Daily Notes Philstocks Research

Date: January 28, 2020 JUSTINO B. CALAYCAY, JR

Ref: Claire T. Alviar, 8588-1925 AVP-Head, Research & Engagement
(632)588-1962
OUR VIEW JAPHET LOUIS O. TANTIANGCO
Sr. Research Analyst
Be selective on trading amid growing fears (632)8588-1927
over coronavirus. Investors are watching
the developments and the impact of it in PIPER CHAUCER E. TAN
the economy. Engagement Officer/Research Associate
(632)8588-1928
TRADE: UBP hits all-time high income of
P14.0 billion in 2019, over 200% up vs the
previous year. Declared cash dividend of CLAIRE T. ALVIAR
P3.50 per share, ex-date: February 4, Research Associate
2020.
Ground Floor, East Tower
TRADE BLFI [Suspended]; Lifting date: Jan 28, 2020 at 9:00 AM: BDO sells controlling PSE Center, Tektite Towers
stake in BDOLF due to BDO’s restructuring to optimize the financial needs of clients. Ortigas Center, Pasig City
BDO incorporated BDO Finance Corporation to assume current lease transactions PHILIPPINES
booked in BDOLF to provide continuity to existing clients. Timetable will be undertaken
and soon to be-announced. DISCLAIMER
The opinion, views and
recommendations contained in this
MARKET WRAP material were prepared by the
Philstocks Research Team, individually
The local bourse closed in the red territory, down 35.78 points or 0.47% to 7,587.63 as and separately, based on their specific
fears increased over coronavirus outbreak. It was a weak trading day with value turnover at sector assignments, contextual
P4.296 billion while volume is at 1.904 billion, as traders focused on stocks other than those framework, personal judgments, biases
in the PSEi. Decliners beat advancers at 119 to 69, while 42 issues were unchanged. and prejudices, time horizons, methods
and other factors. The reader is
Sector performances were mixed. Financials were on the lead, up 0.22% to 1,814.38 as enjoined to take this into account when
optimism spurred in the banking sector after UBP reported more than doubled income in perusing and considering the contents
2019. Industrials lost the most by 1.37% to 9,594.98. of the report as a basis for their stock
investment or trading decisions.
LT Group, Inc. [PSE:LTG] had the biggest gain of 2.94%, to P10.50 while Bloomberry Furthermore, projection made and
Resorts Corporation [PSE:BLOOM] was at tail-end, down 4.36% to P9.87. presented in this report may change or
be updated in between the periods of
Araneta Properties, Inc. [PSE:ARA] led all shares, surging 24.68% to P1.92 on news that it release. Ergo, the validity of the
will start soon the 800-MW hydro-power facility. projections and/or estimates
mentioned are good as of the date
LOCAL NEWS indicated and may be changed without
immediate notification.
Foreign selling which can drag the market looks to continue amid further review of private
This report is primarily intended for
firms’ contract with the government. The Secretary of Department of Public Works and
information purposes only and should
Highways (DPWH), Mark A. Villar, is willing to find concession contracts for possible
not be considered as an exclusive basis
“onerous” provisions. Currently, UP technohub [ALI], Water concessionaires [MWC, AC,
MPI, DMC], and LRT [MPI, AC] contracts are being investigated. for making investment decision. The
recommendations contained in this
Meanwhile, according to the Bangko Sentral ng Pilipinas (BSP) Governor Benjamin report is not tailored-fit any particular
Diokno, foreign direct investments could recover this year on the back of Citira, or the investor type, situation, or objective
proposed reform on corporate income tax. It aims to have incentives that are performance- and must not be taken as such.
based and the corporate income tax rate to gradually reduced to 20% from 30% in 10 Determining the suitability of an
years. This creates more job for the Filipinos and would be beneficial for further growth. investment remains within the province
However, there are some companies which are against the proposed law especially those of the investor. Our estimates are
under PEZA as incentives could be lowered. Investors’ sentiment about Citira is still mix. based on information we believe to be
reliable. Nevertheless, nothing in this
report shall be construed as an offer of
a guarantee of a return of any kind and
at any time.

