Dec. 13, 2011- MEG Below 1.75

In the year 2011, Megaworld’s stock price has only dropped lower than 1.75 at only one time until today.  It was when the Philippine Composite crumbled to 3,700 end of September to early October.

1.) September 23 – Oct 14, 2011 Historical Broker Transactions

Brokers that accumulated during the sell off were primarily Macquarie, Aurora, BDO, JPMorgan, Goldstar and Wealth with net buy transactions greater than Php10 Mil.  The biggest sellers are coming from foreign brokers with CLSA at the helm, with DBP Daiwa, Deutsche, UBS and ATR-KE following with the selloff.

2.) The Scenario Today – Dec 12, 2011- Present – Another Sale? Or Cheaper for a Valid Reason?

Without going to the possibility that the exercise of the warrants at Php1.00 being the primary trigger for the sell off in MEG’s stock price, let’s first check at the primary big sellers causing the large sell off.  Below, I highlight the biggest sellers for the past two days on MEG, breaking the critical 1.78 support level of MEG with huge volumes, giving way to a big slide recently.

*Historical transactions from Dec.12-13, 2011

Notice in this sell off that CLSA and Credit Suisse were the first triggers of the sell off, selling huge truckloads at 1.76-1.78 leading other “followers of momentum”/ technicians to cut loss on their positions, hence BDO, Jaka, Macquarie and Deutsche’s selling prices are all selling shares lower than 1.75

Notice too in this sell off that CLSA is another big bulk seller in these low prices, same to the prior Philippine Composite sell off last September.  Either CLSA, often sells MEG shares at a bargain, or does CLSA and CSUISSE know something?  Can they be selling something fundamentally related?

Technically, the stock looks to retest its previous supports of 1.50-1.60 range.

*Another interesting thing I have observed is that CSUISSE has bought back 3M shares at 1.68-1.69 levels after selling a huge 30Mil position at 1.78, I’ll be watching what CLSA and CSUISSE does in the next couple of days, if I’ll be trading the stock MEG other than the charts.

What do you think?

-Faceless Trader


About Abc

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11 Responses to Dec. 13, 2011- MEG Below 1.75

  1. Mon says:

    MEG is now more BPO and gaming (RW) than property sales company. Proposed US legislation to limit outsourcing may have been a reason for the sell off. Earlier, COL surmised that SMDC’s move to do a “firesale” of it’s units until the end of the year may imply some glut in the residential condo segment.

    My take?
    1. I don’t think such protectionist legislation will pass. Globalization is an economic reality. So is contagion, unfortunately.
    2. Well, ALI does not see a glut as it continues to post record profits.

    Verdict: Buy MEG into weakness fundamentally. Technicals (which “I know nothing”) may tell you when.


  2. he-man says:

    thanks but i wld rather not see ur ledger.


    • Jclever says:

      possible window dressing? diverting funds to more fundamentally better property compamy like ALI maybe? to make portfolio better this year end?

      i dont know also sir. but im loaded with MEG..


      • I generally am not a fundamentalist, so when price action deviates from my plan, I’ll be cutting losses. Nevertheless, as for this stock…I believe even if it makes any window dressing move, it will most likely just hover at most at 1.80 (where it traded quite heavily based on the volume of trades for the year). I’d probably bet more on other companies for a window dressing move that has better chart formations such as EDC. I don’t like ALI’s chart either.


  3. footballer says:

    the smdc “fire sale” applies only to two of sm’s condos. as such one can’t conclude that there is a glut, at least from the alleged “fire sale”.


  4. Pingback: MEG on a potential uptrend « Jaydee Says So

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