Some of the Nigerian Exchange's biggest gainers in 2026 share a common trait: their share prices are rising much faster than the health of the underlying businesses. Several have reported years of losses, minimal or no revenue, delayed accounts, or questions about debt and ownership, yet their shares have gained between 50% and over 1,000%. Nairametrics classifies these as “zombie stocks”: listed companies whose operations appear dormant, distressed, or financially weakened, but whose share prices rally. The label does not imply every company is insolvent or incapable of recovery; it describes a sharp disconnect between market price and current operating performance.
How zombie stocks were identified
A rising share price alone does not indicate a zombie stock. Strong companies can rally when earnings improve or the market corrects an undervaluation. For this analysis, Nairametrics compared share-price performance with revenue, profitability, earnings per share, retained earnings, returns on equity and assets, debt obligations, and valuation multiples. Additional factors included delayed accounts, going-concern warnings, prolonged suspensions, free-float deficiencies, and ownership disputes. The clearest candidates display several of these weaknesses while attracting unusually strong demand.
Historical context: Nigeria's 2018 zombie stocks
In February 2018, Nairametrics published a feature on “zombie stocks” whose prices rose despite weak or dying businesses. Unity Bank traded at N0.56 with over N237 billion in negative retained earnings, yet gained about 181%, making it the exchange's best performer at the time. Skye Bank, Japaul, UNIC Insurance, and Union Dicon Salt were also identified. Their rallies were driven largely by expectations of acquisitions, restructuring, or new investors rather than proven earnings improvements. Eight years later, some remained distressed, while others improved and no longer fit the label.
Former zombies that recovered
ABC Transport was named in 2018, but recent numbers suggest it has moved beyond the label. Revenue rose from N6.6 billion in 2021 to nearly N16 billion in 2025, an estimated five-year compound annual growth rate of 24.85%. It returned to solid profitability in 2024 and 2025, and its roughly 90% rally in 2026 appears supported by expanding revenue and improving profitability. Japaul Gold and Ventures has also changed considerably: revenue grew roughly tenfold to almost N4.5 billion in 2025, profit after tax was positive in 2024 and 2025, and total assets increased from N13.1 billion to N33.5 billion. Its 40.3% gain in 2026 is more restrained than the rallies of the most speculative names. Both show why the label must be reviewed as new information emerges.
Fortis Global Insurance: 1,270% gain with weak finances
Fortis has gained about 1,270% year-to-date, but its financial performance remains weak. It has a trailing EPS of negative N0.13 and recorded sustained losses from 2021 through the first quarter of 2026. The rally is complicated by a four-for-one share consolidation and the company's return to trading after a six-year suspension. A consolidation mechanically increases the price per share because ownership is divided among fewer shares; it does not increase economic value. Part of the reported gain may therefore reflect arithmetic rather than investor demand. Even so, Fortis remains loss-making and is working to settle a N5.74 billion obligation linked to an old bond.
DAAR Communications: 273% gain amid losses and dispute
DAAR Communications has gained about 273% in 2026, including a sharp July rally. The company reported losses every year from 2021 to 2025, accumulating an estimated deficit of N6.35 billion. However, it posted a profit of about N335 million in the first quarter of 2026. Its streaming business showed stronger growth, while traditional television and radio recorded limited movement. An unresolved shareholding dispute also remains under regulatory review. DAARCOM is therefore better described as a speculative recovery candidate than a confirmed turnaround. Its next results will indicate whether the early improvement is sustainable.
Morison Industries: 102% gain with going-concern warning
Morison has gained about 101.94% in 2026 despite a trailing EPS of negative N0.03. It lost money in four of the past five years, returned to a small N12.3 million profit in 2025, then slipped back into a loss in the first quarter of 2026. Despite this, Morison trades at about 10.58 times book value and 25.42 times sales. Its 2025 accounts were delayed, and the auditor highlighted material uncertainty over its ability to continue as a going concern, with accumulated losses of about N903.9 million. It also previously breached the NGX free-float requirement before correcting it through a private placement. Together, these issues place Morison firmly within the zombie category.
Critical Minerals Financing Company: 82% gain with zero revenue
CMFC has gained about 82.11% year-to-date, but there is little operating activity behind the rally. The company recorded no revenue between 2021 and 2024 and posted losses every year from 2021 to 2025. Return on equity is negative 19.3%, while return on assets is negative 6.3%. Despite this, the stock trades at about four times book value. Investors are paying for a future business that has not appeared in the financial statements. Until CMFC generates revenue or presents a clearer operating strategy, its rally remains largely speculative.
Omatek Ventures: 76% gain with no revenue
Omatek has gained about 76.11% in 2026 despite an EPS of negative N0.02. Revenue declined from just N3.75 million in 2021 to zero in 2025, while profit after tax has been negative every year since 2021. Its price-to-sales ratio exceeds 28,000 times, although the figure is inflated by extremely low sales. Still, it illustrates the central problem: investors are assigning significant market value to a company generating virtually no revenue. Until Omatek restores meaningful commercial activity and improves disclosure, its rally remains disconnected from its business performance.
Borderline cases and governance issues
Not every weak company with a rising share price fits neatly into the category. FTN Cocoa, another 2018 name, has gained about 70%, but its EPS remains marginally positive. Neimeth Pharmaceuticals and Trans-Nationwide Express have also rallied despite negative earnings. Union Dicon Salt and Tantalizers sit in the grey area; both have attracted turnaround expectations, but available results do not yet show whether their rallies reflect genuine recovery or prices moving ahead of execution. Zombie rallies thrive where information is limited. When companies publish results late, remain suspended for long periods, fall short of free-float requirements, or fail to explain ownership changes and restructuring plans, speculation fills the gap. Better governance does not guarantee profitability, but it helps investors assess risk. Companies undergoing genuine turnarounds should publish timely accounts, explain new revenue sources, disclose major ownership changes, and show how fresh capital will be used. Regulators also need greater transparency around suspensions, unusual price movements, and delayed filings.
Conclusion: Price versus performance
The phenomenon cuts across insurance, media, industrials, mining finance, and technology. What connects the companies is the gap between price and operating performance. The lesson from 2018 is not that every zombie will collapse. ABC Transport and Japaul show that some companies can rebuild revenue, return to profitability, and justify renewed investor interest. But a turnaround must become visible through revenue growth, stronger cash flow, lower debt, timely accounts, and sustainable profits. A rising share price is not proof of a recovering business. Sometimes the market has identified a turnaround early. At other times, it is simply watching a zombie learn to walk.
