Go, whose last purchases were made in April 2024, acquired shares at average prices ranging from P61 to P67, spending about P56 million between Feb. 10 and Feb. 18.
Was Go making a Valentine’s Day splurge? More likely, he was locking in bargains with URC trading near multi-year lows.
COL Financial Group chief equity strategist April Lynn Tan said the firm has a “buy” rating on both JG Summit Holdings and URC, especially now that the overhang from its MSCI index removal has been resolved.
For Tan, this creates “an opportunity for investors to buy the two stocks at much [lower] prices and to capitalize on a possible short-term oversold rally.”
URC opportunity
Tan said their fair value estimate on URC is P107 per share, significantly higher than its current price of P66.75.
“Despite its poor near-term outlook, we believe that many of its challenges (e.g., weak sugar prices, prolonged downtrading among consumers) are cyclical in nature and should ease once household consumption normalizes,” she said.
The stock also looks like a good deal, trading at 11.3 times its estimated 2025 earnings while offering a solid 5.7 percent dividend yield.
JG Summit also a buy
Tan said their fair value estimate for the Gokongwei family’s conglomerate, JG Summit Holdings, is P34 per share—higher than the current price of P16.06 per share.
“[We] believe that the weaknesses of its petrochemical business and core subsidiaries are already priced in,” she said.
“In fact, plans to indefinitely suspend the operation of its petrochemical business could be a catalyst, as it should allow profits to rebound going forward, improving the company’s longer-term outlook,” she added.
Why haven’t prices recovered?
Apart from fundamentals, stock prices are also affected by market sentiment, which remains shaky due to global economic uncertainties.
In the case of URC, Tan said there’s concern over weak coffee sales and risks to margins.
She also pointed to challenges in the sugar segment, where poor sugarcane yields are keeping raw sugar prices high, while refined sugar prices remain low, making a sustained recovery uncertain.
Financial market recommendations and comments on InsiderPH News belong solely to the analysts and institutions making them. They do not represent buy, sell or hold recommendations of InsiderPH News. Investments held by analysts or institutions may influence their recommendations. Investors should conduct their own research and carefully evaluate all relevant market information before making investment decisions. As always, the past performance of any investment does not guarantee its price appreciation in the future.
Miguel R. Camus has been a reporter covering various domestic business topics since 2009.
