Friday, August 31, 2012

Blue Chips Stock Selection Update



 Blue Chips Stock Portfolio
Stock
Buy Below
Current Price
Target Price
Actual Price Bought
Actual Return
BDO
60.00
61.05
81.00
-
-
ALI
18.00
22.40
22.50
-
-
PGOLD
24.00
28.50
30.00
-
-
EDC
6.00
5.98
8.50
-
-
TEL
2,400.00
2,740.00
3,000.00
-
-
AGI
11.00
11.78
15.00
-
-














In the month of ghost (Chinese calendar), stocks normally are stagnant or are being disposed off. Thus, bargain hunting is imminent because we can buy stocks at cheaper prices. Among the selected blue chips, only EDC can be bought now.

I haven’t bought anything yet actually. I’m still waiting for my documents to reach COL’s office and their approval. Once my daughter’s application is approved, I’ll start to buy the above mentioned stocks.

BDO-the banking arm of the Henry Sy companies. It successfully issued an SRO in the market boosting its capital adequacy ratio. This SRO has put the bank in a more a aggressive position to capitalize on the PPP projects.

ALI – the favorite of the foreigners. This company is being traded at premium. It has a high P/E ratio if you compare it against other real estate companies. Recently, the company has embarked on an aggressive land banking taking the FTI district from the government and negotiating with PHES for a joint venture in 60 hectares of land in Valenzuela.

PGOLD – our consumer play. It looks solid in the late twenties price level. Net income grew 32% for 1H to 1.033B pesos. It now has 134 stores operating across the country up from 100 stores last year. We remain bullish on the consumer story of the Philippines as the economy grew faster, OFW remittances growing, and inflation at a stable level. Philippines GDP is driven majority by the consumer sector.

EDC – the machines are delayed again. EDC has been experiencing credibility issue on its announcements made before regarding the motors it sent to UK for repair. Whether the generator rotors will be delivered on time remains to be seen. Nonetheless, the company earned 5.7B pesos for the 1st half 2012 while last year it incurred a loss 2.3B pesos in the same period. I believe any reduction in price from EDC below 6 is a good time buy with the benefits to be reaped in 2013 and onwards.

TEL – it’s still within the 2,700 level. Whether this price will continue at this level remains to be seen. September hasn’t been good for stocks so we will see if TEL will go down below our buy below price. Its 1H net income of 18.7B billion is on track to meet the managements 37B expected income this year.

AGI – with the current price action of AGI, it will be prudent to wait for it to go below 11. Hence, we are revising our buy below price from 12 to 11 to maximize the buying of undervalued stock. Megaworld and Emperador continue to deliver growth for the conglomerate while Travellers is in slump. Nevertheless, it is still a buy until this point. Its net income of 8.41B pesos is higher by 33% compared to last year.

Wednesday, August 29, 2012

27 firms Can Be Delisted from PSE


On the memo circulated by PSE to the investing public, firms which has less than 10% public ownership are given until December 31, 2012 to comply with the 10% public ownership rule. Failure to comply shall be subject to trading suspension of not more than 6 months.

Money+Money+Money
http://www.flickr.com/photos/73645804@N00/3019961773
Suspended firms can sell their shares but outside the PSE trading system and are subject to different taxes. Aside from this, companies must still pay listing fees while they are suspended. After the lapse of the suspension period, they will automatically be delisted from the local bourse, unless they have by then complied with the requirement.

Taxes applicable on sale of shares during suspension are different. These are:

Capital Gains Tax
·         less than 100,000 pesos net capital gains – 5%
·         more than 100,000 pesos net capital gains – 10%

Documentary Stamp Tax
·         .75 centavos on each 200 pesos of the par value of the stock

Donors Tax
·         If the fair market value of the shares of stock sold is greater than the selling price, the difference is deemed a gift and shall be subject to donor’s tax. Determining the fair value of stock shall be based on Revenue Regulations No. 6-2008.

