BUY
Long Term Target Price: PHP 52.15

Last Traded Price: PHP 32.95
P/E Ratio: 11.38x
P/B Ratio: 1.34x
Support: PHP 30 – 32.00
Resistance: PHP 36.00
MTD Performance: -11.66 %
YTD Performance: -19.63 %

  • First quarter revenues declined due to the high base effect but net income still grew by 14.6%.
  • Currently undervalued using the P/E ratio.
  • Chart-wise, it formed lower low again, continuing the downtrend.
  • Owing to a significant reduction in consumer visits and a strong base impact, sales in the first quarter of 2021 fell by 7.75 percent y/y to P38.5 billion.
  • Net income increased 14.58 percent year on year to P2.02 billion, owing to the Group’s continued organic growth of supermarket retail stores, strategic cost control, and high customer demand.
  • The firm was demoted to the MSCI Small Cap Index.

We haven’t seen some mass purchasing from customers as a result of the pandemic, but PGOLD has sustained its earnings rise. In addition, with a P/E ratio of about 11x, the stock appears undervalued compared to the 5-year average of 19.66x. However, the stock has been downgraded to the MSCI Small Cap Index, which may intensify negative perception and net foreign selling.

Foreigners had been net sellers for the year to date at P858 million as of yesterday. The company’s declining trend has accelerated since it formed a new lower low.

As a result, we can buy a limited number of them, while the stock can already fall. P32.00 serves as immediate reinforcement, while P36.00 serves as opposition. The cost of psychological assistance is P30.00.

Material in this article is obtained from sources we believe to be reliable, but its reliability or precision cannot be guaranteed. This is for the sole purpose of providing details and does not provide an offer from us to buy or sell securities mentioned in this document.

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