PHP20 billion wiped off PLDT’s stock following Morgan Stanley downgrade

9 Feb 2006

Philippine Long Distance Telephone Company (PLDT) saw close to PHP20 billion (USD387 million) wiped off its market value yesterday, following a downgrade by US-based investment bank Morgan Stanley. The telco’s share price dropped 6.1% amid frenetic trading on the local stock exchange that left the company’s market valuation reeling at PHP303.9 billion, down from PHP323.8 billion in a single day. Attempting to play down the dramatic fall, PLDT chairman Manuel Pangilinan said he was unaware of anything ‘now or prospectively’ that could have sparked Wednesday’s freefall, adding that the telco’s revenues in January were up year-on-year while profits in 2005 had reached PHP30 billion – a record high. On Tuesday, Morgan Stanley downgraded the company to ‘equal-weight’ from ‘overweight’, saying the stock had limited upside potential. But Pangilinan looked to calm twitching nerves, saying ‘With all these positive developments, the market is behaving irrationally.’