Telephone giant Philippine Long Distance Telephone Company (PLDT) or TEL in the Philippine Stock Exchange made news today when it soared by an amazing 15.72%, carrying the entire PSEi on its back.
Yes. PLDT made quite a splash as it soared from PHP 2,036.00 per share yesterday to a closing of PHP 2,356.00 today. As you can see from its chart above, the move is actually exhibited by wide bullish breakaway gap. With its value turnover reaching a little more than PHP 2.25 billion, it is quite likely TEL will still have some gas on its tank to move higher as many of the shares were bought near its present price levels. Notice also that the MACD histogram has just turned positive, giving a buy signal. Moreover, the RSI is still not in the overbought area, suggesting that it could still move up. Technically, however, there are some resistances at the PHP 2,400.00 and PHP 2,500.00 price levels plus at its 200-day moving average. But its recent breakaway gap, which is supported by heavy volume, could set it up for a nice ride north above those levels.
On the fundamental side, PLDT disclosed that it will purchase 51.55% of Digital Telecommunications Philippines or DGTL, which is the operator of Sun Cellular from the latter’s parent company JG Summit Holdings, Inc. (JGS). The total purchase price will amount to PHP 74.1 billion which will then be funded through PLDT’s issuance of new common shares that will be priced at PHP 2,500.00 per share. With this in mind, PLDT’s outstanding shares could be driven by the market to match or even exceed the said issuance price, leaving TEL’s shares with some more upside from its present level.