San Miguel Firms

·         San Miguel Pure Foods Company, Inc
o   mulling delisting from the local bourse
·         San Miguel Brewery, Inc.
o   Jul 31 - It is contemplating on exiting the local bourse if its major shareholder Kirin Holdings Ltd. will not sell shares to the public.
o   Apr 2 - Mercy Marie Amador , CFO of SMB said  they plan to comply with the 10% minimum public ownership requirement of the PSE.
·         San Miguel Properties, Inc.
·         Aug 27-Ramon Ang, SMC president said they will do their best to comply. If not, they will delist

Lucio Tan-owned

·         Eton Properties Philippines Inc.
o   Is currently suspended due to the company’s failure to submit its annual report for 2011 in violation of the PSE’s revised disclosure rules. The suspension took effect in May. Micheal Tan, president of Eton said that they are considering doing a follow-on offering or delisting from the exchange. 
·         PAL Holdings Inc.
o   may conduct share sales to boost their public float levels.
·         Allied Bank 
o   Merger with PNB seen, with PNB as the surviving entity.

Roberto Ongpin-led

·         Atok Big Wedge Co. Inc.
o   Management was also authorized by the shareholders to conduct a rights or follow on offering at such terms and conditions as may be deemed beneficial to the Company by the Executive Committee of the Board of Directors in order for the Company to be able to comply with the 10% minimum public ownership requirement.
·         Alphaland Corp.
o   We will do a follow-on offering maybe in October in order to comply with the SEC regulation of 10 percent public float said Mario Oreta, President
·         Eric Recto said that the firms will strive to meet the 10% rule

Ayala-led

·         Integrated Micro-Electronics, Inc.
o   No problem hitting the 10% rule.

Others

Alaska Milk
·         It has secured the approval of its board to delist from PSE.

Cosmos Bottling
Mitsubishi+i+MiEV
http://www.flickr.com/photos/24484507@N00/3199336716
·         Is currently suspended. It is still engaged in a legal battle with the Securities and Exchange Commission on the lifting of the revocation of the registration and sale of its securities—which means it is not allowed to sell shares to meet PSE’s10-percent minimum public ownership requirement. The court war has been waging for years and it has already reached the Supreme Court.

First Metro Investment Corporation
·         mulling delisting from the local bourse

Mariwasa Siam Holdings, Inc.
Should have no problem securing the 10% minimum rule

Maybank ATR Kimeng
·         Is currently studying various alternatives as to how it will meet the PSE’s minimum public ownership requirement of 10%.

Metro Pacific Tollways
·         David Nichol, CFO of MPIC said that the company is inclined to delist as there is no immediate need to raise funds.

Pnoc Exploration Corporation
·         May conduct share sales to boost their public float levels.

Sta. Lucia Land, Inc
·         Should have no problem securing the 10% minimum rule




NAME OF STOCK
 TICKER
 FREE FLOAT %
2GO GROUP, INC.
 2GO
2.03
ALASKA MILK CORPORATION
 AMC
2.28
ALLIED BANKING CORPORATION
 ABC
1.51
ALPHALAND CORPORATION
 ALPHA
8.03
ATOK-BIG WEDGE COMPANY, INC
 AB
4.16
COSMOS BOTTLING CORPORATION
 CBC
1.79
ETON PROPERTIES PHILIPPINES, INC.
 ETON
5.65
F & J PRINCE HOLDINGS CORPORATION "B"
 FJPB
6.26
FILINVEST DEVELOPMENT CORPORATION
 FDC
3.38
FIRST METRO INVESTMENT CORPORATION
 FMIC
1.94
GLOBALPORT 900, INC
 PORT
0.12
INTEGRATED MICRO-ELECTRONICS, INC.
 IMI
9.72
JTH DAVIES HOLDINGS, INC.
 JTH
8.78
LAFARGE REPUBLIC, INC.
 LRI
3.67
MANCHESTER INTERNATIONAL HOLDINGS UNLIMITED CORP.
 MIH
6.79
MARIWASA SIAM HOLDINGS, INC.
 MMI
9.54
MAYBANK ATR KIMENG FINANCIAL CORPORATION
 MAKE
0.89
METRO PACIFIC TOLLWAYS CORPORATION
 TOL
0.15
PAL HOLDINGS, INC.
 PAL
2.3
PNOC EXPLORATION CORPORATION
 PEC
0.21
SAN MIGUEL BREWERY, INC.
 SMB
0.61
SAN MIGUEL PROPERTIES, INC.
 SMP
0.06
SAN MIGUEL PURE FOODS COMPANY, INC
 PF
0.08
SPC POWER CORPORATION
 SPC
4.53
STA. LUCIA LAND, INC
 SLI
9.95
SYNERGY GRID & DEVELOPMENT PHILS., INC.
 SGP
7.44
VIVANT CORPORATION
 VVT
4.18



