{"id":330980,"date":"2024-12-19T00:48:32","date_gmt":"2024-12-18T16:48:32","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=330980"},"modified":"2024-12-19T00:48:34","modified_gmt":"2024-12-18T16:48:34","slug":"stock-in-focus-bloomberry-resorts-corp-bloom-19-dec-2024-by-rcbc-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-bloomberry-resorts-corp-bloom-19-dec-2024-by-rcbc-securities\/","title":{"rendered":"Stock in Focus: Bloomberry Resorts Corp. (BLOOM) – 19 Dec 2024 by RCBC Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>BLOOM<\/td><\/tr>
Company Name<\/strong><\/td>Bloomberry Resorts Corp.<\/td><\/tr>
Broker<\/strong><\/td>RCBC Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>19 Dec 2024<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 10.00<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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We retain our BUY rating on Bloomberry Resorts Corporation (BLOOM) since we think the VIP segment will recover next year, with tourist arrivals projected to hit the 2019 level of around 8.3 million. Furthermore, yesterday BLOOM\u2019s share price reached its lowest since March 16, 2020, indicating a good buying opportunity.<\/p>\n\n\n\n

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

Earnings recap<\/strong><\/p>\n\n\n\n

BLOOM reported a 9-months (9M) 2-24 net income of Php3.5 billion, 57% down year-on-year (y\/y), and missing our estimates. Gross gaming revenues (GGR) grew 2% to Php44.5 billion, primarily attributed to the 23% drop in VIP GGR and the 5% slide in mass tables GGR. Operating costs and expenses rose by 27% on the back of SRN\u2019s expenses. As a result, EBITDA was at Php12.6 billion, 18% lower y\/y.<\/p>\n\n\n\n

Earnings forecasts tempered<\/strong><\/p>\n\n\n\n

We tempered our net income forecasts for this year and 2025 following the disappointing 9-months (9M) 2024 results, dragged down by interest expenses and operating costs of Solair Resort North (SRN) in its first full quarter of operations. GGR also has not recovered for its VIP segment because of the lack of Chinese players. Hence, we slashed our target price (TP) by 13% to Php10.00 from Php11.50, as we also lowered our GGR assumptions for SRN, which has not been able to increase its volumes and tap the Northern Luzon market (Pampanga and Bulacan) as intended.<\/p>\n\n\n\n

VIP woes<\/strong><\/p>\n\n\n\n

GGR growth slowed to 2% in the first nine months, mainly attributed to the absence of Chinese players, with the VIP rolling chips dropping by 23% year-on-year (y\/y) and 5% quarter-on-quarter (q\/q). It may have been due to China\u2019s 3Q24 GDP, which grew by 4.6%, slower than 2Q24, the slowest pace since early 2023. There could be a potential rebound in this segment next year, fuelled by the expected increase in tourists. In addition, China\u2019s stimulus could boost its GDP and push the return of the Chinese players.<\/p>\n\n\n\n

Solaire North still ramping up<\/strong><\/p>\n\n\n\n

During its first full quarter of operations, SRN recorded Php3.3 billion in revenues, driven by the slots and mass segments. Meanwhile, its newly opened VIP segment (last September) recorded negative revenues as its hold rating was -1.0%. Management says SRN is still ramping up, aiming to take more share from its northern target market.<\/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>