{"id":327210,"date":"2024-03-22T00:33:56","date_gmt":"2024-03-21T16:33:56","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=327210"},"modified":"2024-03-22T00:33:57","modified_gmt":"2024-03-21T16:33:57","slug":"stock-in-focus-jollibee-foods-corp-jfc-22-march-2024-by-regina-capital-development-corp","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-jollibee-foods-corp-jfc-22-march-2024-by-regina-capital-development-corp\/","title":{"rendered":"Stock in Focus: Jollibee Foods Corp. (JFC) – 22 March 2024 by Regina Capital Development Corp."},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>JFC<\/td><\/tr>
Company Name<\/strong><\/td>Jollibee Foods Corp. <\/td><\/tr>
Broker<\/strong><\/td>Regina Capital Development Corp.<\/td><\/tr>
Opinion Issued on<\/strong><\/td>22 March 2024<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 318.00<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
<\/div>\n\n\n\n

We continue to place a BUY recommendation on JFC with a Target Price of P318.00, giving an upside of +22.31%. We believe international still has a lot of room for growth, while building on existing stores\u2019 growth in the PH.<\/p>\n\n\n\n

<\/div>\n\n\n\n

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

Jollibee Foods Corporation (JFC) net income rose by +508% year-on-year (y\/y) to P1.94 billion in the 4th quarter (4Q) 2023 mainly due to low base effects which saw advertising catch-up, Pho24 impairment, and high tax expenses recorded in 4Q 2022. 2023 net income rose +15.20% y\/y to P244.11 billion despite 2022 including a one-off gain of P4.9 billion from land conveyance and disposals.<\/p>\n\n\n\n

System-wide sales (SWS) grew by +9.6% y\/y to P 94.23 billion in 4Q 2023 and +16.3% y\/y to P 345.32 billion in 2023. Revenues saw a rise of +8.4% y\/y to P66.70 billion in 4Q 2023 and up +15.2% y\/y to P244.11 billion for 2023. SSSGs have been slowing down, with foreign brands in the PH underperforming compared to PH brands. Foreign franchised brands dropped by -7.6% y\/y, while the champion brands saw an increase of +6.9%. GPM improved moderately, a rise of 139bps to 19.65% in 4Q23 and 112bps to 17.44% for FY23. JFC saw its store network rise by +6.3% y\/y to 6,885 stores worldwide.<\/p>\n\n\n\n

Management projects for 2024 that SWS would grow by 10-15%, SSSGs by 5-7%, and store networks globally to increase by 7-8%. JFC will be opening 700-750 owned and franchised stores in 2024. To fund this, capex is set at 20- P23 billion. Despite capex guidance being set at those levels, capex will likely end closer to 2023 levels, with 2024 guidance being the ceiling set by management. 80% of capex will be used for international store openings, with the remaining set for PH.<\/p>\n\n\n\n

Management noted that consumers have shown reluctance to frequent foreign brands as often as they do to champion brands. With this consumer behavior trend, JFC will limit store openings of foreign brands such as Yoshinoya and Panda Express. JFC will be focusing capex on brands that present price points that resonate better with consumer preferences.<\/p>\n\n\n\n

<\/div>\n\n\n\n

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