Source:

Friday, August 24, 2012

Boulevard Holdings, Inc (BHI) Analysis


Boulevard Holdings, Inc. established and incorporated on July 13, 1994, is a holding company with its primary interests in the following businesses: ownership of companies involved in the development of hotels and resorts & tourism-related businesses and investments in strategic land locations & rentable real estate properties. BHI subsidiaries are significant market leaders in their respective market niches for their products, catering to premiere and elite clients to maintain relatively higher profit margins. The ambition of BHI is to expand its eminently reputable Friday’s Hotel brand to at least 9 different idyllic locations throughout Asia in the following 10 years. The company has also determined to create long term value by increasing its capitalization, entering into JV’s for tourist destination development and commanding a significant share in the primary resort home market outside Metro Manila, especially with current government decongestion efforts to improve travel time via ongoing highway construction.

The company uses fiscal year ending every May 31 for its financial results. It has goodwill in its books under Other Non Current Assets.

                              
SNAPSHOT                                                   
# of shares outstanding:
7,966,853,408
Current Price:
.147
Stockholders’ Equity
1,261,234,702
Price to Book Value Ratio
.93
Price to Book Value (Appraised) Ratio
.289
P/E Ratio
133.64
ROE
.6
ROA
.7
Free Float
41%


FINANCIAL RESULTS

2011
2010
2009
2008
2007
Revenues
144.3M
153.6M
152.4M
165M
148.2M
Cost of Services
63.9M
75.2
74M
76.9M
72.5M
Gross Profit %
56%
51%
51%
53%
51%
G & A Expenses
47.1M
49.7M
50.1M
50.5M
50.7M
Net Income/(Loss)
8.4M
4.4M
26.9M
(7.6M)
27.3M
EPS
0.0011
0.0006
0.0179
(0.0051)
0.0182
Book Value
1,191.1M
1,192.7M
303.4M
286.6M
294.2M
Book Value (Appraised)
3,833.4M
-
-
-
-
Stock Price
0.069
0.060
0.110
0.150
0.280
Book Value Per Share
0.1588
0.1590
0.2023
0.1911
0.1961
Book Value (appraised)  Per Share
0.51
-
-
-
-
P/E Ratio
62.7
100.0
6.1
(29.4)
15.4
Price to Book Value Ratio
.4
.4
.5
.8
1.4
Outstanding Shares
7,500M
7,500M
1,500M
1,500M
1,500M
Total Assets
1,386.7M
1,368.0M
441.0M
455.8M
492.8
Stockholders’ Equity
1,261.2M
1,262.9M
373.5M
286.7M
294.2M
ROA
0.6%
0.3%
6.1%
(1.7%)
5.5%
ROE
0.7%
0.3%
7.2%
(-2.7%)
9.3%



DEVELOPMENTS

AUG 15, 2012

v  One of the country’s premier conglomerates bought 4,000 hectares of land in the towns of Naic, Maragondon, Indang and Ternate Cavite. The conglomerates objective is buy 10,000 hectares to build a duty free seaport, residential and industrial district, and an airport. This will benefit BHI and Puerto Azul as long as the conglomerate does not build a power plant in Manila Bay.
v  The Cavite clans have upped their price of land from 150 to 300-350 per square meter. Some have even upped their price to 500 per square meter.
v  Mid Market Residences – will be located in flat lands.
v  Up Market Residences, coastal commercial and entertainment developments – will be constructed in Puerto Azul’s 8 kilometers prime coastal frontage.
v  Aecom, BHIs master planner went to Hongkong to evaluate further the potential of Puerto Azul over a ten year period for the first 1,100 hectares. They will be back on October to discuss the progress and meet with BHI and Jones Lang to discuss the right direction with potential JV partners.

