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Cebu Landmasters’ shares remain resilient

June 29, 2020

Shares of property firm Cebu Landmasters Inc. (CLI) remained resilient despite the coronavirus disease 2019 (Covid-19) global pandemic.

CLI’s shares finished 0.47 percent better to P4.30 apiece last week, improving its week-on-week performance by 6.17 percent.

Philstocks Financial Inc. research associate Piper Chaucer Tan said the company’s resilience in terms of its earnings, along with steady residential lot prices and appetite for residential home, heavily influenced CLI’s shares.

While CLI’s first quarter net income shed 8 percent to P648.5 million from P701.6 million, its consolidated revenues jumped 13 percent to P2.1 billion from P1.87 billion year-on-year.

The property developer also recently disclosed its strong first half reservation sales, which rose by 20 percent to P6.2 billion from P5.2 billion in the same period last year.

Tan said prices of residential houses and lots in the Visayas and Mindanao have been on their pre-Covid-19 levels, unlike in Luzon, where analysts estimate prices to drop by almost 20 percent because of the pandemic.

“The driver for growth for CLI has been (its) mid-market and economic segment, Casa Mira. This brand is placed strategic(ally) in places in (the) VisMin region, which we think CLI has a great advantage in terms of its sales and marketing,” he added.

CLI said it has sold P3.4-billion worth of homes or over 1,500 housing units for its economic and mid-market buyers in the second quarter.

“Our projects maintain high sales velocity and demand for houses in Visayas and Mindanao (VisMin) continues as having a home has become a priority,” CLI Chief Executive Officer Jose Soberano was quoted as saying in a previous statement.

Meanwhile, as the number of confirmed Covid-19 cases in Cebu continues to rise, Tan noted that CLI’s operations and geographic revenue path is not just from Cebu but in other key VisMin cities, including Bacolod, Iloilo and Davao, among others.

“What is interesting in CLI is that most of its land bank is outside Cebu and in key and emerging cities in VisMin,” Tan said.

As for the movement of CLI’s shares this week, Tan placed support at P4.15 and secondary support at P4, while primary resistance is at P4.40 and secondary resistance at P5.

“I think the movement for CLI will be gradual and liquidity issues will [be] brought down to the table, as well, but I think in terms of valuation and getting the value in investing in CLI, I think it is a good bet,” Tan noted.

He added that the volume for CLI’s shares surpassed the 20-day moving average of 1.29 million shares to averaging 2.5 million since June 19.

“Sustained core earnings and continued demand from the residential sector will boost the sentiment for CLI, (as well as) maintaining good credit standing and leverage ratios,” Tan remarked. – by Faye Almazan

Published in Manila Times