PIP – Pepsi International Products Philippines, traded at the Philippine Stock Market (Not the same as the NYSE stock, PBG)
I first bought my 1,000 shares in 2008 when it was 2.9 per share. It fell a month later to 0.98. Imagine my shock when I saw my money get bashed to a dime. Rising oil prices and the worldwide depression caused the “market short overreaction.” At that time I sold most of my other stocks. Think about buying low and selling high, a mortal sin for value investors. But if I didn’t do what I did, most of my money would have shrunk to 25% of its previous value. PIP was an odd lot after the fall. So I couldn’t sell it. I decided to just forget about it. After 2 more quarters, it was obvious that PIP turned out to be one resilient company. It’s annual net earnings decreased by 26% but with introduction of a new Tropicana brand and for some other reason that is not quite clear to me yet (talk about doing research), quarterly earnings are going up and so is the asset base (new bottling plants? rising demand?). Analyzing the fundamentals is a privilege for me. I only have a short time to scan the damn balance sheets. I remember doing some computation regarding its present liquidity and other financial chuvaness but it was a good guess that the issue was way undervalued when I decided to buy 14 thousand more shares. It was amazing to note that what was once my weakest stock pick a year ago became my greatest capital earner now.
Pepsi International Products Philippines is a holding company for bottling plants that manufactures and distributes Pepsi Cola, Mountain Dew, 7-Up, Mirinda, Gatorade, Tropicana, Lipton, Sting, and Propel. Food Franchises such as KFC and most cinemas in the Metro Manila have (or seems to have ) exclusive rights to sell only Pepsi beverages. The beverages are also popular in all 24-hour convenience stores. Although some doctors actually prescribe Gatorade for dehydration, I will abide by WHO’s stand on Gatorade.
PIP Purchase Price: 1.33, Closing Price (October 2, 2009): 2.48
Gain: 86.33% (This might actually be my first two-bagger. I just wish present valuations continue for the long term)
PS: My big thanks to Spyfrat for providing technical information for this stock.