First Metro Securities sees the tycoon Edgar Saavedra-led precast pioneer entering a stronger growth phase, with its government-backed housing push potentially delivering more than P28 billion in additional revenue over three years.
In a report penned by research head Mark Angeles and analyst Kyle Garcia, First Metro reiterated its buy rating on Megawide and raised its price target to P7.50 from P4.50.
"Together ongoing deleveraging and the potential establishment of regular dividends, we believe 4PH supports a higher valuation multiple and a firmer valuation floor for MWIDE," First Metro said in the report.
The Aug. 31 report updates First Metro’s Sept. 15, 2025 call, when the brokerage first recommended buying Megawide with a 12-month target price of P4.50 per share.
Megawide is among the strongest names in the industry today, with investors rewarding its growth. Its stock price is up about 65 percent since the start of 2026 and more than 135 percent over the past 12 months.
Housing becomes a growth engine
First Metro said Megawide’s participation in the Expanded Pambansang Pabahay para sa Pilipino, or 4PH, program is giving the company a large new source of growth alongside its construction and infrastructure businesses.
The brokerage estimates the first 16,700 housing units covered by its forecasts could generate P28.3 billion in additional revenue from the second half of 2026 through 2028, when 4PH could account for 36 percent of Megawide’s total revenue.
First Metro’s Megawide growth case:
First Metro said that larger pipeline gives Megawide room to turn affordable housing into a major business beyond the projects already included in the brokerage’s forecasts.
Pag-IBIG provides a boost
Megawide is a construction and engineering infrastructure company whose projects have included public school buildings, airports and the Parañaque Integrated Terminal Exchange, with First Metro pointing to its experience and precast technology as advantages in rapidly building homes at scale.
The brokerage said Megawide’s partnership with Pag-IBIG Fund, which is investing P10 billion through preferred shares to support at least 7,000 affordable homes, also gives the company an important source of upfront funding.
First Metro said the arrangement could make the housing business less cash-intensive and more predictable than conventional construction projects because funding and collections are more closely tied to construction progress.
Profits come into view
First Metro expects Megawide to swing from a P164-million net loss in 2026 to a P1.09-billion profit in 2027, while revenue is projected to jump 32 percent to P28.11 billion as the housing rollout accelerates.
The brokerage also expects Megawide’s debt position to improve and pointed to the return of dividends, along with plans for regular payouts starting in 2027, as further signs of strengthening finances.
First Metro arrived at its P7.50 target price by averaging valuations of P9.28 based on future earnings, P6.03 based on book value and P7.10 based on projected cash flows, while flagging housing delays, slower collections, weaker demand and persistently high interest rates as key risks.
—Edited by Miguel R. Camus
