformance highlights the model’s consistency and reinforces its effectiveness across varying market conditions.

The chart below shows the performance of the EPM against both the ASI and the NGX 30.

The portfolio’s success in 2025 was driven by a carefully curated mix of ten high-quality stocks spanning key sectors of the Nigerian economy, including telecommunications, consumer goods, banking, energy, and insurance.

Sector selection was informed by Norrenberger’s macroeconomic outlook for 2025, particularly expectations around earnings recovery following FX-induced losses in consumer goods and telecommunications companies after the naira devaluation.

Stock selection combined strong earnings fundamentals with technical analysis, enabling the portfolio to capture both cyclical recovery opportunities and structural growth themes, while maintaining a disciplined approach to risk management.

Security Security Weight (%) 31-Dec-25
DANGSUGAR 11.0% 85%
MTNN 15.0% 156%
MANSARD 8.0% 67%
ZENITHBANK 11.0% 36%
BUACEMENT 11.0% 92%
ARADEL 10.0% 12%
STANBIC 9.0% 74%
TRANSPOWER 10.0% -15%
NASCON 8.0% 243%
JAIZBANK 7.0% 52%
EPM 81%
ASI 51%
NGX30 49%

MTN Nigeria (MTNN), the portfolio’s largest holding, was the primary driver of performance, with its strong rebound translating into an impressive 156% annual return and allowing the portfolio to fully capture the upside.
Additional support came from Dangote Sugar and BUA Cement, which benefited from pricing power and improving operating leverage, reinforcing exposure to real-sector growth.

Within the banking sector, Zenith Bank and Stanbic IBTC delivered steady gains of 36% and 74%, respectively, underpinned by resilient earnings and strong market positioning. These holdings provided stability during periods of volatility while participating in the broader market rally.

Mid-sized and smaller positions enhanced diversification and returns. Aradel Holdings posted a modest 12% gain, offering measured exposure to oil and gas, while Transcorp Power declined 15%, reflecting a subdued performance but serving a diversification role. Among smaller holdings, AXA Mansard (67%), Jaiz Bank (52%), and especially NASCON (243%) delivered notable upside, supported by sector-specific tailwinds, improved fundamentals, and positive market sentiment.

The EPM’s performance reflects a well-balanced portfolio that successfully combined high-growth opportunities with defensive and income-generating positions.

What to expect in 2026

For 2026, the Norrenberger Equity Portfolio Model has been restructured into four distinct portfolios, designed to offer clients a broader range of choices aligned with varying risk appetites and investment objectives.

A key addition is the soon-to-be-launched Sustainability Index, which tracks companies on the NGX with the strongest environmental, social, and governance (ESG) credentials.
In addition, we have curated dedicated portfolios focused on dividend-paying stocks, defensive equities, and growth stocks, providing investors with diversified pathways to participate in the equity market while optimizing risk-adjusted returns in 2026.

Outlook for 2026

Following several years of robust market performance, equity returns in 2026 are expected to be more selective and earnings-driven rather than broad-based. Companies with strong balance sheets, pricing power, and exposure to long-term structural growth themes are likely to outperform.

In this environment, valuation discipline and rigorous fundamental analysis will be critical to generating alpha. Building on the strong performance and proven methodology of the Norrenberger’s EPM, which delivered a +820% return in 2025, outperforming the NGX All-Share Index (+521%), we remain constructive on equities as a long-term wealth creation asset class.

This outlook is particularly compelling for investors willing to navigate short-term volatility in pursuit of superior real returns over the medium to long term.