Alerts

   George Ching

March 13, 2024. We have a BUY rating on ACEN with a FV estimate of Php6.45/sh. We continue to like ACEN given the rapid growth of its power generation portfolio and its focus on renewable energy. From ~4,852MW currently, a total of 1,900MW of projects are expected to be completed by 2025. At Php3.90/sh, ACEN is trading at 9.4X FY24E P/E. Upside to our FV estimate of Php6.64/sh is significant at Php70%.

   Charmaine Co

March 12, 2024. Maintain BUY. We currently have a BUY rating on CHIB with a FV estimate of Php42.9/sh, based on 0.65x 2024E P/B. We continue to like CHIB because we expect the bank’s lending business to continue growing alongside the Philippine economy. We also see potential upside on net interest margin should the BSP cut interest rates in the second half of the year. With a growing proportion of consumer loans and the build-up of its securities portfolio, CHIB’s asset yield should be stickier than its cost of funding. Ultimately, we see CHIB as an attractive investment opportunity, factoring in size and liquidity considerations, as it is trading at 0.5x 2024E P/B, with anticipated ROE of 15.4%. In comparison, banks such as BDO and BPI, with similar ROE, are trading at a comparatively higher 1.4x 2024E P/B.

   Paolo Miguel Manansala

March 11, 2024. We currently have a BUY rating on TEL with an FV estimate of Php1,720/sh. At its current price, capital appreciation potential is attractive at 34.6%. Furthermore, we like TEL for its leadership in the fixed line and enterprise segments.

   Richard Lañeda, CFA

March 11, 2024. We maintain our HOLD rating and FV estimate of Php0.92 on FLI given the challenging operating environment of the leasing sector. FLI continues to underperform in the office leasing segment with a higher-than-industry vacancy rate of 62% because of its previous exposure to the POGO segment. But based on the last two quarters, office revenue may have bottomed and maybe back on a growth path as they add more inventory. On a brighter note, residential sales is expected to get some boost later this year as rates are expected to come down in 2H24. Meanwhile, real estate revenue growth has picked up since 3Q23 as collections improved and construction accelerated. We expect this to continue in 2024.

   Charmaine Co

March 08, 2024. We are also revising our FV estimate downwards to Php104.0/sh (based on 0.55x 2024E P/B) from Php123.0/sh (based on 0.65x 2024E P/B) previously. We maintain our BUY rating on the stock as we expect SECB to benefit from the country’s continued economic growth. The bank’s high capital ratios and liquid balance sheet will allow it to pursue opportunities to further grow its intermediation business in the medium term. Furthermore, investments that the bank is currently making in people and technology are expected to come online within the next few years, potentially leading to improved profitability.

   George Ching

March 08, 2024. We have a BUY rating on DMC with a FV estimate of Php15.4/sh. We are maintaining our BUY rating on DMC. DMC is trading at FY24 P/E of 5.9X, below its historical P/E of 11.2X. Based on its actual 2023 cash dividend of Php1.44/sh, this provides a very high dividend yield of 12.5%. Upside to our FV estimate is also very high at 33%.

   Richard Lañeda, CFA

March 07, 2024. We maintain our BUY rating on MEG given its robust residential segment and recovering malls and hotels. Its office segment remains a steady source of income and a strong anchor of the company’s value. Shares of MEG are attractively valued, it trading 56% below our fair value estimate.

   Paolo Miguel Manansala

March 7. 2024. Maintaining HOLD rating. We have a HOLD rating on ICT with an FV estimate of Php221/sh. We are maintaining our HOLD rating on ICT because of the favorable success of its greenfield ports in Australia, Congo and Rio. However, ICT has limited upside amid the share price appreciating by 17.2% YTD.

   Paolo Miguel Manansala

March 06, 2024. We have a HOLD rating on ICT with an FV estimate of Php221/sh. We are maintaining our HOLD rating on ICT because of the favorable success of its greenfield ports in Australia, Congo and Rio. However, ICT has limited upside amid the share price appreciating by 17.2% YTD.

   Richard Lañeda, CFA

March 06, 2024. We have a BUY rating on BLOOM with a FV estimate of Php15.30. We continue to like BLOOM as a bottom-up pick as it is the primary gaming play in the Philippines. BLOOM has a market-leading position in mass gaming, supported by the growth in its premium mass segment and slots. Meanwhile, the VIP segment continues to make a remarkable recovery and it does so without contribution from flown-in players from China. Apart from continued growth in Entertainment City, BLOOM looks to grow its gaming market share (particularly the mass segment) this year with the opening of Solaire Resort North. We note that we have not yet factored in Solaire Resort North into our estimates and fair value.