Jollibee shares fall despite investment expansion

SHARES in the Tony Tan Caktiong-led food company fell last week due to overall negative sentiments amid investment expansion in a private equity fund that owns the Tim Ho Wan brand.

Data from the Philippine Stock Exchange showed a total of 6.68 million shares worth P1.61 billion were traded from April 1 to 5, making Jollibee Foods Corp. (JFC)  the fourth most active stock in the local market last week.

Shares in JFC dropped by 8.9% week on week, with the stock finishing at P230 per share from its closing of P252.60 on March 27.

Year to date, the stock’s price has also decreased by 8.5%.

Mark V. Santarina, senior trader at Globalinks Securities and Stocks, Inc., attributed the decline to heavy foreign selling.

“I think this is due to overall negative sentiment since the market is sensitive to any indicators hinting at impending inflationary pressure especially that JFC is a consumer stock,” Mr. Santarina said in a Viber message.

Inflation in March increased to 3.7% year on year from 3.4% in February, making it the fourth straight month that inflation settled within the Bangko Sentral ng Pilipinas’ 2-4% target range.

Meanwhile, Philstocks Financial, Inc. Research and Engagement Officer Mikhail Philippe Q. Plopenio said consumers are wary of the company despite its additional investment in Titan Dining Partners Ltd.

“Following its subsidiary’s increased participating stake in Titan Fund II, investors seem to be cautious given that JFC’s overseas acquisitions have not performed well immediately. Concerns regarding its acquisition and participation in foreign quick-service restaurants could be the reason why investors sold shares of the stock,” he said in an e-mail.

The Caktiong-led food company announced in a disclosure last week an additional capital investment in Titan Dining II LP, amounting to S$90 million.

“The fund… will be used (for) strategic investments in food and beverage concepts with the objective to further grow Asia-Pacific food service brands and/or bring strong global food service brands to Asia-Pacific,” JFC said.

Titan Dining LP is a private equity fund that owns the Tim Ho Wan brand.

Mr. Santarina expressed optimism towards the stock company based on its robust earnings report but also noted for investors to observe economic indicators.

“If you’re thinking of investing, be cautious during the current downtrend. Waiting for a consolidation phase before buying JFC might be a smart move,” he added.

JFC’s attributable net income in 2023 amounted to P8.77 billion, up by 16% from P7.56 billion in 2022.

Its revenues increased by 13.3% to P246.55 billion in 2023 from P217.58 billion previously.

Mr. Santarina expects the company to record its first-quarter net income at P2.44 billion and P9.97 billion for the full year.

For the week, he pegged the stock’s support at P215, while resistance was at P254.

Mr. Plopenio placed the support level at P220.80 and the resistance at P240.

As of the end of February, JFC has 6,902 stores worldwide, with 3,336 of them located in the Philippines. — Mariedel Irish U. Catilogo