BDO Unibank Inc (BDOUF) is a Philippine Banking Company and, the largest in the Philippines in terms of assets, loans and deposits. Moreover, the bank is the 15th largest in SouthEast Asia. It was founded on January 2, 1968 in Manila and headquartered in Makati. Its key areas are the Philippines, Asia, Europe, Middle East and North America. BDO Unibank is registered under the Philippine Stock Exchange (PSE) with ticker symbol BDOUF.
As a full service universal bank, it caters banking services including foreign exchange, brokerage, trust and investment and credit cards, corporate cash management and remittances.
BDO Unibank Inc (BDOUF) Extended Graph Analysis
1. BDOUF CASH FLOW
|Net cash flow provided by operating activities||-33,605,000,000||-12,928,000,000||37,249,000,000||-2,819,000,000||90,312,000,000||23,730,000,000|
|Net cash used for investing activities||-490,000,000||-10,211,000,000||-30,318,000,000||-67,731,000,000||-56,740,000,000||-63,597,000,000|
|Net cash provided by (used for) financing activities||5,220,000,000||-10,837,000,000||-1,545,000,000||83,983,000,000||2,399,000,000||19,726,000,000|
|Free cash flow||-39,575,000,000||-19,891,000,000||31,712,000,000||-8,977,000,000||82,177,000,000||19,670,000,000|
- Net cash flow provided by operating activities is Php 23.730 billion.
- Net cash used for investing activities is -Php 63.597 billion.
- Net cash provided by (used for) financing activities is Php 19.726 billion.
- Capital expenditure is -Php 4.060 billion.
- Free cash flow is Php 19.670 billion.
- Cash from operation increased by more than 3,000 percent at Php 87 billion in 2018, however showed a decreased of 74 percent at Php 67 billion in the trailing twelve months.
- Cash used for investing activities were investment in property, plant and equipment; and purchases of investments.
- Cash provided by (used for) financing activities were debt issued and repayments plus dividends payments.
- Capital expenditure is investment in property, plant and equipment.
- Free cash flow had a growth of 150 percent in five years.
The net change in cash was Php 36 billion in 2018 and -Php 20 billion in the trailing twelve months. In other words, cash at the beginning was higher than the cash at the end in the trailing twelve months.
2. BDOUF BALANCE SHEET
- Total cash was Php 54 billion in 2018 and in 2019 trailing twelve months respectively.
- Total assets were Php 328 and Php 364 billion in 2018 and the trailing twelve months respectively.
- Total liabilities were Php 777 million and Php 1.684 billion in 2018 and the trailing twelve months respectively.
- Equity was Php 327 and Php 362 billion in 2018 and the trailing twelve months respectively.
- Retained earnings were Php 156 billion in 2018 and the trailing twelve months.
- Total cash represents 15 percent of the total assets in 2018 and 2019 trailing twelve months.
- Total assets have grown 103 percent in 5 years.
- Total liabilities increased by 117 percent from 2018 to the trailing twelve months.
- Total liabilities is less than half percent or 0.46 percent of the total liabilities and shareholders equity.
- Equity has grown by 102 percent in five years.
- Equity is 99.5 percent of the total liabilities and shareholders equity.
- Retained earnings have grown 123 percent in five years.
- Retained earnings represents 43 percent of equity in the trailing twelve months.
BDO has a strong balance sheet. The company is using investor’s investment more than creditors in its business operation. The shareholders have more stake in the business.
3. BDOUF INCOME AND MARKET
- The total revenue was Php 158 billion in the trailing twelve months.
- EBIT was Php 61 billion in the trailing twelve months.
- Net income was Php 43 billion in the trailing twelve months.
- The market capitalization was Php 13.6 billion in the trailing twelve months.
- The intrinsic value was Php 47.668 billion in the trailing twelve months.
- Revenue has grown 107 percent in five years.
- Revenue growth year-over-year is increasing from 2014 to the trailing twelve months.
- EBIT has grown 92 percent in five years.
- EBIT represents 38 percent of the revenue in the trailing twelve months.
- Net income has grown 90 percent in five years.
- Net income represents 27 percent of the total revenue in the trailing twelve months.
- Net income year-over-year growth was 16.52 percent in 2018.
- Market capitalization had increased 55 percent from 2014 to the trailing twelve months 2019.The value was increasing year-over-year.
