BDO Unibank, Inc.

THE SY-LED BDO Unibank, Inc. was one of the most actively traded stocks last week as market players reacted to its flat first-half earnings report.

A total of P1.896 billion worth of 14.149 million BDO shares exchanged hands on the trading floor from July 30 to Aug. 3, data from the Philippine Stock Exchange showed.

On a week-on-week basis, its share price was lower by 0.15% to P136.80 last Friday from its July 27 closing price of P137 apiece. Year-to-date, the bank’s share price was down by 16.59%.

“The activity [last week] on BDO was driven mainly by the earnings result,” said Rachelle C. Cruz, research analyst at AP Securities, Inc., in a phone interview last Friday.

“The market was looking at [BDO’s] core earnings rather than earnings that has been affected by — not one-time but more of especially — non-recurring gains or non-interest income,” she added.

Based on its unaudited consolidated financial statements disclosed to the bourse, BDO’s net interest income rose by almost a fifth to P45.975 billion in the first semester from P38.616 billion last year.

Its net income for the period was at P13.113 billion amid “solid” results of its core lending and deposit-taking businesses. This figure, however, was down by 1.26% from P13.281 billion a year ago.

In a statement, BDO said its earnings for the six months to June “would have increased by 13%” had it not been due to the implementation of a new accounting standard (Philippine Financial Reporting Standards 9) on the investment portfolio of its insurance unit BDO Life Assurance Co., Inc. and the ongoing expansion of its rural banking arm One Network Bank, Inc.

Justino B. Calaycay, Jr., head of research at Philstocks Financial, Inc., said BDO, as well as other listed banks, might pick up in the latter half of the year as this is where spending levels tend to go up.

“Hopefully they should be able to post high single digits or even in the low double digits [by yearend],” he said in a separate phone interview.

For her part, AP Securities’ Ms. Cruz expects BDO to take in P31.7 billion in net income this year against the bank’s P31-billion profit guidance for 2018.

For this week, AP Securities’ Ms. Cruz said the focus will be on other companies that will report second-quarter figures, hence BDO’s value turnover will experience “some sort of tapering.”

AP Securities gave BDO a price support ranging from P129.50 to P134.80 and a resistance P142.50 to P146.10.

Philstocks’ Mr. Calaycay, on the other hand, pegged a support for BDO at P128 to P132 and a resistance at P137.50 to P140.

“If the earnings pick up, we see a push towards P147 to P150 levels for BDO,” he said.