{"id":331722,"date":"2025-02-28T01:13:06","date_gmt":"2025-02-27T17:13:06","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=331722"},"modified":"2025-02-28T01:13:09","modified_gmt":"2025-02-27T17:13:09","slug":"stock-in-focus-globe-telecom-glo-28-feb-2025-by-regina-capital-development-corp","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-globe-telecom-glo-28-feb-2025-by-regina-capital-development-corp\/","title":{"rendered":"Stock in Focus: Globe Telecom (GLO) – 28 Feb 2025 by Regina Capital Development Corp."},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>GLO<\/td><\/tr>
Company Name<\/strong><\/td>Globe Telecom<\/td><\/tr>
Broker<\/strong><\/td>Regina Capital Development Corp.<\/td><\/tr>
Opinion Issued on<\/strong><\/td>28 Feb 2025<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 2,670.00<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n
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We revise our recommendation to BUY rating on GLO with a target price of P2,670, representing an upside of +17.62% from its last traded price. This reflects GLO\u2019s solid revenue growth, margin expansion, and strategic focus on data and fintech. Improving ARPU, lower churn, and disciplined capital spending further support its long-term outlook, though risks include inflationary pressures that could hinder consumer spending and uncertainties surrounding Mynt\u2019s profitability.<\/p>\n\n\n\n

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

Globe Telecom, Inc. (GLO) closed 2024 with record gross service revenues of P165.0 billion, up +2% year-on-year (y\/y), driven by mobile and corporate data growth despite headwinds from home broadband normalization, ECPay deconsolidation, and inflationary pressures. <\/p>\n\n\n\n

EBITDA rose +7% y\/y to P86.8 billion, with a 52.6% margin, while net income declined -1% to P24.3 billion due to fewer SLB closings and higher costs; however, normalized net income grew +13% y\/y to P21.7 billion. Mobile service revenues hit P116.7 billion (+4% y\/y), led by a +7% increase in mobile data to P97.4 billion (83% of mobile revenues), offset by declines in voice (-6% y\/y) and SMS (-16% y\/y), reflecting the ongoing shift to data-driven services.<\/p>\n\n\n\n

GLO\u2019s ARPU saw strong gains in 2024, with Postpaid up +7% y\/y and Prepaid and TM rising +22% and +35% y\/y, fueled by better data monetization, market repair efforts, and increased mobile app usage. Subscriber growth rebounded as churn rates dropped to 2.0% from 5.9% y\/y, adding 3.9mn users, with Prepaid leading acquisitions despite an 18% decline in gross additions. <\/p>\n\n\n\n

Meanwhile, cash capex fell -20% y\/y to P56.2bn as GLO prioritized capital efficiency, lowering the capex-to-revenue ratio to 34% from 44%. Despite reduced spending, 90% of capex was allocated to data expansion, supporting 1,212 new cell sites, 4,613 LTE upgrades, and 67,456 FTTH line deployments.<\/p>\n\n\n\n

GLO\u2019s fintech arm, Mynt, continued its strong growth in 2024, with GCash expanding its user base and profitability through digital services. Rising equity earnings, surging GStocks and insurance users, and growing lending reinforced GLO\u2019s fintech leadership. Investors await updates on Mynt\u2019s IPO, though no clear date or announcement has been made. <\/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>