AC Energy Philippines Inc. (ACEN) saw its shares decline 13.1-percent week-on-week amid profit taking and the ex-rights date of its stock rights offering.
The energy arm of Ayala Corp. shed 19 centavos or 2.37 percent to close at P7.82 apiece on Friday.
Philstocks Financial Inc. senior research analyst Japhet Tantiangco said ACEN’s decline was on the back of profit taking as it has been rallying for seven straight days prior its slip on Tuesday, bringing its price up by around 66 percent.
One of AC Energy’s subsidiaries is the South Luzon Thermal Energy Corp. in Calaca,Batangas. PHOTO FROM AC ENERGY WEBSITE
The stock also recorded its 30-day high of P11.28 on Tuesday before closing in the red.
Tantiangco noted that investors also unloaded their positions on Friday, which was the ex-rights date of its stock rights offering.
“By this time, ACEN shares were no longer attached with the rights to be offered additional shares at a discounted price of P2.37 per share,” he explained.
AAA Equities head of research Christopher Mangun said ACEN’s decline was expected as investors dumped shares on the ex-date of its stock rights offering.
“Shares of companies that conduct stock rights offerings always decline due to the expected dilution after the issuance of new shares,” Mangun said.
“Another factor was the large premium that ACEN shares are currently trading at compared to the price of the rights offering,” he added.
Despite this, Mangun said investors still favor ACEN as its shares already recovered more than 20 percent from its low last week.
“It may continue higher next week if demand picks up. More updates on private placements of institutional investors, like GIC that expressed its intent to buy P20 billion worth, will boost the sentiment,” Mangun said referring to GIC Private Ltd. of Singapore.
Meanwhile, Tantiangco said investors are expected to focus on the prospects of ACEN.
A positive bias is seen given the support the renewable energy sector is receiving, especially from the government.
“As we all know, ACEN is heavily investing in the renewable energy space. Investors are also expected to look towards ACEN’s full year 2020 results to have a better grasp of the company’s financial performance. Finally, investors are looking towards the planned infusion of AC Energy Inc.’s international business into ACEN,” Tantinagco continued.
Mangun likewise expects ACEN to continue being a “favorite” this year as renewable energy remains to be an emerging industry.