I finally took some profits a couple of days ago from one of my favorite picks, DMC. The company was trading at all time highs and it has for the most part received a lot of selling pressure at the 48 level. I sold more than half between 47-48 and have left behind a small position. Today its trading at the 44-45 level and I expect it to go a tad bit lower before I would find this stock attractive again. Don't take it as my advice to stay away from the stock, I love the company and think its got some room to grow for 2011, 2012, and 2013; but numbers tell me that the company is already being overbought and it would be prudent to take profit then see your profits slowly melt away.
Lately, I've been asked by a number of friends whether or not LR and AGI is worth looking into. Truth is, I've never really bothered. I pay close attention to its prices and its numbers, but I've never really considered in depth research. This is what I've been hearing; both companies are worth at least 15 pesos a share and that AGI has recently broken through resistance, while LR has finally met some. Either way; the price movement of both these companies have been for the most part phenomenal in the past few months. And if past number are any indication to its potential, they've got some way to go.
SCC, has recently declared a 10 peso per share cash dividend due to be credited on June 22, 2011. On top of that, most foreign and local brokers have re-rated it upwards. Prices may have fallen recently, but I personally think that was a great opportunity to buy. If any of you are interested in a vertically integrated company with plays on resources and consumer needs; then SCC is definitely worth looking into. Don't let its past numbers scare you, do your research; you will find that the company at today's price is relatively cheap.
Wednesday, April 27, 2011
Wednesday, April 13, 2011
Guidance
Very often market movement is shaped by general sentiment of investors; locally, that sentiment seems to be guided by foreign buying or selling. The past few days, I've seen two of my favorite stocks move in almost opposite directions, due to foreign guidance.
SCC has been moving down due to the recent sell-off by foreign funds led by Deustche. SCC's re-rating from 215-205 seems to have affected foreign perception of the stock. Locally though, funds have been re-rating the company upwards. With citiseconline giving SCC a FV of 295, consensus seems to hit beyond the 250 peso mark and that can only be good news for most investors. ATR is also said to be initiating coverage of the company soon. Investors should be mindful that based on 2010 PE ratio of 20+ the stock may seem overly priced, but from the 2011 and 2012 perspective; the company has quite a bit more room to move up. My fearless forecast is that it would shatter the 250 peso mark in the next 3-6 months and continue to move up.
DMC, on the other hand, has been steadily moving up. It broke through its all time high of 41 pesos a couple of days ago and it has continued to move up and is testing the 43 peso mark. Some people may argue that this stock is expensive, but comparing it to sectoral peers such as MPI, SMPH, AC this stock has quite a bit of an upside. Consider the business the company is in; power, mining, construction (with 48 billion pesos worth of backlog), water, and you recognize a very good business model that stretches around the whole economic growth story our country is going through. Understanding that the value, whether peaks or bottoms, are meant to be broken is part of realizing that you are not merely owning a piece of paper, but a part of the company.
Off topic, SMC has suspended share trading up until the first week of May to avoid "speculation"; I guess a lot of movement may happen if the stock was traded today. We have the SC ruling in favor of Cojuangco on his years-long battle with the government for control of a substantial amount of shares. And we also have the share rights offering that is rumored to priced at 150 pesos per share. Interesting to see where the company intends to use the proceeds, I'm guessing expansion of power assets, thats what i would do.
With holy week just around the corner, I expect trading to slow down, but who knows, there might be good companies on the cheap after the two-day slide the PSE experienced. Might be a good time to pick up some strong companies that have largely been ignored or have been sold down; EDC, SCC, CEB, UBP, URC, just to name a few
SCC has been moving down due to the recent sell-off by foreign funds led by Deustche. SCC's re-rating from 215-205 seems to have affected foreign perception of the stock. Locally though, funds have been re-rating the company upwards. With citiseconline giving SCC a FV of 295, consensus seems to hit beyond the 250 peso mark and that can only be good news for most investors. ATR is also said to be initiating coverage of the company soon. Investors should be mindful that based on 2010 PE ratio of 20+ the stock may seem overly priced, but from the 2011 and 2012 perspective; the company has quite a bit more room to move up. My fearless forecast is that it would shatter the 250 peso mark in the next 3-6 months and continue to move up.
DMC, on the other hand, has been steadily moving up. It broke through its all time high of 41 pesos a couple of days ago and it has continued to move up and is testing the 43 peso mark. Some people may argue that this stock is expensive, but comparing it to sectoral peers such as MPI, SMPH, AC this stock has quite a bit of an upside. Consider the business the company is in; power, mining, construction (with 48 billion pesos worth of backlog), water, and you recognize a very good business model that stretches around the whole economic growth story our country is going through. Understanding that the value, whether peaks or bottoms, are meant to be broken is part of realizing that you are not merely owning a piece of paper, but a part of the company.
Off topic, SMC has suspended share trading up until the first week of May to avoid "speculation"; I guess a lot of movement may happen if the stock was traded today. We have the SC ruling in favor of Cojuangco on his years-long battle with the government for control of a substantial amount of shares. And we also have the share rights offering that is rumored to priced at 150 pesos per share. Interesting to see where the company intends to use the proceeds, I'm guessing expansion of power assets, thats what i would do.
With holy week just around the corner, I expect trading to slow down, but who knows, there might be good companies on the cheap after the two-day slide the PSE experienced. Might be a good time to pick up some strong companies that have largely been ignored or have been sold down; EDC, SCC, CEB, UBP, URC, just to name a few
Sunday, April 10, 2011
Bullishness
Week on week our market has been pushing boundaries and with foreigners buying more than they are selling our market is in a pretty good spot at this point. Strong buying can be seen in some of my favorite stocks such as EDC, DMC, MBT, AP, and a recent addition ICT. I wouldn't mind adding to my positions in EDC, MBT, and AP; but I would probably shy away from adding more to DMC until I see what their first quarter results are like. I've also started to take a keen interest in the banks simply cause of the recent interest rate increase and speculation that more are to follow. A number of banks that I can't seem to get enough of are MBT(being a sectoral leader), UBP(good, steady growth, 2.5 pesos per share dividends), and SECB(numbers are just all green).
I've taken an interest in ICTSI, because of its global story. The company has acquired numerous ports in different countries; ranging from Brazil to China to the USA to Madagascar (you get the picture). And it continues to do so! A good friend of mine tells me that its books are in order and their numbers have a dark shade of green. FMSC has recently initiated coverage of ICT, estimating the price to be around 50 pesos per share. Looking forward to 2012, their PE ratio would stand at 15-16 and that would be not factoring in their recent acquisitions. One major factor that may affect growth of earnings, may be the slowdown of trade due to the recent earthquake and tsunami in Japan.
So where do I see the market going from here, I think we're due for a little pullback and that would only mean a better opportunity to jump on the bull market. One thing this comeback has shown is that research(doing you homework) pays off.
I've taken an interest in ICTSI, because of its global story. The company has acquired numerous ports in different countries; ranging from Brazil to China to the USA to Madagascar (you get the picture). And it continues to do so! A good friend of mine tells me that its books are in order and their numbers have a dark shade of green. FMSC has recently initiated coverage of ICT, estimating the price to be around 50 pesos per share. Looking forward to 2012, their PE ratio would stand at 15-16 and that would be not factoring in their recent acquisitions. One major factor that may affect growth of earnings, may be the slowdown of trade due to the recent earthquake and tsunami in Japan.
So where do I see the market going from here, I think we're due for a little pullback and that would only mean a better opportunity to jump on the bull market. One thing this comeback has shown is that research(doing you homework) pays off.
Subscribe to:
Posts (Atom)