SM Prime shares rise on rosy market sentiment, expansion

SM Prime Holdings, Inc. was one of the most actively traded in the local market last week after it opened its newest mall and amid positive market sentiment.

Data from the Philippine Stock Exchange showed a total of 37.32 million shares worth P1.16 billion exchanging hands from Oct. 9 to 13, making it the sixth most actively traded stock in the local bourse last week.

Shares in the Sy-led company inched up by 1% week on week to P31.00 apiece on Friday from its P30.70 finish on Oct. 6. Year to date, the stock declined by 12.7%.

“SM Prime’s stock performance for this week was flat despite the tensions in the Middle East that transpired last weekend,” Jervin S. de Celis, equity trader at the Timson Securities, Inc., said in an e-mail, adding that the war failed to shake investor sentiment for the local bourse and the company’s stock price.

“This may have been partly due to the inflow of foreign funds into SM Prime [last] week,” he added.

Meanwhile, Globalinks Securities and Stocks, Inc. Senior Trader Mark V. Santarina said that the newly opened SM branch in Laguna marks a significant milestone in the company’s expansion.

“While it’s a promising development for the local market, it’s important to recognize that stock prices can be influenced by various factors, including broader economic conditions like inflation and interest rates, which may impact the stock’s performance,” Mr. Santarina said in a Viber message.

SM Prime opened its 84th mall in the country in San Pedro City, Laguna, making it the fourth mall in the province. The mall will open with almost 90% of space lease-awarded over three levels of shopping, dining, and entertainment hubs.

Analysts expressed optimism towards the company’s strong performance in the coming months on the back of increased consumer spending during the holiday season.

“Mall attendance is swiftly returning to pre-pandemic levels, and there is a noticeable resurgence in travel demand. These evolving consumer trends present a promising outlook for SM Prime, potentially leading to a short-term upswing in the coming months,” Mr. Santarina said.

He also said that the company’s planned market listing of its real estate investment trust (REIT) will affect the stock’s performance in the near term.

SM Prime is targeting to launch its REIT portfolio in the second half of 2024.

In the second quarter, SM Prime’s net income attributable to the parent firm grew by 49.5% to P10 billion. Its gross revenues reached P31.7 billion, 38.8% up from a year earlier.

Mr. Santarina expects the stock company’s earning to reach P10.013 billion in the third quarter and P39.5 billion for the full year.

For Mr. de Celis, SM Prime’s earning may reach P38 billion this year driven by the continued upbeat consumer sentiment.

“I expect SM Prime to continue trading above its short-term support of P30.50 while it may struggle going beyond its strong resistance level of P32,” he added.

Mr. Santarina pegged the stock’s support and resistance levels at P33 and P30.10, respectively.

SM Prime’s businesses include property and real estate, mall development and operations, office and commercial businesses, retail, as well as hotels.

Its subsidiaries include SM Development Corp., SM Hotels & Conventions Corp., SM Land, Costa del Hamilo, Inc., Tagaytay Resort Development Corp., and SM Arena Complex Corp. — Mariedel Irish U. Catilogo