{"id":330248,"date":"2024-11-05T15:24:47","date_gmt":"2024-11-05T07:24:47","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=330248"},"modified":"2024-11-05T15:24:52","modified_gmt":"2024-11-05T07:24:52","slug":"stock-in-focus-sm-prime-holdings-smph-5-nov-2024-by-ap-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-sm-prime-holdings-smph-5-nov-2024-by-ap-securities\/","title":{"rendered":"Stock in Focus: SM Prime Holdings (SMPH) – 5 Nov 2024 by AP Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>SMPH<\/td><\/tr>
Company Name<\/strong><\/td>SM Prime Holdings<\/td><\/tr>
Broker<\/strong><\/td>AP Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>5 Nov 2024<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 40.30<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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We continue to view these progressions as something that would result in a substantial boost in the company\u2019s earnings with SMPH continuing to dominate the mall scene. We therefore reiterate our BUY rating for the stock with a Target Price of P40.30 which translates to a notable upside of 36.1% from its last traded price.<\/p>\n\n\n\n

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

Larger CAPEX<\/strong><\/p>\n\n\n\n

SMPH recently announced their plans to allocate a CAPEX of up to P110-Billion next year to fund plans to build 5 more malls, bringing the company\u2019s portfolio to 92 malls and cementing its spot as the largest mall developer in the country. <\/p>\n\n\n\n

SMPH\u2019s 2025 CAPEX budget is 10% larger than this year\u2019s allocation of P100-Billion, albeit management stated that they are not expecting to hit this CAPEX target this year as they have only spent P40-Billion of this amount as of 1H 2024. We note though that the company has managed to launch 3 out of 4 malls targeted to launch this year, the most recent one being the 123,000 sqm SM City J Mall in Cebu, which was launched just last October 25. The last mall, SM City Laoag, is targeted to launch around December. This shows SMPH\u2019s capabilities to hit their target which should then translate to earnings as early as next quarter.<\/p>\n\n\n\n

Where to?<\/strong><\/p>\n\n\n\n

The company is looking to erect five more malls next year, specifically in La Union, Zamboanga, Ilocos Norte, and Laguna for the four locations while the fifth has yet to be finalized. Additionally, management also has several mall redevelopments in Cebu, Rosales, and Pangasinan lined up, with forecasted redevelopment costs of P800-Million to P1.5-Billion for each location. <\/p>\n\n\n\n

We note that SMPH\u2019s mall segment, on average, take up around 40% of CAPEX every year and we think that this will continue to be the case in the near future as SMPH continues to strategically align its portfolio to cater towards consumer demand. As we have previously noted, we are optimistic on the PH consumption story moving forward, driven by a combination of improvements in macroeconomic conditions such as moderating inflation, brighter GDP outlook, and the recent string of wage hikes.<\/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>