PHI (PLDT) Review

http://www.pldt.com/docs/default-source/presentations/2019/9m2019-presentation_final.pdf?sfvrsn=0

Share price keep tanking despite profitability. Market cap of ~4.5 B vs net debt of 2.9B. Debt is equally space out yearly with ~10% matured every year. Cash balance is 0.5B vs gross debt of 3.5B.
Interest payment is ~170MM annually based on 4.8% average interest rate. Net debt/ EBITDA is 2x indicating EBIDTA is 1.45B and interest coverage of 8.5x which is healthy.
The debt covenant of Net debt/Ebidta is 3x which will be raised to 4x after company seek for waiver for future debt raised for CAPEX spending. Currently, there is a big margin to hit the limit.
Debt/Equity is high and > 1.  Company bonds is currently investment grade.

Dividend yield is 6.9% based on morningstar quote indicating 300MM of dividend payment with market cap of 4.5B.

2019 CAPEX is 78B peso which is 1.6B USD which is higher than is EBIDTA. Based on 2011-2019, total CAPEX spent is 369B peso which is 7.4B and roughly 0.9B per year.

Assuming the same level of CAPEX spending going forward and an annual EBIDTA of 1.45B, Free cash flow is 0.55B and minus off interest expense, there is ~400MM available for dividend payout.
If the CAPEX investment leads to higher EBIDTA generation (high margin of ~50%), we can expect the dividend to be sustained or increased in future. current yield looks attractive based on the growth rate and PE ratio of 12x and Market cap/EBIDTA of 3-4x is not compelling.

Annual debt maturity is ~400MM. Company need to maintain the debt level or payoff with increase EBIDTA from its CAPEX.