I used the Wall Street Journal online's data thinking that it's more updated than that seen on COL Financial, but I missed checking out on the more direct source of data for P/E ratios - the Philippine Stock Exchange, Inc.
That's why I've created another set of tables of P/E ratios by industry collated and provided by the online PSE portal, as of August 14, 2015, midway to AuGHOST month's end wherein investors may just continue their panic buying and selling.
Most P/E ratios are somewhat similar or near the values produced by The Wall Street Journal. I decided to give data from the PSE itself to achieve balance in reporting P/E ratios. Hope that from what you may have learned in my previous post, you now know a bit how to judge stocks based on P/E ratios.
1. Bank and Financials
Comparing the P/Es of companies in the financial sector, it can be deduced that UBP is cheaper compared to its peers. However, one has to note whether there's a current problem with UBP (probably in its books or loans) or whether investors aren't just as attracted to it as they are attracted to the banking giants BDO and BPI. Or whether UBP already released its earnings report and the higher earnings reported pushed down its P/E. Or other cases. So conduct due diligence; this advise also goes to decisions involving other stocks mentioned in this post.
Election's fast approaching. Could it be the reason why ABS and GMA7 have relatively high P/E ratios? Or could it be because their earnings didn't meet expectations (if and when they already released their report)?
IMI, based on P/E, is pretty undervalued given the fact that it's operations are international; however, could this also be the reason why this stock is not priced the way it should be? Because the peso is weakening against the dollar?
PCOR, the smallest in the list of 30 blue chip companies, is on a negative P/E value. Recall that oil's price has been hardly managing to go up due to the unexpected surge in supplies internationally. EEI, on another note, is somewhat attractive, but what makes it not so catchy at all?
Again, research, research, research.
3. Conglomerates
We see here FPH (First Philippine Holdings) which has stakes in power-generating companies EDC (Energy Dev't Corp) and FGEN (First Gen Corp) as an undervalued stock. Are there problems (impending loan payments? etc?) in it or is it just not spotted?
LTG (Lucio Tan Group) has a very high P/E ratio. I don't get it why, but pretty sure one has to view this stock's trajectory. Has its earnings been affected by the Sin Tax Bill? Is it on a rebound?
4. Consumer
One of the most priced sectors is the Consumer sector, wherein average P/E hovers near 25. Most Filipinos love anything locally produced, from JFC's chickenjoy to URC's junk foods, RFM's Selecta milk and EMP's brandy. And who wouldn't love to buy in air-conditioned markets like that of PGOLD and RRHI? As long as there is someone living, these companies will continue earning. But the sector's high value?
The gaming industry has lower average P/E compared to the other sectors possibly because of lower earnings reported (MCP took a loss) which lost investors' appetite and a government crackdown on corruption in China scaring gamers in Macau. What other factors may be attributed to this lower P/E despite casino operators getting huge revenues?
6. Mining, Power, Telecom
Businesses focusing on basic needs like texting, electricity, and internet may strive despite stiffer competition. GLO's Globe is overpriced probably because investors were upbeat when the company released it has been gobbling market share and continuously earning higher profit versus its rival PLDT in this telecom duopoly.
7. Property
The property sector has a mix of undervalued and overvalued stocks. There are certain factors that influence these ratios - investor confidence, earnings report, financial stability, market share, occupancy rate, margins, scandals, etc.
Notable companies with high investor confidence are market leaders ALI and SMPH.
