Market Event

PAGCOR’s net income in first quarter 2021 (1Q21) dropped by 80% year-on-year (YoY) to P156.2 Million as lockdown measures continue to hamper gaming operations.

Opinion

With the reimposition of MECQ for another two weeks up until May 14, drag to earnings of casinos will extend up to second quarter 2021 (2Q21). 1Q21 numbers of Okada Manila (GGR down by 41% YoY) also portends weak results across all casinos. For BLOOM (Target Price: 8.60), cash balance as of end-2020 at P23 Billion remains sufficient to cover 13-months’ worth of cash OPEX and interest expense.

At current price, BLOOM is trading at 12x full-year 2021 estimate (FY21E) enterprise value /EBITDA vs. 23x of Macau peers. Possible transition to GCQ by 2nd half should improve sentiment on the stock

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