First 1,100 Hectares of Puerto Azul

Private Owner’s Member’s Cove – beach club, tourist hotel, beach dining, condo residential, spas and hot baths, gardens, leadership and teambuilding. Target foreign investors/ repeat investors interested in expanding the upscale resort residential market.

Paniman Branded Resorts – community retail, member shares, branded villas, upscale resorts, natural attractions/farms, memberships-golf, and wedding parties. Target local developers / investors knowledgeable on the resort residential market bringing in popular local brands – premier and upper mid market. Targets families, weekenders and long-staying guests.

The Wharf -  town center, marina rde, boutique hotel, residential walkup. Targets the common Juan & Maria who will come to Puerto Azul to eat, shop, stay overnight and create a steady/ sustainable market and make PA a popular destination.
           
Palicpican People’s Cove – tour boats, water park, events/parks.

Roadside Adventures-warehouse club, bed & breakfast (b&b), roadside retail, farmers market, natural recreation, entrance to the resort, roadside market and dining. Provides overall support for the broad Puerto Azul mixed market through Bed & Breakfasts, roadside retail, nature activities, family activities, shopping and just getting out of the town.

Mountainview- themed hotel, meeting facilities, corp housing, 2nd hotmes, treetop walks/courses, wellness/retreat, study tour and culture. Exclusive 2nd home community and hotels for corporate and private functions.


JUN 27, 2012

v  Appoint Aecom Singapore Pte Ltd to provide consultancy services for Puerto Azul Master Plan Review & Update  for US$230,000.00; and Aecom Economic Analysis  for US$140,000.00
v  buy out of  Friday’s  Holdings, Inc.’s  minority stockholdings     


JUN 19, 2012

v  BHI and Cala Paniman signed a contract with Jones Lang LaSalle as marketing advisor. The contract involves the exclusive marketing of Puerto Azul properties to attract and engage qualified partners and investors who will expand and develop Puerto Azul in cooperation with, and under the terms and conditions acceptable to BHI and CPI.  This covers an area of approximately 3,000 hectares located in the municipality of Ternate, Province of Cavite, Philippines.

MAY 30, 2012

1st Growth Leg – expansion of Fridays Resort chain

v  BHI intends to buy out the 23% it doesn’t own in Fridays Bora; 2) purchase more land for Fridays Boracay;    3) probably jv or purchase a Boracay spa brand.  In all cases, Bhi will enlarge its Boracay footprint, because it predicts the destination to remain number one for some time.
v  Fridays Boquete Beach at Puerto Galera.  The property will have Phase 1 of 32 keys completed by February 2013 next year, almost 75% the size of Fridays Boracay.   It shall be the premiere hotel in that destination, just 2.5 hours drive & boat from Manila with Slex now connected to Star Toll to Batangas Ports.  Full build out is for 62 keys.  The ongoing construction is managed by British-led, LEED-certified global construction consultants, Davis Langdon & Seah (DLS).  The architects are from the Maldives, while local architectural review and full interior design is by Palafox Associates.
v  Bhi has around 55 million in cash and money market instruments, and is expected to receive from shareholders another 130 million pesos over the next few months to pay for the second Fridays hotel.  It shall keep development at USD$140,000 per key versus Asia resort average at $420,000.  So far, it has no bank debt. 

