{"id":324403,"date":"2023-08-11T00:37:36","date_gmt":"2023-08-10T16:37:36","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=324403"},"modified":"2023-08-11T00:37:38","modified_gmt":"2023-08-10T16:37:38","slug":"stock-in-focus-dmci-holdings-inc-dmc-11-aug-2023-by-ap-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-dmci-holdings-inc-dmc-11-aug-2023-by-ap-securities\/","title":{"rendered":"Stock in Focus: DMCI Holdings Inc. (DMC) – 11 Aug 2023 by AP Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>DMC<\/td><\/tr>
Company Name<\/strong><\/td>DMCI Holdings Inc.<\/td><\/tr>
Broker<\/strong><\/td>AP Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>11 August 2023<\/td><\/tr>
Recommendation<\/strong><\/td>Hold<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 11.85<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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We still like DMC for its dividend yields, but given the headwinds on most of the company\u2019s business units we maintain a HOLD on DMC despite the 23.4% upside to consensus Target Price of P11.85.<\/p>\n\n\n\n

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Analysis and Opinion<\/h2>\n\n\n\n

Net income declined less than expected<\/strong><\/p>\n\n\n\n

DMCI Holdings, Inc. (DMC) recorded an 8.7% year-on-year (YoY) decline in earnings in 2Q 2023, while first half earnings dropped by 21.8%. Despite the decline, 2Q 2023 earnings came in 23.3% ahead of forecasts. Weak contributions from coal and nickel mining units were underpinned by power generation and water distribution units.<\/p>\n\n\n\n

Construction and real estate businesses remain challenged<\/strong><\/p>\n\n\n\n

DMC’s 2Q 2023 revenues for real estate unit DMCI Homes and construction unit D. M. Consunji, Inc. dropped by 14% and 23% respectively on lower construction accomplishments, along with higher revenue reversals from real estate sales cancellations and fewer new real estate accounts that qualified for revenue recognition. Weakness in the Homes segment was somewhat offset by higher interest income from in-house financing, which boosted interest income by 2.7x from P55 Million to P146 Million.<\/p>\n\n\n\n

Company expects sluggish 2023<\/strong><\/p>\n\n\n\n

The ongoing normalization of commodity prices from last year\u2019s high base, coupled with unfavorable weather conditions in the coming months, would continue to weaken DMC\u2019s mining units. While high interest rates, tight credit standards, and excess supply would also make rough going for the construction and real estate segments.<\/p>\n\n\n\n

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Check how many brokers recommend this stock<\/h2>\n\n\n\n
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All Stock Rankings<\/a><\/blockquote>