Gold bars to be exempt from tariffs, White House clarifies
On Friday, BofA Securities analyst Philip Albert Felix upgraded Universal Robina Corporation (URC:PM) (OTC:UVRBF) to Neutral from its previous Underperform rating and increased the price target to PHP95.00, up from PHP59.75. The upgrade reflects a positive shift in the company’s outlook, with the analyst citing several key factors for the revised rating and price target.
The adjustment in the rating and price target comes after a comprehensive review of Universal Robina’s financial year 2024 and first quarter of 2025 performance, alongside a reduction in the estimated capital expenditures for financial year 2025 by 23% to PHP10 billion. The Branded Consumer Foods Philippines (BCF PH) segment showed promising signs of growth in the first quarter of 2025, achieving a 4% year-over-year revenue increase, which was also 7% higher than the previous quarter. This growth was largely attributed to successful volume sales driven by the company’s value intervention program introduced last year, along with a favorable price recovery in sugar.
Despite the positive revenue growth, Universal Robina faced challenges with lower gross margins, primarily due to increased costs of Robusta coffee. Additionally, the company saw a decline in earnings before interest and taxes (EBIT) by 30% year-over-year in its animal nutrition segment and a 50% drop in flour EBIT, as a result of the startup costs associated with a new plant in Malvar, Batangas. The overall gross profit margin (GPM) for the first quarter of 2025 decreased by 2.6% year-over-year to 26.6%.
In light of these developments, BofA Securities has raised its core profit estimates for Universal Robina for the fiscal years 2025 and 2026 by 23.5% and 25.9%, respectively, to PHP12.6 billion and PHP12.9 billion. The firm also increased its revenue forecasts for the same years by 6% to PHP177 billion and PHP185 billion, respectively. The revised estimates and rating upgrade reflect a cautiously optimistic view of Universal Robina’s financial prospects as the company navigates through operational challenges and capitalizes on growth opportunities.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.