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JG SUMMIT HOLDINGS INCO.

PHP 62.50
Industry: Food & Beverage Analysis of 06-Jun-2020
Sector: Food Products Closing price of 05-Jun-2020

JG SUMMIT HOLDINGS INCO. sees an upgrade to slightly positive due to a

better fundamental star rating

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Food & Beverage - Food Products

JG SUMMIT HOLDINGS INCO.

PHY444251177 | JGS | Philippines Analysis of 06-Jun-2020 Closing Price of 05-Jun-2020 PHP 62.50

JG SUMMIT HOLDINGS INCO. active in the sector Food Products, Global Evaluation
belongs to the industry group Food & Beverage.

Its market capitalization of USD 9.00 bn. ranks it among large-cap stocks.

Since June 4, 2019 this stock has reached a high of PHP 82.00 and a low
of PHP 43.35; its current price of PHP 62.50 places it 23.8% under its 52
week high and 44.2% over its 52 week low.

Performance since June 4, 2019: JG SUMMIT HOLDINGS INCO.: 0.0%,

Food & Beverage: 21.3%, PSE: -18.6%
Negative Slightly Neutral Slightly Positive
negative positive

Company Name Price Perf Mkt Cap Stars Sensitivity LT LT Div 4wk Rel Global
YtD in $bn P/E Growth Perf Evaluation

JG SUMMIT HOLDINGS INCO. 62.50 -22.7% 9.00 19.5 18.6% 0.4% 11.0%

Food & Beverage (PA) 550.00 6.2% 1,072.71 19.0 18.1% 2.0% 0.4%

PSE 6,465.00 -17.3% 163.54 13.8 12.1% 2.0% 14.0%

The four-week relative performance against the reference index PSE is 11.0%.
Comparison June 4, 2019 - June 5, 2020 The technical trend is also positive, which validates this overperformance and
confirms the investors' interest in this stock.
The four-week relative performance of its reference group Food & Beverage is
positive.
30%

Dividend
15%
The 12-month indicated dividend yield is 0.4%. This estimated dividend
represents 8.6% of the estimated earnings. Consequently, the dividend is easily
0%
covered, and very likely to prove sustainable.
-15%

-30%
Summary of the Fundamental and Technical Analysis
1. The negative earnings revisions trend is specific to the stock.
-45%
Aug-19 Oct-19 Dec-19 Feb-20 Apr-20 Jun-20 2. In terms of valuation, the stock has very good potential.
JGS PSE FOB@PA
3. The technical trend is positive in a positive environment.
4. Both the stock and the environment Food & Beverage have outperformed
the market over the last four weeks.

Fundamental and Technical Analysis

Price Level Analysis
Checklist
In order to assess whether JG SUMMIT HOLDINGS INCO. is currently fairly Global Evaluation Upgrade from neutral to slightly positive
priced, we can combine Peter Lynch's broadly accepted methodology, comparing the 05-Jun-2020.
the projected earnings growth and dividends to the estimated PE ratio, with
Interest Strong interest since 05-Jun-2020.
historic multiples. Based on this,
- JG SUMMIT HOLDINGS INCO. appears fundamentally very undervalued Earnings Rev Trend Analysts negative since 04-Feb-2020
compared to its theoretical fair price.
- its valuation is comparable to the Pacific Food & Beverage aggregate. Valuation Rating Strongly undervalued
The fundamental price potential for JG SUMMIT HOLDINGS INCO. looks good,
MT Tech Trend Trend positive since 02-Jun-2020
and in line with the average of its industry group.
4wk Rel Perf vs. PSE
Earnings Revisions
JG SUMMIT HOLDINGS INCO. is weakly followed by financial analysts, as Sensitivity Increase from low to moderate the 07-
over the last three months an average of 5 analysts provided earnings estimate Jan-2020.
forecasts up until the year 2022.
Currently, these analysts are negatively revising their earnings growth estimates
(-15.3%) compared with seven weeks ago. This negative pressure acts slightly
in counterweight to the positive technical trend.
The positioning of JG SUMMIT HOLDINGS INCO. vs. its reference sector Food
& Beverage accentuates that the clearly negative trend of earnings revisions is
a problem specific to the stock, because its environment is - on the contrary -
being positively revised.

Technical Trend and relative Performance

The stock has been in a medium-term up trend, which started on June 2, 2020,
at a price of PHP 53.95. Its adjusted technical reverse point is PHP 50.44, or
19.3% under the current price.