2nd Growth leg – Puerto Azul (30% stake)

v  Aecom advised BHI to concentrate in PA where the money is:  the hotel residence sales adjacent to the hotels, whether Fridays or other brand. 
v  Koreans are the mainstays of Puerto Azul’s golf related activity.
v  For the Puerto Azul job, a much bigger undertaking, Bhi shall locate two Fridays resorts within, but also draw cash  from sales of residences (built through subsidiary Cala Paniman, Inc.) to be managed by the hotels.   This is a conservative no debt, sure growth stance the way PA is located and with infrastructure going its way.  Bhi and PA could hopefully improve the outlook when the right investors finally sign up, which task Bhi soon will leave to its marketing agent.
v  Discussions with Resom are deferred until Aecom can come up a plan that can accommodate them. BHI wants all offers to be in writing. Large Korean projects have a high failure rate around Asia. Property must have varieties of hotels, residences, and activities that will cater foreigners and locals.
v  Exploratory talks on shouldering the market research costs with the proposed Cavite airport planners. Travel time will be 30 minutes only from the airport. EO 629 has an effect on this airport also.
v  The tunnel through PA to Nasugbu, Batangas is now cemented throughout and will be dried out for a tentative Presidential Ribbon cutting Aug 1 or Sept 1.
v  render marketing and financial representations in behalf of the Puerto Azul Complex valued at 13.5B over 30 years


MAR 5, 2012

v  JP Guilds subscribed to the private placement made by BHI at 100 million pesos. BHI maintains the growth policy without availment of bank debts.


FEB 16, 2012

1st Growth Leg – expansion of Fridays

v  1 Fridays Resort hotel per year
Ø  Boquete Beach, Puerto Galera (completion Nov 2012)
Ø  Paniman Beach, Puerto Azul (start Feb 2013)
Ø  Moalboal Beach, Cebu (start Feb 2014)

2nd Growth Leg - 3,000 hectare Puerto Azul

v  30% share for any business generated in the property
v  benefit from the Cavitex over the sea
v  Ternate-Nasugbu tunnel

JV structure – Jones Lang LaSalle Leechiu

v  3.5-7.25 months (meeting with potential partner to contract signing)
v  12 months (meeting with potential partner to selling of properties)

FEB 10, 2012

v  Purchase  of Cala Paniman for PhP100M payable in 7  years
v  30-year  joint venture pertaining to the 3,000 hectares Puerto Azul Complex of JP Guilds with overage share for BHI of 30%.
v  Purchase of parcels of land located in Moalboal, Cebu with 353,810 sq. m. for P707,620,000.00
v  Purchase of 729 sqm beachfront parcel of land, a building, machinery, furniture and fixtures at Sitio, Pinaungon, Barangay Balabag,  Boracay Island, Malay, Aklan at the purchase price of US$1,312,000. 

OCT 11, 2011

v  Failure of BHI to close the Resom Resorts deal is disclosed. BHI offered P4.7M per month for the developed Palicpican valley of 77 hectares. 



LANDS
   Particulars
Location
Book Value (Php)
Appraised Value (Php)
4,616 sqm @Php99,588.48
Boracay-Aklan
21,806,407
532,300,426
729 sqm @99,588.48 New
Boracay-Aklan
-
72,600,000
7,038 sqm
@Php31,700
Boracay-Aklan
33,248,156
223,104,600
4,663 sqm
@Php14,705.88
Puerto Galera
-
                68,573,518
3,743 sqm
@Php14,705.88
Puerto Galera
50,000,000
                55,044,109
1,066,012sqm
@Php1,792.56
Paniman, Cavite
900,000,000
                1,910,890,471
353,810 sqm
@phpP,500
Moalboal, Cebu
707,620,000
1,238,335,000
TOTAL
.51 per share
1,712,674,563
4,100,848,124


  
CONDOMINIUMS
Name
Particulars
Asian Mansion II Condominium
For Lease
LPL Greenhills Condominum
For Lease
Burgundy Corporate Tower
For Lease
Peak Tower Condominium
Office of BHI (Unit 1704)
TOTAL
63M Appraised Value
  

INVESTMENTS
Date
Investee
Dividends
Sep 25, 2006
Simon Murray and Associates Limited
Shares of General Enterprise Management Services Ltd. (“GEMS”) - closed ended investment company in the Cayman Island

Shares of GEMS III Limited-BVI company that manages various direct investment funds



INSIDERS TRADING ACTIVITY

Insiders are people or entities that have material non public knowledge of a company. These include directors, senior officers and entities owning more than 5% of common shares. Basically, whenever an insider is buying or selling his shares, a disclosure must be made to the PSE. Hence, we have summarized BHIs insiders trading activity and interpret the results thereof.

