Analysts Count SMC As A Favorite

Reputable securities firms and stock analysts have counted San Miguel Corp. among their stock picks this year, echoing the company's optimism that it can sustain its robust performance in 1999.

At PCCI Brokers, SMC is one of the favorite blue chips because of its acquisition plans. Gonzalo Bongolan Jr., research head of the securities firm, noted that San Miguel is among those dominant in the industry and which have proven to be stable in their businesses. He said SMC's expansion should send a signal to other companies to take a similar bullish stance.

Also recommending that investors go for choice blue chips like San Miguel, an analyst at Orion Squire Securities cited the firm's better earnings prospects and consolidating positions. SMC, in particular, makes for a gratifying play for trading investors because of the company's acquisition moves, Cilette Liboro, research head of Orion Squire, said.

In a recent media briefing, SMC senior vice president and chief financial officer Albert M. de Larrazabal revealed that following the acquisition of Metro Bottled Water Corp., manufacturers of Wilkins distilled water, San Miguel is eyeing four other acquisitions all of which complement the company's lines of businesses. Subsequently, in a disclosure statement to the Philippine Stock Exchange, SMC confirmed it is engaged in negotaitions for the acquisition of Sugarland Inc., makers of Eight o'Clock powdered juice.

Worldsec International Securities is also bullish on SMC, upgrading its recommendation on the company's share to a "Buy" from "Sell on Strength." The securities firm said it had seen some beer volume increases but did not expect it to be rising as fast. If San Miguel's earnings are to be taken as a gauge, "the boom days may be just around the corner," Worldsec vice president for research Eirco C. Claudio said.

SMC posted a net income of P6.02 billion last year, up 82 percent on a recurring basis from 1998.