The 1st quarter (1Q) 2025 scorecard of PSE-listed firms shows that incomes came in largely as expected, with 73% of companies reporting earnings in line with consensus, while only 9% beat and 18% missed.<\/p>\n\n\n\n
PSE index target still at 7,400<\/strong><\/p>\n\n\n\n The quarter came in at 21.4% of our full-year target, just a hair below the historical seasonality of 22%. Our +10.2% full-year forecast still looks achievable, and we stick to our year-end PSE index target of 7,400.<\/p>\n\n\n\n Standouts: AC, URC (strong demand & execution) Outperformance came from select names in Conglomerates and Consumer, such as Ayala Corp. and URC, which benefited from strong segment execution and demand recovery. On the flip side, Telcos, Energy, and Property saw some disappointments.<\/p>\n\n\n\n 2025 Earnings forecast<\/strong><\/p>\n\n\n\n We cut our 2025 earnings forecast slightly to 10.2% from 11%, in-line with consensus 2025 revision trend which is Positioning for 2H 2025<\/strong><\/p>\n\n\n\n With 1Q 2025 earnings largely in line with expectations, the strategy for the 2nd half (2H) this year is to rotate into sectors showing strong momentum and macro leverage. <\/p>\n\n\n\n Our conviction basket includes: SM, JFC, MONDE, ALI, BDO, MBT, AP, CNVRG.<\/p>\n\n\n\n Positive: Transport, Consumer, Property (rising demand, tourism, falling rates).
Underperformers: GLO, ACEN, AREIT (cost pressures, project delays)<\/p>\n\n\n\n
also flat. Despite the minimal downgrade in our EPS growth forecast, we stick to our yearend index target of 7,400,
translating to 11.9x P\/E which is one standard deviation below 5-year mean. The market trades at 11.2x P\/E current
and 9.9x P\/E forward \u2013 way below its 5-year average of 15x.<\/p>\n\n\n\n
Neutral to cautious: Telcos, Mining (watch for cost\/commodity trends)
Banks: Steady earnings, macro-leverage play in easing rate environment.<\/p>\n\n\n\n