Date
Acquired
/Disposed
Average Selling price
Company
Owner
# of Shares
% of Ownership
# of shares owned
Aug 13, 2012
Acquired
0.1623
BHI
JP Guilds
22,470,000
55.88%
4,452,243,408
Aug 10, 2012
Acquired
0.1360
BHI
JP Guilds
360,000
55.60%
4,429,773,408
Aug 09, 2012
Acquired
0.1111
BHI
JP Guilds
2,790,000
Jul 20, 2012
Disposed
0.1337
BHI
JP Guilds
9,360,000
55.56%
4,426,623,408
Jul 18, 2012
Disposed
0.1371
BHI
JP Guilds
13,510,000
Jul 17, 2012
Disposed
0.1392
BHI
JP Guilds
14,560,000
Jul 16, 2012
Disposed
0.1400
BHI
JP Guilds
14,300,000
56.03%
4,464,053,408
Jul 13, 2012
Disposed
0.1397
BHI
JP Guilds
5,400,000
Jul 12, 2012
Disposed
0.1404
BHI
JP Guilds
5,360,000
Jul 11, 2012
Disposed
0.1410
BHI
JP Guilds
6,160,000
Jul 9, 2012
Disposed
0.1408
BHI
JP Guilds
10,910,000
56.42%
4,495,273,408
Jul 6, 2012
Disposed
0.1410
BHI
JP Guilds
10,820,000
Jul 5, 2012
Disposed
0.1409
BHI
JP Guilds
11,320,000
Jul 4, 2012
Disposed
0.1430
BHI
JP Guilds
14,130,000
56.84%
4,528,323,408
Jul 3, 2012
Disposed
0.1458
BHI
JP Guilds
9,620,000
Jul 2, 2012
Disposed
0.1441
BHI
JP Guilds
8,910,000
May 28,2012
Disposed
0.1515
BHI
JP Guilds
9,890,000
57.25%
4,560,983,408
May 24,2012
Disposed
0.1524
BHI
JP Guilds
6,620,000
May 23,2012
Disposed
0.1531
BHI
JP Guilds
4,860,000
May 17,2012
Disposed
0.1545
BHI
JP Guilds
19,780,000
57.52%
4,582,353,408
May 15,2012
Disposed
0.1557
BHI
JP Guilds
11,440,000
May 14,2012
Disposed
0.1620
BHI
JP Guilds
7,000,000
Apr 30,2012
Disposed
0.1940
BHI
JP Guilds
25,000,000
58.00%
4,620,573,408
Apr 27,2012
Disposed
0.1854
BHI
JP Guilds
28,200,000
Apr 26,2012
Disposed
0.1804
BHI
JP Guilds
16,900,000
Apr 25,2012
Disposed
0.1737
BHI
JP Guilds
29,080,000
Mar 12,2012
Acquired
0.2117
BHI
JP Guilds
9,800,000
59.24%
4,719,753,408
Mar 9,2012
Acquired
0.1839
BHI
JP Guilds
5,050,000
Mar 8,2012
Acquired
0.1761
BHI
JP Guilds
11,430,000
Mar 7,2012
Acquired
0.1764
BHI
JP Guilds
11,500,000
Mar 5, 2012
Acquired
0.2142
BHI
JP Guilds
466,853,408
58.77%
4,681,973,408
Mar 2, 2012
Acquired
0.1905
BHI
JP Guilds
8,690,000
Mar 1, 2012
Acquired
0.1896
BHI
JP Guilds
6,000,000
Feb 27, 2012
Acquired
0.1703
BHI
JP Guilds
11,340,000
56.01%
4,200,430,000
Feb 24, 2012
Acquired
0.1794
BHI
JP Guilds
2,990,000
Feb 23, 2012
Acquired
0.1839
BHI
JP Guilds
3,000,000
Feb 21, 2012
Disposed
0.1917
BHI
JP Guilds
45,880,000
55.77%
4,183,100,000
Feb 20, 2012
Disposed
0.2001
BHI
JP Guilds
33,450,000
Feb 17, 2012
Disposed
0.2016
BHI
JP Guilds
27,480,000
Feb 16, 2012
Disposed
0.2115
BHI
JP Guilds
26,900,000
57.20%
4,289,910,000
Feb 15, 2012
