SM Investments shares rise on dividend hike, buyback program

By Lourdes O. Pilar, Researcher

SM INVESTMENTS CORP. was among the most actively traded stocks last week following the announcement of higher cash dividends and the implementation of its share buyback program.

Data from the Philippine Stock Exchange (PSE) showed that 1.72 million SM Investments shares worth P1.04 billion changed hands from May 4 to 8.

The Sy-led conglomerate closed at P610 per share on Friday, up 0.7% from the previous week. The stock outperformed the holding firms index, which rose 0.3%, but lagged behind the benchmark Philippine Stock Exchange index (PSEi), which gained 2.2%.

Year to date, SM Investments shares have declined by 12.8%, compared with the holding firms index’s 6.2% drop and the PSEi’s 1.5% decline.

“What likely attracted interest into SM Investment was the announcement of its P17 per share cash dividend, which was a 31% increase year over year. Its share buyback program is likely another factor for its volume this week, buying back 175,870 shares amounting to P106.69 million between May 4-8,” Franco M. Fernandez, equity research analyst at DragonFi Securities, said in a Viber message.

Jash Matthew M. Baylon, equity trader at First Resources Management and Securities, said in a Viber message that SM Investments saw increased trading activity last week after the company raised its dividend payout.

“While the market initially reacted positively with robust buying volume due to increase on its dividend payout, the momentum was short-lived as weaker-than-expected macroeconomic data and heightened geopolitical uncertainty dampened the impact of the positive earnings report,” Mr. Baylon said.

In a disclosure last month, SM Investments said its board approved a 31% increase in dividend payments to P17 per share from P13 in 2025. The company said the increase reflected its ability to generate cash while continuing to invest for long-term growth.

The dividend represents a 2.4% yield based on the company’s Dec. 31, 2025 share price. Total dividends increased to P20.7 billion from P16 billion in 2025 and will be payable on May 28.

Since its listing on the PSE in 2005, SM Investments has returned P148.9 billion in dividends to shareholders as of end-2025.

In a separate disclosure, the company said its board approved on Feb. 28, 2025 the creation and implementation of a share buyback program involving up to P60 billion worth of common shares.

On May 7, SM Investments executed buyback transactions with a settlement date of May 11, 2026.

“We believe that this higher dividend, coupled with the company’s ongoing share buyback transactions, is a strategic move to boost investor confidence and signals a highly optimistic long-term outlook,” Mr. Baylon added.

In a press release last month, SM Investments reported a 7% year-on-year increase in consolidated net income to P21.5 billion for the first quarter. Consolidated revenues rose 5% to P159.4 billion from P152 billion.

Among the company’s core businesses, the banking segment contributed 49% of reported net earnings, followed by property at 28%, retail at 15%, and portfolio investments at 8%.

“First quarter earnings did little to lift the stock, as the market remains largely headline-driven. Its earnings were released a week before April inflation and first quarter GDP (gross domestic product), which investors focused on, alongside ongoing developments in the Middle East,” Mr. Fernandez said.

Data from the Philippine Statistics Authority (PSA) showed that the Philippine economy grew 2.8% year on year in the first quarter, slower than the 3% growth in the fourth quarter of 2025 and the 5.4% expansion in the same period last year.

The first-quarter GDP growth was the weakest since the 3.8% contraction recorded in the first quarter of 2021 and fell below the government’s 5-6% growth target for the year.

The PSA also reported that inflation accelerated to 7.2% in April from 4.1% in March and 1.4% a year earlier. This was the fastest inflation print since the 7.6% recorded in March 2023 and exceeded the central bank’s 5.6%-6.4% estimate for the month.

Analysts placed support levels for the stock at P590 to P600, while Mr. Baylon pegged resistance at P660.

“I would place immediate support in the P590-P600 range, with resistance at P650-P660. Overall performance of SM Investments has been unfavorable for investors,” Mr. Fernandez said.