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JG SUMMIT HOLDINGS INCO. - Sector and/or Group Comparison

Company Name Symbol Market Price Perf Mkt Cap Stars Sensitivity LT LT Div Global
YtD in $bn P/E Growth Evaluation

JG SUMMIT HOLDINGS INCO. JGS PH 62.50 -22.7% 9.00 19.5 18.6% 0.4%

SMGL.FDBV.INCO. FB PH 70.00 -17.7% 8.93 24.8 14.7% 1.9%

UNIVERSAL ROBINA CORP. URC PH 134.00 -7.6% 5.94 22.0 15.4% 2.3%

EMPERADOR INCO. EMP PH 7.90 9.6% 2.53 17.4 20.1% 2.0%

NESTLE AG NESN CH 102.60 -2.1% 317.25 21.3 13.4% 2.6%

MONDELEZ INTL.INCO. MDLZ US 52.53 -4.6% 74.98 18.6 12.7% 2.2%

FOSHAN HAI TIAN FLFD. 603288 CN 115.37 28.8% 52.75 36.2 27.2% 1.2%

DANONE BN FR 63.50 -14.1% 49.29 15.8 10.4% 3.1%

KRAFT HEINZ CO. KHC US 32.62 1.5% 39.86 13.1 5.5% 5.0%

GEN.MILLS INCO. GIS US 61.00 13.9% 36.97 16.7 8.9% 3.3%

HORMEL FOODS CORP. HRL US 48.00 6.4% 25.87 23.8 15.9% 2.0%

Price & Sensitivity Evolution Sensitivity Profile

90 Bear Market Factor

80

Bad News Factor

70

60
1 month volatility
50

40
Aug-19 Oct-19 Dec-19 Feb-20 Apr-20 Jun-20 12 months volatility

Share Price MT Technical Trend

Beta

Aug-19 Oct-19 Dec-19 Feb-20 Apr-20 Jun-20

Low Moderate High

JGS PSE PSE (Average stocks)

Sensitivity Analysis
Beta, Correlation and Volatility
Beta is often used as a measure of sensitivity. Where a Beta is greater than 100,
the stock is more volatile and therefore more sensitive. A Beta of 1.35 indicates
that for 1% of index variation, JG SUMMIT HOLDINGS INCO. varies on average
by 1.35%. But a Beta analysis coupled with the correlation gives a more relevant
assessment.
Conclusion
At the analysis date of June 5, 2020, the impression that the fundamental
and technical elements (valuation, earnings revisions, group benchmarking,
technical factors) give is positive.
Moreover, the combination of the different criteria of sensitivity appreciation
leads to a qualification of medium sensitive.

Correlation is the degree of similarity in which a stock fluctuates in relation to By combining the positive fundamental and technical analysis, with the
its reference index. JG SUMMIT HOLDINGS INCO. has a correlation rate of moderate sensitivity, the general evaluation seems slightly positive.
0.84. This indicates that 84% of the stock's movements are explained by index
variations. JG SUMMIT HOLDINGS INCO. is strongly correlated to PSE.

The volatility is also used as a sensitivity factor. The 1 month annualized volatility
of JG SUMMIT HOLDINGS INCO. is : 67.3%, that of the index PSE is 33.7%
Key Figures
and that of the world aggregate for the group Food & Beverage is 15.3%. By Annualized estimate for current year to 2022
comparison, the average volatility of the stocks that make up the reference index
is slightly lower at 50.8%. Estimated PE (LT PE) for 2022 19.5

Sensitivity to Bear Markets Projected earnings growth (LT Growth) 18.6%

The Bear Market Factor measures the behavior of a stock in declining markets.
Dividend (Ex Date: 08-Jun-2020) PHP 0.38
Thereby JG SUMMIT HOLDINGS INCO. tends to drop in the same proportion
as the PSE index. Hence, we observe a market typical behaviour during market Number of analysts 5
declines.
First analysis date 26-Apr-2019
Sensitivity to Bad News
The Bad News Factor measures negative swings of a stock in rising markets. In
the case of specific pressure, JG SUMMIT HOLDINGS INCO. is only moderately
sanctioned by the market in most of the times. When the stock goes down in a
rising environment, its average deviation is -2.00%.

Summary of the Sensitivity Analysis

By comparing with other stocks, the sensitivity of JG SUMMIT HOLDINGS INCO.
has been medium and this since January 7, 2020.

