How Expensive is Jollibee Food Corporation (JFC)? Updated 3rd Quarter

Jollibee Foods Corporation (JFC) was incorporated on January 11, 1978. JFC's principal business is the development, operation, and franchising of quick-service restaurants under the trade name "Jollibee". In the Philippines, JFC also has, as subsidiaries, Fresh N' Famous Foods, Inc., which develops, operates and franchises quick-service restaurants under the trade names "Chowking" and "Greenwich"; Red Ribbon Bakeshop, Inc., which develops, operates and franchises restaurants under the "Red Ribbon" trade name; Mang Inasal Phils., Inc. (MIPI), which develops, operates and franchises restaurants under the "Mang Inasal" trade name; and Perf Restaurants, Inc., which franchises restaurants under the "Burger King" trademark in the Philippines.

JFC also has subsidiaries and affiliates overseas which develop and operate its international brands, "Yonghe King", "Hong Zhuang Yuan", "San Pin Wang" brands under the SuperFoods Group, "12 Hotpot", "Jinja" and "Dunkin' Donuts".

On October 13, 2015, the Company's wholly-owned subsidiary, Bee Good! Inc., entered into an agreement with Smashburger Master LLC to acquire 40% of "Smashburger", a fast casual better burger brand in the US. In April 2016, JFC acquired the remaining 30% share in MIPI, making the latter wholly-owned by the Company.

By the end of 2015, there were 916 Jollibee stores nationwide, of which 459 were franchised and 457 are Company-owned. In international operations, Jollibee had 139 stores with 32 stores in the US, 72 in Vietnam, 13 in Brunei, one in Hong Kong, two in Singapore, and 19 in the Middle East.

As of Dec 22, 2016, JFC was last traded price at PHP 185.50. This is 5.95 times higher compare to their recorded book value as according to their September 2016 financial report. This is expensive for most value investor since, a PBV of more than 3 is considered expensive.

In terms of P/E, the company recorded a trailing P/E of 40.24 meaning, for every 1PHP earning last 2015, investors of this company are willing or is paying 40.24PHP which is quite expensive. With a 40.24 P/E and with a negative growth since EPS dropped from 5.03 to 4.61 from 2014 to 2015 respectively, the company trailing PEG ratio would also be negative which means, investors of this company are paying 40.24PHP for every 1PHP income last 2015 even though, the company grows negatively from 2014 to 2015.

In terms of income, the first 9 months net income attributable to parents this year increases by 13.75% in comparison to last year first 9 months net income.

Disclaimer: Trade or invest at your own risk.