Economic reopening boosts appetite for SM Prime stocks

SM PRIME HOLDINGS, Inc. was one of the most actively traded stocks in the local bourse last week as investors’ appetite increased due to normalized stock prices following the further improvement of the economy.

SM Prime had the second highest value turnover last week, with P1.27 billion worth of 40.315 million shares exchanging hands from Oct. 8 to 14, data from the Philippine Stock Exchange show.

The share price of the Sy-led property firm closed at P31.80 apiece on Friday, up 1.3% from the previous day and 1.1% week on week. For the year, the stock has gone down 5.1%.

SM Prime’s stock price fell 1% and 0.5% to P31.15 and P31 per share on the first two trading days last week, but the next three days saw its price rebound by 0.6%, 0.6%, and 1.3%, respectively.

“Investor appetite is focused on stocks that have normalized (back to pre-pandemic) like SM Prime’s foot traffic, a strong indicator of recovering fundamentals,” said Cristina S. Ulang, research head at First Metro Investment Corp.

Ms. Ulang added that the opening of SM City Tanza would add to the company’s net asset value, revenue, and earnings per share growth outlook next year.

SM City Tanza opened its doors to the public last week, making it SM Prime’s 80th mall. It is also the seventh “supermall” in Cavite after SM City Bacoor, SM City Dasmariñas, SM City Molino, SM City Rosario, SM City Trece Martires, and SM Center Imus.

“With the continuous improvement in our local economy, we hope that SM City Tanza will be an avenue of opportunities for local SMSEs to grow as well as for local employment to prosper and drive progress not only in Tanza but in the whole province of Cavite,” SM Prime President Jeffrey C. Lim said in a report.

For Aniceto K. Pangan, equity trader at Diversified Securities, Inc., SM Prime became one of the most active stocks last week following a sell-off in the market.

“SM Prime is among the most active stocks this week as investors accumulated with price valuation becoming attractive as price go down with the recent selloff in the market despite its recent expansion in Tanza, Cavite and earnings growth due to the reopening of the economy,” Mr. Pangan said in a mobile phone message.

Mr. Pangan added that with the easing in restrictions and reopening of the economy, the company may continue to expect a double-digit rise in revenue for the year. He gave an estimate of P18 billion for the third quarter. —In the second quarter, the company’s consolidated net income rose 32.7% to P6.857 billion. Buoyed by mall business revenues, first-half income grew by 23% to P14.373 billion.

SM Prime opened SM City Tanza last Friday with an 89% space lease awarded at its two levels. Its shops will be led by the SM group’s The SM Store, SM Supermarket, Ace Hardware, SM Appliance Center, Watsons, Pet Express, Miniso, Uniqlo, Crocs, Surplus, and Banco De Oro.

The mall will house five cinemas, a Cyberzone, a food court, a carpark with around 800 slots, and public transport terminals.

SM Prime has been named Most Outstanding Real Estate Company in the Philippines by Asiamoney, an international financial publication.

For the coming week, Ms. Ulang said that SM Prime’s stock price would continue to increase.

“It will surely be rising because it has been a very resilient stock, a play on [the] Philippines’ strong consumption story even during the high inflation years,” said Ms. Ulang.

She placed the stock’s support level at P30 per share and its resistance at P32 per share. She also gave a near-term target of P35 to P36 a share.

Mr. Pangan said that with the start of the release of third-quarter earnings, optimism might ensue and “a rebound in SM Prime price prior to the release of its earnings.”

He pegged the stock’s immediate support at P30.85 while its immediate resistance at P32.45. — Lourdes O. Pilar