Alerts

   George Ching

March 04, 2025. We have a BUY rating on SCC with a FV estimate of Php53.3/sh. SCC is trading at 7.2X FY25 P/E, below its 10 year historical P/E of 11.6X. Based on its actual2024 cash dividend of Php6/sh, this provides a very high dividend yield of 16.1%. Upside to our FV estimate is also very high at 46%.

   George Ching

March 04, 2025. Maintaining BUY rating.In light of the sale of NIKL’s stake in CBNC and the reduction in our LME selling price estimate, we are reducing our FY25E earnings forecast by 21% to Php4.5Bil. We are also lowering our FV estimate on NIKL by 13.9% to Php4.46/sh. Despite NIKL’s disappointing earnings performance mainly due to losses from its investment in HPAL, we remain positive on the long-term outlook for nickel due to the rising EV battery demand. In addition, we believe that NIKL’s expansion of its RE power generation business comes at an opportune time given the strong cash flow generation of its nickel mining business, as well as the tightening of power supply in the country. At its current price of Php2.39/sh, upside to our FV estimate is at 87%.

   Paolo Miguel Manansala

March 03, 2025. Maintaining BUY rating on TEL. We are reiterating our BUY rating on TEL with an FV estimate of Php1770/sh. We continue to like TEL for its leadership in the broadband and enterprise industry. We also like TEL for its continued development of new products and services, along with the expansion of its capacity. TEL currently has the highest dividend yield among its peers, ~7.2% at current prices. Capital appreciation is also significant at 31.2% based on yesterday’s closing price.

   Denise Joaquin

March 03, 2025. Cutting FV estimate to Php8.10/sh; maintain BUY We are lowering our FV estimate on DNL to Php8.1/sh from Php9.0/sh previously as we reign in our expectations on gross profit and earnings recovery this year. In particular, we reduced our net income projections to Php2.9Bil (-17.9%) in FY25 and to Php3.4Bil (-17.6%) in FY26, driven mainly driven by our lower GPM assumptions amid continued input cost volatility. Additionally, we increased our operating and finance cost projections. Despite the cut in our estimates, we maintain our BUY rating on the stock. We find DNL’s long-term growth prospects attractive owing to the significant capacity expansion from its Batangas facility, which is poised to scale its export business over the coming years. We also like the stock given the improving outlook for Chemrez in light of the energy department’s renewed push to hike the minimum biodiesel blend requirement.

   Richard Lañeda, CFA

March 03, 2025. Reduce FV estimate to Php1,000 We are reducing our fair value estimate from Php1,065 to Php1,000 after factoring in the lower fair value estimate for SMPH. While we remain cautious on the residential segment of SMPH, we believe current prices already factor in a significant downside risk. In addition, SMPH’s mall business is robust and growing, lending support to the current residential business. SM also has exposure to the banking sector through BDO and CBC which continue to perform quite well and operates in a more friendly operating environment. Overall we see value in SM at its current price. The recently announced share buyback should also support the price from further downside risk.

   Charmaine Co

February 26, 2025. Maintain BUY. We currently have a BUY rating on BDO with an FV estimate of Php181.0/sh, based on 1.50x 2025E P/B. We continue to favor the bank as we believe that BDO, as the largest bank in the Philippines, is well-positioned to capture growth opportunity as the local economy expands. Its extensive and still growing branch network, as well as its strong ties to the SM Group should provide a significant advantage. BDO’s robust and liquid balance sheet, coupled with healthy capital ratios, also gives the bank the flexibility to pursue new avenues of growth. While challenges to NIM may arise from BSP rate cuts, we expect this to be mitigated by changes in the bank’s asset mix and the positive impact of the RRR reduction. Additionally, we see potential earnings upside from lower provisioning requirements and the booking of trading gains.

   Charmaine Co

February 26, 2025. Maintain BUY. We maintain our BUY rating on MBT with an FV estimate of Php92.60/sh, based on 1.0x 2025E P/B. We remain optimistic about MBT as it is wellpositioned to benefit from the country’s economic growth. Compared to peers BDO and BPI, MBT has a more liquid balance sheet (LDR of 71% vs BDO’s 86% and BPI’s 87%), giving it added flexibility to pursue growth opportunities. Moreover, MBT is well-capitalized, with one of the highest CET1 ratios among banks. This strong capital foundation enables the bank to steadily grow its loan portfolio and to maintain dividend distributions. Note that MBT offers one of the highest dividend yields across the sector at ~7%. Finally, MBT is relatively undervalued compared to its peers as it trades at 0.8x P/B, well below BDO’s 1.2x and BPI’s 1.4x, even considering ROE differences.

   Denise Joaquin

February 20, 2025. Reiterate BUY..We reiterate our BUY rating on MONDE with FV estimate of Php13.30/sh. We expect steady topline growth and continued GPM gains to drive growth in its core branded business in FY25. Additionally, we believe that sentiment on the stock has largely turned around as concerns over further impairment losses for MAB and dividend payment risks may be addressed by MONDE’s 10-year risk reduction plan, which will provide retained earnings protection for the listco at the equity level.

   Richard Lañeda, CFA

February 18, 2025. New FV estimate still implies big upside. We maintain our BUY rating on SMPH as our more conservative fair value estimate still has a 66.74% from the current price of SMPH. Note that SMPH is still the largest mall operator in the Philippines despite facing challenges in the residential segment. SMPH’s malls have been very resilient in the face of higher interest rates and high inflation. Malls still account for the bulk of SMPH’s revenues (57%) and income (68%).

   Charmaine Co

February 05, 2025. Maintain BUY. We currently have a BUY rating on BPI with an FV estimate of Php144.0/sh, based on 1.55x 2025E P/B. Our positive outlook on BPI is primarily driven by its industryleading ROE and strong long-term growth potential. With the BSP shifting towards an expansion monetary policy, we expect continued portfolio growth, fueled by the bank’s agency banking push and aggressive customer acquisition strategies. Additionally, its strong ties to the Ayala and Gokongwei groups should further support business expansion. While NIM may face some pressure this year, we believe the reduction in RRR and the adjustments in the bank’s balance sheet dynamics, will help mitigate the impact of lower rates.