Philippine Online Trading Firm Identifies 6 Premium Growth Stocks

Manila, Philippines (AHN) - The public offerings of six major Philippine corporations were named by the leading Philippine online trading firm as premium growth stocks.

CitisecOnline identified the six stocks as Ayala Land, Bank of the Philippine Islands, Jollibee, Manila Water, Philippine Long Distance Telephone Company and San Miguel Prime Holdings.

In a press briefing Friday, the company pinpointed the six as top picks it will recommend to Filipino retail investors as it launched on Friday its Easy Investment Program. CitisecOnline introduced the program to help build up retail investors in the country.

The Easy Investment Program uses the cost averaging concept to encourage retail investors battered and burned by the 30 percent decline in the Philippine stock market in the first half of 2008 to reinvest in stocks.

CitisecOnline has been at the forefront of an educational campaign since it officially listed in 2007 to help raise up more retail investors. Despite the free fundamental and technical analysis seminars it offers clients, many Filipino investors new to the stock market find it difficult to chart the perfect time when to buy or sell an issue, explained Juan Barredo, COL vice president.

Instead of COL clients second-guessing when to buy, it suggested that retail investors buy regularly selected offerings considered as premium growth stocks. Based on the cost averaging concept, even if they lose when they purchase some stocks at a high price, the cost would even out over a long period of time as they buy more stocks at lower prices at different points.

Barredo demonstrated the cost averaging concept by charting the 17-year performance of 5 of the 6 selected stocks. The basket of 5 stocks yielded a return of 1,833.35 for the years 1990 to 2007. In comparison, the basket of PSE stocks yielded only 257.12 percent return rate, while investors in 91-day treasury bills got only a return rate of 151.52 percent.

Barredo said the basis of the COL research team in determining the 6 premium growth stocks were six criteria. These were: the stocks belong to a company in a growing industry, it had earning visibility, management credibility, superior products or services and a strong balance sheet. He added more stocks would be added to the 6 if future company offerings would pass the five-point criteria.

Of the 6 on its first list, Manila Water was on the roster of 7 stock buys for 2008 recommended by COL research head April Lee-Tan at its year-starter forum in January.