How we made 23.05% gains investing AC, Ayala Corporation stocks? It’s no secret that AC was included on our Magic 10 stocks and list of undervalued stocks. It was one of the stocks that we flipped taking the opportunity while it was cheap in the recent months. What if you are investing AC stocks for long term? Go forth and read…
Why would we flip AC?
First, it’s among the best blue chip stocks, there is not much risk. Second, AC was currently cheap based from our marker valuations and lastly, Ayala Corp. is one of the giants, a well-established holding company with stable growth and recurring earnings from its families like BPI, ALI, and MWC.
After a short market briefing last week, we decided to reduce our Target Price on some of our stocks here as financial and market experts are advising to “lessen our expectations.” We used to have a target of more than 800 for AC but we decided to reduce it and make it to 800 to reach our target sooner and give chances for other stocks (don’t miss the new stock we will add on our list replacing AC).
How we made 23% gains flipping AC stocks?
Following our strategy for Fantastic 5 stocks, we only buy and follow the BBP (Buy-Below-Price) and that was only for 2 months. This month of May, AC reached our Target Price of 800 and we should let go of our shares. We only made 6,280 gains because we were investing 20 shares per month; it’s still 23.05% growth. Note that fees were not included below.
What if You’re Investing AC for Long Term?
If you are investing AC for long term, 5 years or so, it is also good because this company is very strong. As a matter of fact, Ayala Corp.’s Net Profit on the first quarter this year is up by 15% compared last year. AC made 5.8 billion pesos this first quarter of the year 2016. AC is targeting to hit 50 billion net profit by 2020. Wow, that is almost 4 times it made this 1Q year, then. We are confident it will reach its expectation.