SHARES of Converge ICT Solutions, Inc. went up last week, buoyed by the upbeat 2024 earnings report.
Data from the Philippine Stock Exchange (PSE) showed that Converge was the fifth most traded stock this week, with a value turnover hitting P511.34 million from a total of 27.48 million shares traded from April 14 to April 16.
Financial markets were closed on Thursday and Friday in observance of Holy Week holidays.
The information technology giant’s shares rose 8.7% week on week to P19.48 on Wednesday, better than the 0.7% posted by the services index and the 0.9% of the PSE index (PSEi).
Year to date, Converge shares also grew by 20.7%. This was also significantly higher than the performances of services sector (-7.4%) as well as PSEi (-6%).
Its earnings report played a big role in Converge’s stock performance recently, analysts said.
“However, I believe this trend or improvement [last] week was just an extension of its rally which started on the release of CNVRG’s earnings on March 17,” Luis A. Limlingan, head of sales at Regina Capital Development Corp., said in a Viber message, referring to the company’s ticker symbol.
“While several global headwinds affected its price, current movement shows it’s trending back to previous levels,” he added.
For his part, Jeff Radley C. See, head trader at Mercantile Securities Corp., said that investors continue to stay bullish as the company continues to expand.
Converge’s attributable net income climbed by 18.8% to P10.81 billion last year from P9.1 billion in 2023, its latest audited financial report disclosed to the local bourse showed.
Its consolidated revenues reached P40.61 billion, 14.8% higher than P35.36 billion posted in 2023.
Mr. See said that the company has been expanding in terms of enterprise through partnerships including that with Elon Musk’s Starlink.
On March 26, Converge confirmed that reselling Starlink will be part of the company’s guidelines for fiscal year 2025 — a move through which it looks to grow consolidated revenues by 14%–16% this year.
This partnership has already been in the works since 2021 with Converge looking to accommodate SpaceX’s potential broadband satellite venture to Southeast Asia at the time, Reuters reported.
Mr. Limlingan added that the upward trend in Converge shares was only paused due to global headwinds related to US President Donald J. Trump’s recent announcement of base level and reciprocal tariffs for all countries exporting to the US on April 4.
Selling was induced as investors braced for more international uncertainties in the future, he added.
Trading days after the announcement of Mr. Trump’s new trade policy saw Converge shares steadily falling from P18.76 closing levels on April 4, even closing at P17.80 on April 8.
“Converge’s price was already trading above P18 level and only fell on global noise/headwinds that affected the broader market,” he said.
Despite this, last week’s growth in price per share just showed a return of the trend seen before global headwinds, he added.
Both analysts were optimistic about Converge’s performance in the upcoming trading days.
Mr. See predicts that investors’ bullish sentiments will persist as the company continues making moves to expand.
“The stock would try again to break the strong resistance between P19-P19.30 next week,” he said in a separate Viber message.
Mr. Limlingan added that consolidation at its current levels “won’t be surprising” as the stock’s price approaches its 52-week high.
However, he said that a pullback may be possible with the stock’s consecutive 3-4% hike.
Mr. See pegged strong resistance and support levels between P19 to P19.30 and P17 and P15.50, respectively.
Meanwhile, Mr. Limlingan pegged a resistance level at P20 and support at around P19 and P18.70.— Matthew Miguel L. Castillo