Philstocks Research 2020 1 |Page

 DAILY MARKET STATS
GLOBAL NEWS
INDEX VALUE PTS PCT YTD
PSEI 7,587.63 -35.78 -0.47% -2.91%
Miners are expected to benefit as they can sell gold at higher prices in the world market
amid coronavirus fears. Gold jumped more than two-week high, trading above $1,500 per ALL 4,495.34 -28.23 -0.62% -3.32%

ounce as investors shift to safe-haven assets. In China, according to the Chinese officials, FIN 1,814.38 4.01 0.22% -2.64%

the coronavirus outbreak will linger as an issue and travel data has been affected already IND 9,594.98 -133.74 -1.37% -0.42%
by dropping 28.8% vs a year ago. There were also a shortage of medical supplies given the HDG 7,296.45 -51.91 -0.71% -3.89%
strong demand. While in Singapore, it said that its economy will be hit by virus outbreak. PRO 3,969.75 7.43 0.19% -4.45%

SVC 1,534.34 -10.32 -0.67% 0.21%

M&O 7,975.98 7.79 0.10% -1.43%

COMPANY NEWS ASIAN MARKETS (AS OF 03:00 PM)

INDEX VALUE PTS PCT YTD

TRADE Union bank of the Philippines [PSE: UBP] Nikkei 225 23,343.51 -483.67 -2.03% -1.32%

Hang Seng 27,949.64 40.52 0.15% -0.85%

The strong performance of the company will spur optimism in the investors. Also, the positive Shanghai 2,976.53 -84.23 -2.75% -2.41%
outlook for banks this year would sustain the growth of UBP amid accommodative policy of
the government. KOSPI 2,246.13 -21.12 -0.93% 2.21%

HCM 991.46 5.09 0.52% 3.17%

Union Bank reached P14.0 billion in 2019, more than 200% up from P7 billion a year ago SET 1,523.78 -80.33 -1.29% -3.55%
due to the higher revenues, up 44% y/y, driven by increase in loans, improved margins, and
STI 3,240.02 5.46 0.17% 0.53%
strong trading gains. UBP’s total assets grew 15% y/y to P770.9 billion. It declared cash
dividends of P3.50 per share, ex-date is at February 04, 2020. KLCI 1,572.81 -1.63 -0.1% -1.00%

JCI 6,163.78 -80.33 -1.29% -2.16%

Trade cautiously UBP as we may see a correction after the gaps it had from the last trading INTERNALS
days, and we see this declining to support of P59.00 or around P60. Resistance is at P61.45.
20-day EMA crossed above the 50-day EMA—a bullish signal, however, RSI (14) is already VOL 1,904,991,757 ADV 69

at overbought level. On-balance-volume , on the other hand, did not show a huge pick up VAL 4,296,973,300.83 DEC 119
despite the rally, this shows weakness on the rally. BLOCK 528,070,178.37 UNCH 42

Initial target price using technical analysis: P61.45. COMMODITIES & CURRENCIES (AS OF 03:06 PM)

Brent Crude 58.68 -2.02%

WTI Crude 53.03 -2.14%

Gold 1,577.95 0.38%

Silver 18.16 0.30%

Copper 2.63 -1.60%

US$:Php 50.82 0.06%

TOP 5 GAINERS TOP 5 LOSERS
LTG 2.94% BLOOM –4.36%

BPI 0.55% MPI –3.28%

SMPH 0.49% MER –2.78%

ALI 0.48% RLC –2.47%

MBT 0.39% JFC –1.75%

Rating Definitions:
Source: Tradingview BUY - More than 15% upside base on the target price
in the next 9-12 months

HOLD - 15% or less upside or downside in the next

9-12 months

SELL - More than 15% downside base on the target

price in the next 9-12 months
TRADE - A potential 10% and above short-term upside
base on entry price and selling price.

Philstocks Research 2020 2 |Page