- The intrinsic value has grown 59 percent in five years and it is increasing year-over-year from 2014 to 2018.
- Intrinsic value was greater by 250 percent against market capitalization in the trailing twelve months.
The company is profitable. The record shows that from revenue down to the bottomline, the management is efficient in generating sufficient income for its business operation.There was no record of negative earnings in the last five years.
4. BDOUF FINANCIAL RATIOS
|Asset turnover (average)||0.04||0.04||0.05||0.05||0.05||0.05|
|Return on assets %||1.27||1.27||1.18||1.11||1.14||1.43|
|Return on equity %||13.52||13.42||12.70||11.00||10.53||12.86|
- Asset turnover was averaging 0.05 in the trailing twelve months.
- Return on assets was 1.43 percent in the trailing twelve months.
- Return on equity was 12.86 percent in the trailing twelve months.
- Debt/Equity was 0.50 in the trailing twelve months.
- Asset turnover indicates that the company is making 50 centavos of sales for every one Peso invested in assets.
- Return on assets indicates that the company produced Php 1.43 of net income utilizing its investment in assets.
- Return on equity means that for every Peso in common shareholders equity, the company generated 13 centavos of profit.
- Debt to equity indicates that the assets of the company are funded 2 is to 1 by shareholders to creditors. In other terms shareholders own 66.6 centavos for every Peso of company assets while creditors own 33.3 centavos for every Peso.
The financial ratios of the company shows that the management is performing well in the operation of its business.
5. BDOUF KEY EXECUTIVES
|Teresita T. Sy-Coson||President and CEO|
|Edmundo L. Tan||Corporate Secretary|
|Sabino E. Acut Jr.||Assistant Corporate Secretary|
|Albin C. Go||Head – Legal|
|Daimacio D. Martin||Treasurer|
|Marilyn K. Go||Deputy Treasurer|
|Estrelita V. Ong||Chief Internal Auditor|
|Federico P. Tancongco||Chief Compliance Officer|
|Evelyn L. Villanueva||Chief Risk Officer|
- Teresita T. Sy-Coson – President and Chief Executive Officer
- Edmundo L. Tan – Corporate Secretary
- Sabino E. Acut Jr. – Assistant Corporate Secretary
- Albin C. Go – Head – Legal
- Damacio D. Martin – Treasurer
- Marilyn K. Go – Deputy Treasurer
- Estrelita V. Ong – Chief Internal Auditor
- Federico P. Tancongco – Chief Compliance Officer
- Evelyn L. Villanueva – Chief Risk Officer
Hence, the operation of the business is considered productive in the last five years the key executive team has the capabilities and talented in managing its business operations very well.
6. LOBBYING AND CONTRIBUTIONS
NO POLITICIANS OR LOBBYIST FOUND IN OPENSECRET.ORG AND IN OTHER SOURCES
7. BDOUF FINANCIAL STRENGTH
|Market value of equity||13,627,000,000|
|Book value of total liabilities||1,684,000,000|
|A – Working Capital / Total Assets||0.00||1.20||0.00|
|B – Retained Earnings / Total Assets||0.02||1.40||0.03|
|C – EBIT / Total Assets||0.17||3.30||0.55|
|D – Market Value of Equity / Book Value of Total Liabilities||8.09||0.60||4.86|
|E – Sales / Total Assets||0.44||1.0||0.44|
Formula: Z-Score = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E
Z-Score is a statistical measurement that compares data points from different sets of data to find correlations. This measurement by Dr. Edward Altman is a significant measure in determining the financial strength of the company because it relies on different weighted financial liquidity and profitability metrics to come up with the overall score. This measure indicates the probability of bankruptcy.
BDOUF has a Z-Score of 5.87. Dr. Altman’s grading scale of 3.0 and above indicates that the company will not declare bankruptcy in near future. In other terms, the company is not close to insolvency. The main factors of this statistical measurement are profitability, liquidity, leverage and efficiency.
The financials show that the balance sheet is stable and strong.The company is profitable and the management is efficient in producing sufficient revenue for the operation of the business. Moreover, the earnings per share growth was erratic in movement from 2010 to the current date 2019, however, its year-over-year growth was 43.16 percent in the trailing twelve months.
Overall, the stock of BDO Unibank Inc was currently undervalued from the day this article was published, and the stock is a good opportunity for a Buy.
Researched and written by Criselda