Acquired
0.2200
BHI
JP Guilds
17,700,000
57.56%
4,316,810,000
Feb 7,2012
Disposed
0.1650
BHI
JP Guilds
9,920,000
57.30%
4,299,110,000
Feb 3,2012
Disposed
0.1650
BHI
JP Guilds
12,540,000
Jan 12,2012
Disposed
0.1670
BHI
JP Guilds
50,000,000
57.62%
4,321,570,000
Jan 11,2012
Disposed
0.1670
BHI
JP Guilds
10,000,000
Jan 10,2012
Disposed
0.1700
BHI
JP Guilds
13,000,000
Oct 3, 2011
Acquired
0.0280
BHI
JP Guilds
6,530,000
58.59%
4,394,570,000
Sep 1,2011
Disposed
0.3950
BHI
JP Guilds
77,000,000
58.51%
4,388,040,000
Aug 26, 2011
Acquired
0.3780
BHI
JP Guilds
12,460,000
Aug 25, 2011
Acquired
0.3850
BHI
JP Guilds
28,730,000
Aug 25, 2011
Disposed
0.4200
BHI
JP Guilds
3,350,000
Aug 25, 2011
Disposed
0.4110
BHI
JP Guilds
76,650,000
Aug 16, 2011
Disposed
0.1960
BHI
JP Guilds
4,200,000
60.05%
4,503,850,000
Aug 15, 2011
Disposed
0.1890
BHI
JP Guilds
7,180,000
Aug 12, 2011
Disposed
0.1860
BHI
JP Guilds
20,000,000
Aug 5,2011
Disposed
0.1920
BHI
JP Guilds
5,000,000
60.47%
4,535,230,000
Aug 3,2011
Disposed
0.2060
BHI
JP Guilds
9,320,000
Aug 2,2011
Disposed
0.2118
BHI
JP Guilds
12,000,000
Jul 18, 2011
Disposed
0.2064
BHI
JP Guilds
28,000,000
60.82%
4,561,550,000
Jul 13,2011
Disposed
0.1490
BHI
JP Guilds
1,800,000
61.19%
4,589,550,000
Jul 13,2011
Disposed
0.1460
BHI
JP Guilds
980,000
Jul 11,2011
Disposed
0.1020
BHI
JP Guilds
105,500,000
May 9, 2012
Disposed
0.1760
BHI
M. Badiola-VP
1,010,000
-
50,000
Oct 28, 2011
Disposed
0.2200
BHI
M. Badiola-VP
1,500,000
0.014%
1,060,000
Oct 27, 2011
Disposed
0.2130
BHI
M. Badiola-VP
2,000,000
Oct 5,2011
Acquired
0.2750
BHI
M. Badiola-VP
1,000,000
0.061%
4,560,000
Oct 4,2011
Disposed
0.2650
BHI
M. Badiola-VP
4,000,000
Oct 3,2011
Acquired
0.2830
BHI
M. Badiola-VP
2,000,000
Sep 23,2011
Acquired
0.4150
BHI
M. Badiola-VP
2000,000
0.074%
5,560,000
Sep 22,2011
Disposed
0.4430
BHI
M. Badiola-VP
2,000,000
Sep 21,2011
Acquired
0.4600
BHI
M. Badiola-VP
1,000,000
Sep 21,2011
Disposed
0.4550
BHI
M. Badiola-VP
2,000,000
Sep 20,2011
Disposed
0.4720
BHI
M. Badiola-VP
3,000,000
Sep 12,2011
Acquired
0.4300
BHI
M. Badiola-VP
4,000,000
0.127%
9,560,000
Sep 1,2011
Disposed
0.4200
BHI
M. Badiola-VP
2,000,000
0.074%
5,560,000
Aug 31,2011
Disposed
0.4080
BHI
M. Badiola-VP
3,000,000
Aug 26,2011
Disposed
0.3800
BHI
M. Badiola-VP
2,000,000
Aug 25,2011
Acquired
0.3850
BHI
M. Badiola-VP
2,000,000
Aug 18,2011
Acquired
0.2660
BHI
M. Badiola-VP
3,380,000
0.141%
10,560,000
Aug 18,2011
Disposed
0.3100
BHI
M. Badiola-VP
2,000,000
Sep 23,2011
Acquired
0.4150
BHI
C. Gotanco – Treas.
1,200,000
.00016%
1,200,000