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JG SUMMIT HOLDINGS INCO. - Historical graphs since April 26, 2019 **

Price Changes April 26, 2019 - June 5, 2020 Expected Dividend Yield 2019 - 2020

105 2.5%

90 2.0%

1.5%
75

1.0%
60

0.5%
45

0.0%
30 2019 2020
Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20

Share Price Volatility channel JGS FOB@PA

The volatility channel shows a stock's average fluctuations since April 26, 2019 **.
During this period, the high of PHP 82.00 was reached on January 2020 and the
low of PHP 43.35 in the month of March 2020.
The price development is generally in the volatility channel whose upper and
lower limits are presented here. Crossing one of these limits is an exceptional
situation accompanied by strong increases in short-term volatility.
The 12-month indicative dividend yield is 0.4%, less than the 2.0% average of
the industry group of JG SUMMIT HOLDINGS INCO..
Reminder, this estimated dividend represents 8.6% of the estimated earnings. It
is thus largely covered, and its payment looks very sustainable.

Comparative LTPE April 26, 2019 - June 5, 2020 Performance vs Volatility

20.0
603288

30%
17.5

HRL GIS
15% KHC
15.0
NESN EMP
0% MDLZ JGS

12.5
BN
-15%
URC
10.0
-30%
FB
7.5
Jun-19 Aug-19 Oct-19 Dec-19 Feb-20 Apr-20 Jun-20 -45%
20% 25% 30% 35% 40% 45%
JGS FOB@PA Median

The forward PE of JG SUMMIT HOLDINGS INCO. is close to that of its group
Food & Beverage, as it currently stands at 19.49 and the group’s forward PE is
19.03. This indicates the stock’s valuation is not far from that of its industry group.
Historically speaking, this stock is also currently trading at a premium, because
its median is 15.22.
The vertical axis measures the performance since the first analysis date June 4,
2019 of the 10 stocks presented in the table on page 2, while the horizontal axis
measures the 12 month annualized volatility.
The bubbles are sized according to market capitalization, and their colors indicate
the overall rating (Global Valuation).

Comparison April 26, 2019 - June 5, 2020

-23% -17% 6%
30%

15%

0%

-15%

-30%

-45%
Apr-19 Jul-19 Oct-19 Jan-20 Apr-20 Jul-20 Oct-20

JGS PSE FOB@PA

Since April 26, 2019, the performance of the stock JG SUMMIT HOLDINGS INCO. is -3.3%, vs. -17.8% for the PSE and 18.0% for the group Food & Beverage
(FOB@PA).

**The stock is followed by theScreener since April 26, 2019. The historical graphs are shorter than the usual period of 5 years.

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JG SUMMIT HOLDINGS INCO. - Financial Ratios 2019

Return on Equity Earnings Before Interest & Taxes

12.5% 20%

10.0%
15%

7.5%
10%
5.0%

5%
2.5%

0.0% 0%
2015 2016 2017 2018 2019 2015 2016 2017 2018 2019

JGS FOB@PA JGS FOB@PA

The return on equity, or ratio between profits and available equity, varies greatly
from industry to industry. The historical average return on equity of JG SUMMIT
HOLDINGS INCO. is 9%. This is below the industry average of 11%, indicating
a moderately efficient use of shareholder capital.
The last publicized return on equity of 10% is located near the long-term average
of 9%.
The average historical operating margin (EBIT) of JG SUMMIT HOLDINGS
INCO. has been at 15%. This is above the industry average. The competitors
achieved an on average EBIT margin of 10%.
The last reported 17% are near the historical average of 15%.

Equity on Assets Book Value / Price

60% 75%

60%
45%

45%
30%
30%

15%
15%

0% 0%
2015 2016 2017 2018 2019 2015 2016 2017 2018 2019

JGS FOB@PA JGS FOB@PA

The graph shows the share of own funds in relation to the total assets. The
higher the value, the more conservative the company's finances. JG SUMMIT
HOLDINGS INCO. has an average equity ratio of 35%, which is below the
industry average of 55%.
The current capital share of 33% is close to the historical average of 35%.
The book value of the company is shown in relation to the stock's value. The
larger the ratio, the more asset value is obtained relative to the market price. The
average value of JG SUMMIT HOLDINGS INCO. is with 53% above the industry
average of 42%.
With 53% the current value is close to the historical average of 53%.

