Stock Commentary

Vivant plans P22-B of investments over next six years

Merkado Barkada
Vivant plans P22-B of investments over next six years

Vivant Corporation [VVT 11.28, down 29.5%; 0% avgVol] [link] published a press release to guide the market that it expects “another year of sustained growth” above the P2.3 billion in FY23 operating income that it generated. VVT said that its 43% increase in net income for FY23 was driven by its energy subsidiary, Vivant Energy Corporation (VEC), and that it has a long-term plan to invest up to P22 billion in equity investments over the next six years, with P15 billion of that reserved for “various renewable energy projects.” VVT is an energy and water treatment company owned by the Cebu-based Garcia-Escaño Family.

MB bottom-line: VVT is one of those companies that does good consistent work in a stable and growing sector, but is simply not large enough to get any sunshine from foreign and institutional buyers. VVT’s stock is basically illiquid half of the time and yesterday’s trading session was a great example of that. VVT fell almost 30% yesterday, which (under normal circumstances) should send bright and loud messages to investors about the company and its prospects. But only 100 shares were traded yesterday for a total value of P1,128. What’s worse is that the 100-share trade was the first trade of VVT stock since June 5, when 400 shares were traded for a total value of P6,700. As a result of that 100-share trade, VVT’s theoretical marketcap went from P16.4 billion to P11.5 billion. It’s possible that some rando's trade that is worth less than what I spend on a family meal at Jollibee is representative of the true market price of VVT, but it’s far far more likely that it's just an artifact of there simply being no market for this stock. This isn’t by itself weird or unusual; in the US, there are 20-25% of stocks that don’t see any daily trading volume because they’re smaller and less well-known. But on the PSE, it looks like 36% of stocks had no volume yesterday, which is actually a wild number for an exchange that doesn’t really have that many trading options to begin with. 



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Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.

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