PLDT Inc. experienced a significant surge in stock value last week, fueled by two key developments: the release of the implementing rules for the Konektadong Pinoy Act and the publication of its third-quarter financial results. The telecommunications giant quickly became a focal point for investors, ranking among the most actively traded stocks on the local bourse.
Trading volume reached 957,435 shares, totaling P1.17 billion between November 10th and 14th. PLDT’s share price climbed to P1,260, marking an impressive 11.5% increase from the previous Friday’s close. This performance notably outpaced both the services sector’s modest 1.5% growth and the broader Philippine Stock Exchange index’s 3% decline.
Despite the recent gains, the stock’s year-to-date performance reveals a more complex picture. It has decreased by 2.7%, lagging behind the 12% growth seen in its sector and the 14.5% drop experienced by the PSEi overall. This highlights the recent positive shift as a potential turning point for the company.
Analysts point to the Konektadong Pinoy Act’s IRR as a primary catalyst for the renewed investor confidence. The Act, designed to open up data transmission to greater competition, initially caused uncertainty among major players. However, the clarified regulations provided a clearer understanding of potential opportunities and impacts.
The law streamlines the licensing process for new companies entering the data transmission market, promising a more competitive landscape. Concerns raised by telecommunications firms, particularly regarding cybersecurity and fair competition, were directly addressed within the IRR, fostering a more stable outlook.
The IRR emphasizes transparency in pricing, requiring regular publication of updated information to ensure equitable trading practices. Furthermore, it allows data transmission industry participants to build and maintain networks without requiring a legislative franchise, encouraging infrastructure development and asset sharing.
Alongside the regulatory news, PLDT’s third-quarter earnings report also contributed to the positive momentum. While attributable net income decreased by 28.3% to P6.93 billion, this decline was largely attributed to a one-time accelerated depreciation expense related to network modernization efforts.
Revenue for the quarter reached P53.71 billion, a slight increase from the previous year, while expenses rose to P42.36 billion. Over the first nine months of the year, total revenues climbed 1.45% to P163.28 billion, despite a 10.7% decrease in attributable net income to P25.07 billion.
Despite the income decline, analysts remain optimistic, citing the company’s disciplined spending and positive free cash flow. Capital expenditures for the first nine months totaled P43 billion, a decrease from the previous year, demonstrating a commitment to financial efficiency.
PLDT is focused on reducing its net debt-to-EBITDA ratio, aiming for 2.0x from its current 2.61x. Traders predict a fourth-quarter net income of approximately P7.1 billion and a full-year net income exceeding P32 billion, signaling continued stability and potential growth.
Technical analysis suggests key support and resistance levels for the stock. Analysts place support at P1,100 and resistance at P1,300, with immediate levels at P1,240 and P1,290, respectively. These indicators provide valuable insights for investors monitoring the stock’s trajectory.
