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What are this year’s stock market darlings?

EYES WIDE OPEN - Iris Gonzales (The Philippine Star) - January 14, 2021 - 12:00am

Markets are like women, billionaire Rakesh Jhunjhunwala, India’s 39th richest man, once said. “Always commanding, mysterious, unpredictable, and volatile.”

If I were to indulge him in his comparison of markets and women, I would add that indeed, markets like us, can also make you laugh so hard or cry so much.

The Philippine stock market is no exception and, last year, I’m betting it made a lot of people cry.

But as one of the rules of life goes, when something is down, it has nowhere to go but up. The same goes with stocks, even the least-loved issues.

I asked some traders what’s on their list of darlings this year. Some stocks will likely stay charming in the coming months and it wouldn’t be wise to break up with them just yet, traders say.

Here are some of their stock picks:

ABS-CBN

Shares of the beleaguered Lopez-owned company traded at P12.98 per share as of this writing, from an apocalyptic 52-week low of P6.66.

But many believe ABS could easily reach P20 to P24 when the company gets its franchise back. The media giant is too politically important not to be given a new franchise ahead of the 2022 presidential election, says Traders Apprentice Pilipinas.

TAP, a group with a cult following, says a franchise renewal will likely see the stock trade back to P24, the price before it lost the franchise.

Fruitas

As of this writing, FRUIT’s last trading price was at P1.67 per share from a 52-week low of P0.90. Pundits believe the price could reach P2 with prospects of the company rosy.

Last year, Filipino-Chinese businessman Jefferson Ngo acquired 25 million secondary shares, equivalent to a 0.000178 percent stake, from Fruitas Holdings president and CEO Lester Yu at P2 per share, a 20.5 percent premium over the closing price on Dec. 15, 2020 or P50 million.

Ngo wants more, possibly up to a five percent stake in the company in the future, if given the opportunity.

“I believe this is one of the best companies that will really do well in the future,” Ngo, a Wall Street investor, told me in a recent interview.

Fruitas has been putting up more distribution outlets. It has opened its 30th community store under the Babot’s Farm and Soy & Bean brands, achieving its expansion target for 2020. It wants to further expand its community store network to 100 this year.

One random commentary on Twitter says: “At the end of the day, investors want a company to make money... FRUIT acts quickly to protect value and makes adjustment to maximize opportunities.”

Dito

Dennis A. Uy, or DAU – you love him or you hate him. Some businessmen don’t like him, envious perhaps of his ties to President Duterte. But his telco stock speaks for itself. DITO is certainly on the rise – P11.96 per share as of this writing compared to a 52-week low of just a peso.

DITO is gearing up for commercial launch in March. “This is the easiest structure to disrupt as the two existing players – Globe and PLDT – have yet to face ‘serious’ competition for the past 13 years,” TAP says.

Converge

The other Dennis Uy, DHU, is also a newcomer in the telco space and despite the slow-internet issues, traders say CNVRGE is in a sweet spot with a lot of potential for growth. Its price is now at P15.74, still below the IPO price of P16.80 but an improvement from a low of P13.20.

MerryMart

Tycoon Injap Sia II seems to have that lucky touch in the market. Once upon a time, his DoubleDragon also surged to the skies. His grocery chain MerryMart closed at P7.27 per share as of this writing from its IPO price of P1, making the company’s investors truly merry. He has a lot of expansion plans for MerryMart and some ‘tsupiteros’ believe MM’s momentum can continue.

Consumer stocks: JFC, PIZZA, URC, MAXS

And then there are the consumer stocks. This sector, says PinoyInvestor, is poised for a strong rebound this year, boosted by the recovery in consumer sentiment.

Oil exploration stocks: Atok, ACEX, PXP

Market veteran, businessman and art enthusiast Kevin Khoe, one of the people I regularly bother when I’m curious about a certain stock, says exploration plays are  also going to be big because exploration in the West Philippine Sea is likely to happen soon.

Investments

In all, the stock market is a good place to invest in. This was among the key takeaways during last year’s TGFI Bonds and Stocks Online Conference.

Headed by Januarius Holdings CEO JJ Atencio, TGFI is teaching Filipinos how to invest as the country charts its path to be one of the leading emerging markets in the post-COVID-19 era.

“There’s a lot of liquidity in the market now,” says Alex Timbol, a stock market veteran and one of the conference speakers.

Indeed, there’s a lot of opportunities to grow one’s money in the market. But experts stress that investors must also do enough research before playing and, with a bit of good fortune, Lady Luck may smile on you as well.

Iris Gonzales’ email address is eyesgonzales@gmail.com. Follow her on Twitter @eyesgonzales. Column archives at eyesgonzales.com

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