{"id":324511,"date":"2023-08-17T01:09:22","date_gmt":"2023-08-16T17:09:22","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=324511"},"modified":"2023-08-17T01:09:23","modified_gmt":"2023-08-16T17:09:23","slug":"stock-in-focus-international-container-terminal-services-inc-ict-17-aug-2023-by-ap-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-international-container-terminal-services-inc-ict-17-aug-2023-by-ap-securities\/","title":{"rendered":"Stock in Focus: International Container Terminal Services Inc. (ICT) – 17 Aug 2023 by AP Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>ICT<\/td><\/tr>
Company Name<\/strong><\/td>International Container Terminal Services Inc.<\/td><\/tr>
Broker<\/strong><\/td>AP Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>17 Aug 2023<\/td><\/tr>
Recommendation<\/strong><\/td>Accumulate<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 257.00<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

While consumption in the PH may be heading towards more tepid territories, we note that ICT may benefit from global seasonality trends in Q3 which is typically the peak of the shipping season. Demand for containers is likely to improve sequentially as retailers stock up on inventory. Given this along with the continued solid performance of ICT\u2019s financials, we would therefore advise investors to accumulate.<\/p>\n\n\n\n

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

Earnings remain resilient<\/strong><\/p>\n\n\n\n

ICT\u2019s profits for the first half of the year came in-line with our figures (53.1% of our estimate), with Q2 also settling within expectations at 27.0%. Performance was underpinned by systemwide yield-per-TEU remaining above the 180\u2019s range, staying true to management\u2019s guidance that the company would make up for volume challenges through higher yields. The bottomline was notably tempered by the recognition of a goodwill impairment charge amounting to USD10.62-Million, following the expiration of PICT\u2019s concession last June 18. While no exact breakdown of earnings excluding PICT\u2019s contribution was provided, we note that Q2 EBITDA excluding discontinued businesses and the contribution of the relatively new MNHPI (Manila North Harbor Port, Inc.) logs in at P363-Million, still in-line with our own EBITDA projection. <\/p>\n\n\n\n

Volumes maintain upward trajectory, while yields remain stable<\/strong><\/p>\n\n\n\n

Despite the presence of macroeconomic headwinds, volumes for 1H 2023 managed to register growth of 9.1% with Asia leading the expansion. The significant increase in Asian TEUs was brought about mostly through the continued consolidation of MNHPI. This was more than enough to offset the 3.3% drop seen in EMEA. While blended yields for the period were down slightly compared to the previous year, Q2 was a little better as the quarter saw yields rise by 1.1% to USD181 per TEU. The primary driver of yield performance was the Americas segment which saw healthy double-digit expansion on the back of tariff adjustments, better volumes, and higher ancillary revenues. In contrast to its volume leadership however, Asian yields diluted overall yield performance on account of the continued consolidation of MNHPI.<\/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>