TEL: Where To Now?

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After all the negativity that lurked in the stock market(and I guess it is still lurking out there in Europe), the Philippine Stock Exchange is again in the positive and 5,000 level area. 

source: http://www.pldt.com.ph/

One of the stocks everybody would probably want to have in their portfolio is TEL(PLDT). I once posted here about TEL's not so stellar performance in 2011, when PLDT chairman Manuel V. Pangilinan announced in their  FY 2011 Core Income Reports that they are not expecting to have a very bright 201 and even maybe in 2012 but rather see this as a period of re-alignment in connection to PLDT's acquisition of Digitel. And as everyone knows, PLDT's share have gone done to as low as 2300 levels for the past months which believe was mainly due to the issue on the capital requirements which finally resolved.

Looking at the chart today I see some sudden rise in the past 3-4 days even in the midst of the turmoil in the stock market world.

When I read and have seen that PLDT started to go south I started buying blocks of shares to take advantage of the low price of this blue chip but having to chunk out huge portion of your portfolio did have a drawback. One is that I missed out profit taking on small stocks that went up during those bearish months. Another is that PLDT's share price didn't really drop at an instant but slowly thus I ended up not effectively cost averaging and have to stop buying when TEL was nearly 50% of my portfolio.

A little more and I can see the fruits of my patience.

Some good news I am hearing are below:

• PLDT's branding alliance with SM
• PLDT sees better second half of 2012
• PLDT eyes TV station in Indonesia  

 With that, I guess PLDT is again positioned to achieve its stellar performance in 2010 of having an all time high net income of 42 billion.

As for me I am crossing my fingers and hope that in the coming months my patience pays of with TEL.

TEL 2011 Full Year Core Income Press Release

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Was checking some of active stocks in the Philippine stock when I got directed to PLDT(TEL)'s website and seen the press release of their FY 2011 Core Income Reports.

To check the report you can check it by clicking here.

source: http://manuel-pangilinan.seebyseeing.net/

From the very own words of PLDT chairman Manuel V. Pangilinan, they are not expecting 2012 to be a high income year but would see it as a period of re-alignment with their latest acquisition of Digitel. He believes that it would take time for the company to realize the benefits of the combined telecommunication companies operation and they are expecting a surge of income starting 2013. 

Also the report mentioned that amidst the capital expenditure related to the acquisition of Digitel, PLDT(TEL) is still able to deliver the minimum dividend payout of 70% of core income. And with that another dividend payout is slated on April this year to fulfill the 100% dividend declaration. I guess such will again make the stock in demand at least for those who do dividend play. 

For those who are accumulating PLDT(TEL) shares, we have to catch dips this year and accumulate as much as we can in preparation for the coming years of PLDT's profitable operations.

PLDT - DGTL deal finally approved

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source: http://teknisyan.net

Got this news today from Businessworld @ www.bworldonline.com

This deal has been hanging since June and PLDT has to sacrifice some in order for this to culminate. The main sacrifice made was a divestment of one of PLDT's frequencies which would as they say make the playing field level with Globe Telecom.

Below is an excerpt of the news:

source: http://www.bworldonline.com

PLDT-Digitel deal approved

PHILIPPINE Long Distance Telephone Co. (PLDT) completed on Wednesday its delayed takeover of rival Digital Telecommunications Philippines, Inc. (Digitel), saying regulators had approved the transaction. The National Telecommunications Commission (NTC) confirmed that it had greenlighted the P69.2-billion deal -- announced early this year and originally scheduled for completion in June -- but also put in place several conditions that included the dominant telco’s divestment of some of its frequencies.

PLDT said it had accepted the NTC’s requirements, while second-ranked Globe Telecom, Inc. -- which had questioned the purchase and claimed that it would lead to a return to a monopoly -- said it was satisfied that regulators had moved to protect consumers and promote fair competition.

source: http://www.philippinenewsdaily.com

PLDT’s acquisition of JG Summit Holdings, Inc.’s 51.55% stake in Digitel will give the dominant telco some 70% of the domestic mobile market, leaving Globe about 30%. PLDT said it would soon announce a tender offer for the rest of Digitel.

Shortly after PLDT’s announcement, 3.277 billion shares of Digitel changed hands via a cross sale in the stock market at P1.6033 per share.

In exchange for the Digitel stake, JG Summit will get 12.9% of PLDT, comprising 27.7 million common shares at P2,500 apiece.

PLDT also acquired the zero-coupon convertible bonds issued by Digitel to its parent and assumed P34.1 billion in advances made by JG Summit to Digitel.

“After due evaluation of the various factors and issues involved, it has granted the application for approval of the sale and transfer to the PLDT of initially approximately 51.55% equity in Digitel,” NTC commissioner Gamaliel A. Cordoba said in a press conference.

The NTC decision came a day before a 90-day review period was to expire. The protracted regulatory approval period had prompted PLDT and JG Summit to thrice suspend the deal’s planned completion.

The regulator said PLDT would have to continue Digitel’s unlimited text and call services. “Regarding the unlimited services, we want it to be permanent, continuous and we want a nationwide-reach [for these services],” Mr. Cordoba said, adding that Digitel’s mobile service should be kept separate.

PLDT was also required to divest 10 megahertz of 3G frequencies held by Connectivity Unlimited Resource Enterprises, Inc. (CURE), a unit of subsidiary Smart Communications, Inc. CURE’s frequencies will be auctioned off and PLDT will not be allowed to bid, Mr. Cordoba said.

“Another condition requires PLDT and Digitel to continue providing high quality service to their respective subscribers,” he said. 

(Click here to read more of this news)

This news suddenly made the price of TEL surge 

source: http://www.pse.com.ph

Coupled with the recent news in the Eurozone that the Greek bailout has finally been made we are hoping that today's positive news will continually drive the PSEi to rise to its previous high and hopefully bring back the bullish air in the Philippine Stock Market.

Listed Company Profile: Meralco

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source: http://www.meralco.com.ph/

We have been waiting for this giant to rise up and be one of the leading stocks in the PSE.

About 2 months ago I was checking this stock and I knew there is something with this company. Being one of MPI's gem in their list of stocks and as well as the recent move by SMC the price of MER suddenly rose rapidly at year end it posted a 237.00 and nearly surpass its all time high of 292.00 in the first weeks of 2011 when it posted a 287.00 per share market price.

Originally a Lopez company, the entry of Manny Pangilinan's First Pacific Holdings through Metro Pacific Investments have given boost to MER's planned entry to the power generation sector a move from power retailer to power producer. And the latest is the entry of Ramon Ang of SMC .

Looking at its price it seems to hit another high after the uneasy start of 2011. 

I have seen a rise in its price back in Nov 2010 thus bought some until it went down due to year end jitters. After cost averaging till the end of 2010 I was looking at a 225 target price with a 15% gain but it went far beyond my expectation. Right now it sits at 280.00.

source: www.bloomberg.com

In fundamental aspects Meralco is in good shape having a good current ratio at 1.10 and a PE% of 35 (MRQ source www.reuters.com). Outlook on 2011 is positive and if MER's plans to get into self-generation of electricity it might have a better market price as what was seen with SCC.