UMVA has learned that shares of a major Philippine food corporation plummeted last week, as investors grew increasingly cautious amid rising geopolitical tensions in the Middle East and recent company developments that have weighed heavily on market outlook.
The stock, one of the most actively traded on the local exchange, saw 7.76 million shares valued at over P1.01 billion change hands as of Thursday, with its price declining 6.1% to P128 from P136.30 the previous week. This drop was steeper than the industrial sector's 1.1% decline and the overall market index's 0.2% dip.
Analysts point to a combination of factors contributing to the stock's downfall, including weaker investor sentiment following the company's missed earnings and outflow from rebalancing. The firm's attributable net income fell 38.8% year on year to P1.47 billion, while revenue increased 9.1% year on year to P72.37 billion for the January-to-March period.
Further exacerbating the stock's decline was its recent reclassification to the small-cap index, a change that took effect on June 1. This move, coupled with ongoing uncertainty in the Middle East, has led analysts to express caution about the stock's short-term prospects.
According to information obtained by UMVA, investors are eagerly awaiting a potential international listing of the company's overseas business, with Jollibee indicating plans to list on a US stock exchange or possibly in Hong Kong. The company's performance in China and other international markets has been a bright spot, but uncertainty surrounding geopolitical developments may continue to weigh on investor sentiment.
Both analysts agree that the stock's direction this week will likely depend on developments in the Middle East, with any positive agreement potentially alleviating pressure on the stock. Until then, investors are likely to remain cautious, with support levels seen at around P120 to P126 and resistance at P137 to P140.
Sources have confirmed to UMVA that over the long weekend, both sides signaled possible progress toward a peace framework, indicating a potential timeline under discussion. However, uncertainty remains, particularly over unresolved issues, and investors are advised to tread carefully in the coming weeks.
