Banks, index stocks recommended

Amid heightened volatility in the stock market, analysts recommend bargain hunting on index heavyweights and banking stocks as they maintain their positive long-term outlook for both the Philippine economy and the equities market.

Abacus Securities Corporation is recommending a buy on San Miguel Pure Foods Company because of its consolidation with San Miguel’s beer and liquor business and that “the recent drop below is a good opportunity to buy for a medium-term hold.”

It is also bullish in the long term for banks and “those with a focus on retail banking and consumer finance (EastWest Bank, Security Bank) should do better than their peers because the growth in demand for car, housing and salary loans will outpace that for commercial loans.”

Abacus is also recommending investors to hold or buy MacroAsia when its price dips because of its strong earnings forecast.

COL Financial Vice President and Head of Research April Lynn Tan maintains her recommendation for Ayala Corporation, Ayala Land, Aboitiz Power, Semirara Mining, Metrobank, and Megaworld because these have fallen further below their buy levels.

Papa Securities trader Gio Perez said that, “at a level below 8,000, the index is trading at attractive valuations which may prompt bargain buying again. Month-end and quarter-end window-dressing activities may provide lift to the index next week. We recommend to Buy on Weakness with support level at 7,800.”

Online brokerage 2TradeAsia.com recommended that investors “ride this ‘cyclical wave’ that usually presents buying opportunities for contrarians. Hunt for oversold stocks with solid fundamentals.”

However, it noted that, “limited movement may ensue this week, as fund managers prepare for the Lenten break.”