{"id":327832,"date":"2024-05-09T17:29:45","date_gmt":"2024-05-09T09:29:45","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=327832"},"modified":"2024-05-09T17:29:47","modified_gmt":"2024-05-09T09:29:47","slug":"stock-in-focus-universal-robina-corp-urc-9-may-2024-by-ap-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-universal-robina-corp-urc-9-may-2024-by-ap-securities\/","title":{"rendered":"Stock in Focus: Universal Robina Corp. (URC) – 9 May 2024 by AP Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>URC<\/td><\/tr>
Company Name<\/strong><\/td>Universal Robina Corp.<\/td><\/tr>
Broker<\/strong><\/td>AP Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>9 May 2024<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 149.76<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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As we begin to see growth across all of URC\u2019s segment, we expect this to continue moving forward, anchored on the pick-up in consumer demand as inflation eventually subsides. When coupling the outlook alongside URC\u2019s substantial upside of 48.2% at its consensus Target Price of P149.76, we believe that this further validates our BUY rating on the stock.<\/p>\n\n\n\n

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

In-line earnings<\/h3>\n\n\n\n

URC\u2019s core earnings of P3.92-Billion came in-line, beating consensus estimates by 5.2%. URC generated revenues of P41.6-Billion for 1Q 2024, up 7% yearon-year (YoY) attributable to substantial improvements in sales volumes across all divisions. Overall EBIT margins grew 100 bps on a YoY basis. The margin expansion was driven by several factors, namely: (1) increased volumes and favorable sales mix, and (2) cost savings initiatives and lower input costs.<\/p>\n\n\n\n

On their BCF segment<\/h3>\n\n\n\n

BCF Philippines grew 6%, mostly driven by volume growth across the majority of their categories such as potato-based (+8%) and non-potato-based (+17%) snacks, bakery products (+67%), and ready-to-drink (RTD) beverages (+22%). The mix of volume growth, cost savings, and lower material input costs drove significant margin expansion of 90bps from 1Q 2023\u2019s 12.2% to 1Q 2024\u2019s 13.1%. <\/p>\n\n\n\n

Despite stabilizing market share trends, coffee remain a challenge although management stated that a number of strategic moves are already in place. On our end however, we are still waiting for further clarity on what the exact nature of this strategic plan is, and how this will be implemented. BCF international grew 4% YoY on constant currency driven by market share gains in 3 countries (Vietnam, Myanmar, and Malaysia).<\/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>