Stocks up on earnings, metals prices

By Ian C. Sayson

Bloomberg

PHILIPPINE stocks rose, sending the key index to a second straight weekly gain. International Container Terminal Services Inc. advanced after reporting its biggest quarterly profit in at least four years. “The company delivered an earnings surprise and the expectation is for its earnings to continue to grow this year,” said James Lago, head of research at Westlink Global Equities in Manila. Separately, “rising metal prices are creating expectations of another round of uptrend for commodities that could boost earnings of miners.” Philex Mining Corp., the nation’s most profitable miner, advanced after the price of copper climbed for a third day. Lepanto Consolidated Mining Co., the nation’s second-largest mining company by market value, rose to a nine-month high. Balabac Resources Holdings Co., an oil explorer that’s expanding into real estate, surged 165 percent this week. The Philippine Stock Exchange index climbed 23.84, or 0.7 percent, to 3389.37 at the close, posting a 1.7 percent advance for the week. The benchmark is less than 60 points away from its record 3447.60 reached on February 3, 1997. It has gained 14 percent this year. International Container, the nation’s largest port operator, jumped P1, or 3.6 percent, to P29, for a 7.4 percent weekly gain. Net income in the three months ended December 31 more than doubled to P536 million, boosted by overseas operations. The figure was derived by deducting nine-month earnings from P1.83-billion full-year net income released by the company Thursday. “We reiterate our ‘buy’ call on ICTSI following an upgrade in our earnings forecasts,” said Michael Bengson, analyst at CLSA Philippines Inc. Bengson raised his 2008 net income forecast by 7 percent to P3.11 billion and upgraded his 12-month share price estimate for the stock to 35 pesos.   Lepanto, Balabac PHILEX, a producer of copper and gold, climbed 35 centavos, or 8.2 percent, to P4.60, a three-month high. The stock ended the week 14 percent higher, its biggest gain since the five days ended June 23. Copper prices in Shanghai rose 1.2 percent to 55,500 yuan a metric ton. The price of the metal has advanced 5.4 percent in the past two days and is headed 8.7 percent higher this week, its biggest weekly gain since July. Lepanto Consolidated’s Class A shares, which are reserved for Filipinos, jumped 2 centavos, or 6.7 percent, to 32. Its Class B shares, which have no ownership restrictions, surged 4 centavos, or 12 percent, to 37, a nine-month high. Balabac, which is owned by the second-richest Filipino, Lucio Tan, soared P1.1, or 33 percent, to P4.40, after jumping 50 percent Thursday. The stock surged 165 percent last week after the company said it’s in talks with Philippine Airlines Inc. to turn an airline property into a residential building. “People are speculating that its expansion into property development will create substantial value for the company,” Westlink’s Lago said. “People are already assigning a number to that prospective value.” Shares worth P5.88 billion were traded, 76 percent more than the six-month daily average. Gainers beat losers 97 to 35, with 12 stocks unchanged in the broader market. Ayala Corp. (AC PM), the nation’s fourth-largest company by market value, advanced P10, or 1.6 percent, to P620. The company said Thursday that its unit LiveIT Solutions Inc. will invest an additional $11 million to expand a subsidiary and finance the purchase of a provider of outsourced business services, the group’s fourth acquisition in eight months. PNOC Energy Development Corp. (EDC PM), the nation’s biggest geothermal energy provider, rose 70 centavos, or 12 percent, to P6.60, its highest ever, after UBS AG advised investors to buy the stock because it’s trading at 11 times estimated 2007 profit while earnings are expected to grow 13 percent a year. PNOC Energy may climb to P7.15 in the next 12 months, Jody Santiago, head of research at the Manila-unit of UBS, said in a note to clients Friday. The estimate represents an 8.3 percent gain from Friday. Geograce Resources Philippines Inc. (GEO PM), which sold its cotton and health-care business to move into mining, surged 22 centavos, or 14 percent, to P1.82. The stock gained 34 percent last week, the biggest advance since the five-day period ended August 4, 2006. Geograce said earlier this week that it may buy a nickel property, its fourth acquisition agreement in a month.IPVG Corp. (IVG PM), a software producer and online-gaming provider, rose 60 centavos, or 11 percent, to P6.30, the highest since January 25, 2000. The company said investors led by chairman Jaime Gonzalez agreed to buy the MBf Group’s entire 12 percent stake in IPVG for $5 million.

 

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