{"id":326870,"date":"2024-02-22T12:49:27","date_gmt":"2024-02-22T04:49:27","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=326870"},"modified":"2024-02-22T12:49:28","modified_gmt":"2024-02-22T04:49:28","slug":"stock-in-focus-pldt-inc-tel-22-feb-2024-by-ap-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-pldt-inc-tel-22-feb-2024-by-ap-securities\/","title":{"rendered":"Stock in Focus: PLDT Inc. (TEL) – 22 Feb 2024 by AP Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>TEL<\/td><\/tr>
Company Name<\/strong><\/td>PLDT Inc.<\/td><\/tr>
Broker<\/strong><\/td>AP Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>22 Feb 2024<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 1,661.08<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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We continue to recommend a BUY on TEL based on consensus Target Price of P1,661.08 per share. Additionally, it should be highlighted that the stock offers the highest dividend yield in the sector, with a projected 2024 dividend yield of 7.43%.<\/p>\n\n\n\n

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

PLDT Fiber making rich-kid moves<\/h3>\n\n\n\n

The Pangilinan-led telco recently unveiled that it would be introducing a sleuth of ultra-premium fiber offerings dubbed as \u201cGigabit Fiber.\u201d Under these plans, consumers can enjoy speeds ranging from 1gbps up to a maximum of 10gbps, with price points starting at P7,499 and rising to as high as P49,999. As noted by Inquirer, the cost of the highest-end plan is 29 times more than PLDT\u2019s cheapest fiber offering of only P1,699. In addition to the significant speed advantages, these plans also offer several perks such as subscriptions to various streaming platforms along with a built-in cybersecurity package.<\/p>\n\n\n\n

Zig while the market zags<\/h3>\n\n\n\n

The move is certainly a bold one on PLDT\u2019s end, seeing as the trend in the industry nowadays is to gun for cheap and affordable fiber products, hence the continued aggressiveness of both Converge and Globe in the prepaid fiber market. Nevertheless, we note that the venture is also a calculated one seeing as the higher price points play to PLDT\u2019s strengths which lie mainly in its capacity to uphold higher broadband Average-Revenues-Per-User (ARPUs), while also opening the door to some potentially new benefits. <\/p>\n\n\n\n

In the past couple of quarters, PLDT\u2019s ability to acquire new fixed line broadband subscribers appeared to be on the downtrend, as signified by the declining QoQ growth rates in its subscriber count. In contrast to this, the second top fiber player Converge saw its rate of acquisitions continue to pick up the pace. On the other side of the spectrum though, PLDT ARPUs were much stronger, coming in above the P1,400 mark and exceeding Converge\u2019s own by almost 20%. The coming quarters will likely see the disparity between their ARPU levels grow as Converge continues to roll out more affordable mass market offerings such as its prepaid and Bida fiber plans.<\/p>\n\n\n\n

By making the move towards more premium offerings, we think that PLDT can further accentuate its strengths by allowing it to focus more on further growing its broadband ARPUs. While this doesn’t mean that PLDT will not be exploring the prepaid fiber market as well, the addition of more premium offerings into the mix nevertheless broadens PLDT’s capacity to shore up its ARPU advantage rather than purely playing CNVRG’s game of volumes. <\/p>\n\n\n\n

This in turn, would inject further upside to its fiber revenues which are currently seeing double-digit growth of 10%. Additionally, given that the majority of higher income families reside in the more urban areas, the move to target this market segment would save PLDT the time, money, and effort of having to prioritize fiber network expansion and market share-grabbing in the more rural areas wherein infrastructure rollout would be a more difficult undertaking. This then aids PLDT in its efforts to further lower costs and delever in order to boost free cash flows.<\/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>