PSEi seen to recover to 7,600 by mid-2023
Stock brokerage house Maybank Securities Inc. sees upside for patient investors willing to make strategic bets despite the bearish sentiment in the stock market.
Maybank Securities’ head of research strategy Jacqui de Jesus said business fundamentals were intact, with corporate earnings forecast to grow by double digits this year until 2023 with the further reopening of the economy.
“There is a bit of fear, which is understandable [especially] because the issues are external,” she told the Inquirer in a recent interview.
Nevertheless, investors could still reap returns as the stock analyst is forecasting the Philippine Stock Exchange Index to recover to 7,600 over the next 12 months, or by mid-2023.
This implies an upside of about 28 percent for the index, which has lost 17 percent since the start of 2022 and entered a bear market in late September.
De Jesus said corporate earnings were expected to grow 14 percent this year and 16 percent in 2023 while major drivers would be the property and banking sectors.
“For banks, it’s the normalization of provisions [while] loans would grow 10-12 percent,” she said.
Top picks
Property stocks are also seen to benefit without the disruptions earlier caused by pandemic restrictions and the return of foot traffic in shopping malls.
De Jesus also observed there was minimal risk of property defaults as banks were absorbing recent interest rate hikes by the Bangko Sentral ng Pilipinas.
“Because every one of [the banks] is wanting that part of the business because of its high margins, we haven’t seen the hikes translate to mortgages moving up,” she explained.
De Jesus said SM Investments Corp. was their top consumer stock, with a 12-month price target of P1,090 per share, while DMCI Holdings Inc., whose assets span commodities, power and construction, had a price target of P12.15.
Other picks are BDO Unibank, with a target price of P150, real estate investment trust firm AREIT Inc., with a target price of P48.50 and PLDT Inc., which has a target price of P2,275 per share.
International Container Terminal Services Inc. has a target price of P223 while Bloomberry Resorts Corp. has a target price of P10 per share. •INQ••
