For my first company report, I am taking a look at GT Capital Holdings Inc [PHS:GTCAP] a Philippines-based company engaged in banking, automotive assembly, importation, distribution and financing, property development, life and non-life insurance services, GT Capital has a MarketCap of PHP102bn and has traded between PHP380 and PHP550 over the 52 week range, with shares currently trading at PHP495.
GT Capital Holdings: The technical view
As of late December, we’ve seen a notable shift in the share price trend, indicating a bullish investor sentiment. At present, shares are trading above the 200-day moving average, having previously dipped below it during a retracement to the 0.5% Fibonacci level as you will see in the graph below. Following the recent earnings report, this bullish momentum has been reignited, suggesting the possibility of the stock reclaiming its February highs.
The fundamental view
Looking at the fundamentals of GT Capital, the overall outlook reveals a greater number of positive factors right now. The business is currently trading at an attractive valuation compared to both its industry peers and the overall market. Additionally, its earnings have experienced substantial growth, with an impressive 71% increase over the past year. Looking ahead, analysts anticipate a yearly growth rate of 11% for the next three years.
The price-to-earnings ratio is worth highlighting too. It stands at 5.8x which is notably lower than the average price-to-earnings ratio of the Philippine market, which is around 12x.
There is just one significant negative factor that I should highlight. GT Capital’s debt is not adequately covered by their operating cash flow, which poses a concern.
