Quick Take: Cebu Pacific's market share and 2 more market updates
AREIT Inc [AREIT 35.90 0.1%] [link] will have 27.45% of its outstanding shares exit a mandatory lockup on Wednesday morning. The shares were issued to AREIT’s parent company, Ayala Land [ALI 28.35 1.7%] (21.79%), and to Westview Commercial Ventures Corp (2.13%) and Glensworth Development Inc (3.53%) as part of the property-for-share swap that AREIT used to purchase the Vertis North Commercial Development, Bacolod Capitol Corporate Center, Ayala Northpoint Technohub, One Evotech, and Two Evotech.
MB Quick Take: There’s only low risk here that these shares coming out of lockup will present any kind of selling pressure on AREIT’s stock price. All of these companies are within the Ayala Group orbit, so they’re not likely to be out in the open market selling shares. The shares were already “counted” long ago towards AREIT’s outstanding shares for stock pricing and dividend purposes, so this is really a non-issue as far as I’m concerned.
BPI [BPI 107.90 3.6%] [link] said that it could complete the merger with Robinsons Bank [JGS 49.50 2.6%] by October 1, 2023, which is 3 months earlier than originally projected. BPI said that the merger could even complete by July 1 if the BSP, SEC, and Philippine Competition Commission (PCC) complete their reviews and provide their approvals in time.
MB Quick Take: By all means, if there are legitimate issues, those should be identified and dealt with, but it’s a win any time that we can chop half a year off of an administrative approvals process. Regardless of whether you have skin in the game or are just a casual observer, it is better for the market and for all of us as consumers for these transactions to not be held up by red tape.
Cebu Pacific [CEB 40.25 0.4%] [link] hold 57% of the domestic flight market, which is up from the 52% marketshare that CEB enjoyed back in The Before Times (2019). CEB flew 13.5 million passengers in FY22, which is up over 300% from the previous year. CEB flew 19.7 million “seats”, both domestic and international in FY22, which is 92% of its pre-pandemic capacity.
MB Quick Take: The press release highlights the continued issue for CEB. While there has been a steep recovery, the number of flights has allowed CEB to fly 19.7 million “seats”, but only 14.8 million passengers. That means that, on average, CEB is flying planes only 75% full. Before COVID, it was flying planes 86.5% full. That’s a massive difference for a budget airline like CEB. Their entire business model relies on stuffing as many people as possible into each flight. They’re all about volume.
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Merkado Barkada's opinions are provided for informational purposes only, and should not be considered a recommendation to buy or sell any particular stock. These daily articles are not updated with new information, so each investor must do his or her own due diligence before trading, as the facts and figures in each particular article may have changed.
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