Balance Sheet 2017 2018 2019 Annual Statement 2017 2018 2019
31-Dec 31-Dec 31-Dec 31-Dec 31-Dec 31-Dec
Currency 'mio PHP PHP PHP Currency 'mio PHP PHP PHP
Cash & Short Term Invest 90,177 84,375 93,521 10% Total Revenue 262,085 280,507 287,116 100%
Receivables 54,418 56,245 61,807 7% 59%
Cost 159,699 179,603 169,029
Inventories 53,717 64,214 69,247 7% 30%
Gross Income 86,817 84,171 87,495
Total Current Assets 206,716 214,305 234,156 25%
General Cost & Administration 40,621 42,571 39,403 14%
Properties & Equipment 182,158 218,640 279,998 30% 11%
Amortization 15,568 16,733 30,592
Intangible 46,044 45,960 45,904 5% 16%
Operating Income 44,798 39,795 46,215
Total Assets 738,011 817,322 925,847 100%
Research & Development 83 87 87 0%
Net Income Before Extra Items 29,370 19,186 31,285 11%
Account Payable 22,950 30,422 33,910 4%
Net Income Before Taxes 43,874 34,424 48,355 17%
Short Term Debt 51,576 66,416 66,651 7%
Dividend 2,000 2,100 2,700 1%
Total Current Liabilities 181,680 229,419 245,139 26%
Net Income 29,358 19,174 31,270 11%

Long Term Debt 175,958 201,004 227,437 25%

Total Liabilities 738,011 817,322 925,847 100%

Key Figures Ratios

Book Value 37.39 38.61 42.55 Current Ratio 1.1 0.9 1.0
Shares Outstanding ('000) 7,162,842 7,162,842 7,162,842 Long Term Debt 23.8% 24.6% 24.6%
NB of Employees 22,894 23,942 26,158 Revenues on Assets 35.5% 34.3% 31.0%
Cash Flow on Revenues 17.1% 12.8% 21.5%

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Glossary - Equities

Global Evaluation ago, the analysts have now revised and raised their estimates by 2.8%. On the contrary, a
negative number means that the earnings would have been revised lower.
The rating results from several factors : fundamental and technical analysis, measure of
sensitivity and benchmark trend. G/PE Ratio
The synthesis is rated on a 5 level scale: In order to establish our Valuation Rating, we calculate the estimated growth of future earnings
- (LT Growth) plus dividend in %, divided by the estimated future PE ratio (Long Term P/E).
: Positive
LT PE
-
: Slightly positive This is the relationship between the price (P) and the estimated long-term future earnings.
- LT Growth
: Neutral
This is the estimated annual growth rate of future earnings, normally projected over the next
-
: Slightly negative two to three years.
- MT Tech Trend
: Negative
The synthesis for the Indices and Industries is rated on a 3 level scale: Positive, Neutral and The MT Tech Trend indicates the current trend, positive or negative , and the Tech
Negative. Reverse indicates up to which price this trend will remain valid.
When a price falls to 1.75% above or below the Tech Reverse, the MT Tech Trend is
Number of Stocks
considered neutral .
The number of stocks in the index that can be analyzed.
Once the price breaks out of the +1.75% neutral zone, the MT Tech Trend will change to
Mkt Cap in $bn positive.
This number represents the Market Capitalization in USD bn. It is calculated by multiplying a The symbol indicates that the previous MT Tech Trend was positive.
firm's share price by the number of outstanding shares. For reasons of comparison, all results
are in USD. The symbol indicates that the previous MT Tech Trend was negative.

Valuation Rating 4wk (Rel) Perf.

