By Ian Sayson
July 31 (Bloomberg) -- Investors should switch to Philippine banking stocks from real-estate shares as gains this year may be excessive, Credit Suisse Group AG said.
Investors should hold shares of Metropolitan Bank & Trust Co., Bank of the Philippine Islands and Banco de Oro Unibank Inc., Gilbert Lopez, Manila-based strategist at Credit Suisse, said in an interview in Manila today.
The Philippine Stock Exchange Index surged 15 percent this month, Asia’s best performer and the measure’s biggest monthly advance since January 2002. Expectations of increased government spending and interest-rate cuts helped buoy property stocks, which make up half of the 10 biggest gainers on the gauge.
“Many target prices of real estate companies have already been reached that it’s worth considering to shift to a laggard sector like banks where the earnings outlook is still positive,” said Lopez, who has covered the Philippine stock market since 1992.
Earnings forecasts for banks have been raised by about 7.1 percent, the highest among the sectors in the Philippine market, Lopez said. Analysts may upgrade earnings of banks further as loans increase and the quality of their assets is “relatively sound,” he added.
Shares of Metropolitan Bank, the nation’s second-biggest bank by assets, may rise 21 percent from today’s close to 47 pesos, while Bank of the Philippine Islands may climb 12 percent to 51 pesos, Lopez said.
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