FREE Stock Picks for the week (Jan 13-17, 2025) by First Metro Securities

NOTE: This is a Premium-exclusive stock report, originally for our Premium Access members, but we’re giving this to you free! To view other FREE stock reports, just click here. To get full access to all Premium-exclusive reports, simply upgrade to Premium Access today for as low as P399.00 a month!

Market Recap: Stock market last week

Last week, the index ended lower by -1.63% week-on-week, closing at 6,496.32–a decrease of 107.49 points. Investors’ sentiment remained cautious following Dec’s inflation rate at 2.9%. While it was still within the 2-4% target range and 2.3-3.1% forecast of the Bangko Sentral ng Pilipinas’ (BSP), the inflation rate exceeded the consensus forecast of 2.6% and marked an increase from Nov’s 2.5%. Meanwhile, the improvement in Nov’s unemployment rate at 3.2% (from Oct’s 3.9%) failed to buoy sentiment. Additionally, investors also digested the Federal Reserve’s meeting minutes reflecting the possibility of maintaining elevated interest rates amid persistent inflation risks. On the last trading day of the week, volumes were muted as the United States (US) observed the national day of mourning for former President Jimmy Carter.

PSE outlook this week

This week, we anticipate the market to trade sideways with downward bias, as the US 10-year bond yield rose by 8.1 bps to 4.77. Investors are also awaiting the inauguration of President Trump on 20 Jan 2025 and will be shifting focus on his initial policy pronouncements. Additionally, the local market will likely respond to the crude oil price data, and the US Dec inflation data set to be released on 15 January 2025, which is forecasted to have a slight uptick. With these uncertainties, the PSEi is likely to remain range-bound, with cautious trading ahead of these key events.

Stock Picks this week

1. Converge ICTS, Inc. (CNVRG)

In line with the company’s future plans with its partnership with US tech giant Supermicro to pioneer AI-powered data centres in the Philippines, we expect CNVRG to experience long-term growth. This long-term growth will be driven by its data centres implementing AI computing capabilities and intensive deep learning tasks that will allow CNVRG to support and deploy many AI applications in its various business processes.

Accumulating CNVRG in its key support levels between PHP 14.00-15.50 is advisa-
ble. Set stop limit orders 8% below and take profits 15% above your averagcost. For long-term investors, we have a fundamental target price of PHP20.50.

2. Wilcon Depot, Inc., (WLCON)

Our latest estimates show WLCON’s ranking by full market capitalisation landing at 33rd. While this is above the 36th place benchmark for index deletion, WLCON is now the second-lowest ranked index name. As Nickel Asia Corp.’s (NIKL) deletion from the index, at rank 39, is now certain, China Banking Corp. (CBC) is set to enter the PSEi. This means that as long as a second candidate rises above 25th place, WLCON is at risk of deletion, with the most promising contender being AREIT.

Lightening positions is advised to protect against potential unfavourable impacts of index deletion.

3. Nickel Asia Corp. (NIKL)

Our latest estimations show NIKL’s ranking by full market capitalisation falling to 39th place, with its volume-weighted average price (VWAP) having dropped by 42% year-to-date. As this is below the 35th place benchmark to remain in the index, NIKL’s exclusion from the PSEi is now certain – regardless of whether CBC is able to push it out.

Lightening positions is advised to protect against potential unfavourable impacts of index deletion.

NOTE: This is a Premium-exclusive stock report, originally for our Premium Access members, but we’re giving this to you free! To view other FREE stock reports, just click here. To get full access to all Premium-exclusive reports, simply upgrade to Premium Access today for as low as P399.00 a month!

This report is prepared by PinoyInvestor’s partner broker below. Find out more about our partner brokers and sign up to avail their complete trading brokerage services.