Our Valuation Rating indicates if a stock is "expensive" or "cheap" relative to its growth This figure measures the performance of a stock relative to its national or regional index
potential. This is used to determine whether or not the investor is paying a premium for (compared to four weeks ago). As for an Index, it measures the net performance over 4 weeks.
anticipated growth. Bad News Factor
To estimate a stock's value relative to its current price, our Valuation Rating combines: To determine the "Bad News Factor" we analyze a stock's declines in rising markets. In this
- stock price purely objective analysis, the actual reasons for a stock's behavior are not important. If a stock
- projected earnings price falls while its relative index goes up, it can be assumed that the stock's performance
- projected earnings growth has been affected by bad news - hence the name, "Bad News Factor".
- dividends Here a stock's movements are measured on a bi-weekly basis, during a sliding 52 week
We establish our rating by combining these elements. period. Every time a stock drops while its reference index rises, the difference is calculated
There are five ratings, ranging from strongly undervalued to strongly overvalued . in %, integrated into a yearly average and expressed in basis points.
The higher the "Bad News Factor," the more a stock has proven to be sensitive to bad news.
Stars
The lower the "Bad News Factor," the less the stock has proven to be sensitive to bad news.
theScreener.com's star rating system is designed to enable you to identify high-quality stocks
quickly and easily. Bear Market Factor
In this easy-to-use rating system, stars are earned for each element specified below: To determine the "Bear Market Factor" we analyze a stock's price movements in declining
- Earnings Rev Trend markets.
=
This is the analysis of the movements, in a bi-weekly intervals, during a sliding 52 week period.
- Valuation Rating , , = The higher the "Bear Market Factor," the greater the probability a stock would drop when its
- MT Tech Trend = relative index drops.
- 4 week Relative Performance > 1% = A "Bear Market Factor" that is strongly negative means the stock has been more resistant
Therefore, a stock can earn a maximum of four stars. to losses in declining markets.
The lowest rating a stock can have is no stars. Sensitivity
Once a stock has earned a star, it will keep it until: Stock price developments are generally volatile and contain high risks that can result in a total
- Earnings Rev Trend becomes negative loss. Based on a their historical behaviour, stocks are classified by sensitivity level. These
- Valuation Rating becomes negative , sensitivity levels have to be considered solely in relative historical comparison to other stocks.
Please note that even “Low Sensitivity” stocks are equities and therefore high risk investments
- MT Tech Trend becomes negative
that can lose up to all of their value, and that past performance is no indication of current or
- 4 week Relative Performance drops below -1% (<-1%) future performance.
Div "Sensitivity" is determined by measuring the "Bear Market Factor" and the "Bad News Factor"
against its benchmark.
This is the dividend in % for the next 12 months.
There are three grades of sensitivity levels:
Even if the same number is shown, the dividend value can appear in one of four colors,
- Low Sensitivity: The sensitivity indicators fall below the world reference average.
depending on the earnings coverage:
- Moderate Sensitivity: The sensitivity indicators are situated higher than the world reference
- 0%, no dividend
average, but lower than standard deviation.
- 4%, the dividends are covered (between 0% and 40% of earnings)
- High Sensitivity: The sensitivity indicators are at levels higher than standard deviation.
- 4%, the dividends represent between 40% and 70% of earnings
- 4%, the dividends are higher than 70% of earnings, which implies that the dividend Volatility 12 M
coverage is not guaranteed. Volatility measures the magnitude of upwards and downwards movements of a stock or index.
Earnings Rev. Trend The volatility 12 M shows the average volatility over the last 12 months.

The symbol shows that compared with their earnings revisions of seven weeks ago, the % of Stocks in Uptrend
This is the percentage of stocks in a given list that have a positive Medium Term Technical
analysts have now raised their estimates (7wk EPS Rev; > 1%); the symbol indicates that
Trend. If, for example, the aggregate of Technology / World, (which is made up of 458 stocks)
compared with their earnings revisions of seven weeks ago, the analysts have now lowered
has 8% "of stocks in Uptrend," it means that 38 of the stocks within that aggregate have a
their estimates (7wk EPS Rev < -1%).
positive Medium Term Technical Trend.
When the earnings revisions (7wk EPS Rev) fall between +1% and -1%, the trend is
Beta
considered to be neutral .
Beta is often used as a measure of sensitivity. Where a Beta is greater than 100, the stock
The symbol indicates that the last significant revisions have been trending positive. is more volatile than its reference index.
The symbol indicates that the last significant revisions have been negative. Correlation
7wk EPS Rev Correlation is the degree of similarity in which a stock fluctuates in relation to its reference
This is an abbreviation for 7 week Earnings Per Share Revision. This column indicates the index.
value of these revised earnings. A figure of 2.8 signifies that compared with seven weeks

Disclaimer:
This report is provided for your personal information only, and does not constitute or contain any solicitation, financial advice, or offer to buy or sell any kind of securities. This report was based on sources
that we consider reliable, but we do not warrant the accuracy and exhaustiveness of the information, opinions and quotes provided. Past performance is no guarantee of future results.
More information: www.thescreener.com/en/wc/methodology.htm
Earnings forecasts provided by REFINITIV.

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