        

The insiders are active in their company shares. The VP Finance remaining shares is now 50,000 shares 
whileJP Guilds, the majority owner has been dumping shares in the market. Its ownership % of 61.19% last 
July 13, 2011 is now 55.88% as of Aug 13, 2012. Around 137M shares were disposed in the public. SB 
Securities is the broker of JP Guilds.


With the hefty sum of pesos needed for the development of Puerto Azul, I think the management are preparing for funds since it is the policy of the management to avoid bank debts.

SB Securities is the broker of JP Guilds. See the July 11, 2012 sell side of SB Securities and the disclosure made by BHI for the Jul 11, 2012 purchase of JP Guilds. They are exactly the same.

   

BIRD’S-EYE VIEW

v  2007, 2008 and 2009 are the years when Puerto Azul, Puerto Galera, Friday’s chain expansion are not yet in the picture. The current administrations focus on tourism has motivated the company to pursue expansion aggressively.

v  Revenue is stagnant for the past five years. Y2012 is expected to be the same. Y2013 is estimated to generate at least 200 million in revenues with the opening of Fridays Boquete Beach at Puerto Galera which is expected to be completed on Feb 2013. Average price of the stock is .18 for 2007, 2008, 2009 based on fiscal years closing price.

v  The P/E ratio average for 2007, 2008 and 2009 is 9.5x (other gains/losses excluded). This is the time when BHI Guilds did not issue any shares in exchange for JP Guilds land. When the Paniman, Cavite lands were acquired in exchange for 900 million pesos last Feb 9, 2010, the P/E ratio average for 2010 and 2011 became 15.6x (other gains/losses excluded). With Fridays resort chain expected to open every year starting the P/E ratio shall increased.

v  Book Value per Share is .1588. Appraised value per share of land is .51 per share. Price to Book Value ratio is .4 for 2011 and 2010 while the average for 2007, 2008 and 2009 is .9. I think the target price as far as book value play is .145 sans any development from Puerto Azul.

v  ROA average for 2007, 2008 and 2009 is 3% only. That is too low! ROE average on the other hand is 6% for 2007, 2008 and 2009. This ratios need to improve and I think the current political and economic environment will play a crucial role in it. Government’s target of foreign visitors is 10M before the president’s terms ends while Philippine economy is one of the best performing country in the world. GDP in 1Q 2012 at 6.4% is commendable.

v  The prospect of BHI given its massive land bank in Cavite is attractive. The appraised book value per share of .289 is more than 300% than what is recorded in the company’s books.

v  The insiders are active in their company shares. The VP Finance remaining shares is now 50,000 shares while JP Guilds, the majority owner has been dumping shares in the market. Its ownership % of 61.19% last July 13, 2011 is now 55.88% as of Aug 13, 2012. Around 137M shares were disposed in the public. SB Securities is the broker of JP Guilds.



THE TRADING PLAN

Buy below .11. This price is safe for short term and long term planning.

Average price of the stock is .18 for 2007, 2008, 2009 based on fiscal years closing price.

The average price to book value per share for 2007, 2008 and 2009 is .9. Calculation at .9 PBV of current book value will result in .143. It is assumed that this will be achieved in short term. With its massive land bank, the company is a book value play. The target price of .143 does not take into account the increase in P/E for the expansions of Friday’s resort chain and major developments on Puerto Azul. It is a conservative value.

Watch for any major developments for the Puerto Azul project as this will catapult BHI to its previous highs last year which is .53 which is almost equivalent to its current appraised book value of .51.

If price goes beyond target prices, ride it until the trend ends. Remember, the trend is your friend until it ends.