First Metro Asset Management Inc

The Bellwether – Issue 27

Releasing the 27th issue of The Bellwether, as published by FMIC’s IAG-Research.

This is a fortnightly publication on market action and outlook.

The following are the highlights of the issue:

Emerging markets skid on a money flow reversal; End of easy money?

Globe Telecom, Inc. (GLO) and ABS-CBN Corporation (ABS) leapfrog to media convergence

Metro Pacific Investments Corporation’s (MPI) dividends rises to 25% (of current year’s income) in 2015; Sees Php7.5bn – Php7.7bn 2013 earnings

Emerging markets skid on a money flow reversal; End of easy money?

 

Money flow reversal

 

Overseas investors have pulled a record $2.7bn from Thai, Indonesian and Philippine stock markets this month (as of June 14, 2013), the biggest eight-day outflow since 1999, according to Bloomberg. Not the first time US policy easing reversal and strengthening dollar have thrown emerging markets into a money flow reversal, noted well-known economist and Bank of Israel Gov. Stanley Fischer.

 

 

 

Globe Telecom, Inc. (GLO) and ABS-CBN Corporation (ABS) leapfrog to media convergence

 

Ahead of PLDT?

 

Globe may have gone ahead of PLDT’s media convergence strategy that has failed to take off with the hemorrhaging TV5. Globe is earning carriage fees (estimate and structure of economic benefit sharing still undisclosed) from ABS CBN Convergence Inc., a newly formed telecommunications (telco) subsidiary of media outfit and 60.3% Lopez Inc.-owned ABC-CBN Broadcasting. The convergence sub is riding on Globe’s upgraded Long-term Evolution technology (LTE)-powered mobile network infrastructure as it attempts to market its own brand of prepaid and postpaid SIMs, handsets/smartphones, and generate advertising revenues from these. The selling point of these ABS-CBN Convergence’s branded mobile gadgets and SIM connection is that through them ABS-CBN programs/content can be exclusively accessed. 

 

 

 

 

 

Metro Pacific Investments Corporation’s (MPI) dividends rises to 25% (of current year’s income) in 2015; Sees Php7.5bn – Php7.7bn 2013 earnings

 

Rising income, rising dividends

 

With MPI’s net income rising (up +28% to Php6.5bn in 2012), so are its dividends. The 1Q2013 core earnings were up 23% to Php1.9bn year-on-year (yoy) and may reach Php7.5bn – Php7.7bn for the entire 2013, an 18% growth yoy. MPI announced an increase of dividend payout to 25% by 2015 from the current 13% (based on current year’s income as opposed to previous year). It is also deferring a reverse stock split plan, keeping the capital structure intact, as the stock forms part of the MSCI Global Standard Indices come May 31. Dividend payout may be 18% next year and more tempered in 2016 when Maynilad loses its tax holiday, over which MPI will work out a scheme to at least secure a rate lower tax than the 30% to a likely 18%.

 

 

 

 

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Doubling of Daily Output in 2014.

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