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The Pryce ($PPC) Paradox: Record Profits, Still a “Value” Stock?


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Disclaimer: This is for informational purposes and is not investment advice. Figures are taken from company disclosures and exchange data; valuation ratios include the author’s calculations based on cited inputs. 



By the numbers, Pryce Corporation (PPC) is having a vintage year. By the market’s temperament, it still trades like it has something to prove.

Pryce Corporation’s third-quarter filing reads like the kind of report investors usually reward: nine-month net income surged 35.1% year-on-year to ₱2.99 billion, while revenues rose 10.6% to ₱16.97 billion. The headline isn’t just growth—it’s quality of growth, with profitability ratios moving in the right direction: net margin improved to 20.8%, ROE climbed to 17.33%, and ROA rose to 12.26%.

And yet, for all this fundamental muscle, PPC often sits in that familiar Philippine-market category: the steady earner that still looks cheap. That disconnect is exactly where the story—and the opportunity or caution—begins.

LPG Still Pays the Bills—but the Plot is Thickening

PPC remains, in economic reality, an LPG company first. In the first nine months of 2025, LPG contributed ₱14.61 billion, or 86.09% of consolidated revenues, up 3.81% from the previous year.  Volume growth was modest but positive: LPG sales volume increased to 210,155 MT (+2.75%).

That’s the “boring” part—stable, essential demand. The more interesting nuance is what management implies about margins: PPC points to an expanding customer base—particularly in Luzon—switching toward branded LPG, which improved margins and helped lift overall earnings. If sustained, that’s not just a quarterly win; it’s a structural upgrade in pricing power and mix. 

PPC’s LPG footprint also benefits from regional strength. Its subsidiary Pryce Gases (PGI) is cited as having 13.3% national market share, with particularly strong positions in Visayas (21%) and Mindanao (27%).  In a country where logistics and distribution are competitive moats, those percentages matter. 

Industrial Gases: The Second Engine Finally Revving

If LPG is the anchor, industrial gases is the growth narrative investors have been waiting to see mature.

In the same nine-month period, industrial gases revenues rose 32.03% to ₱878.7 million, while industrial gas volume jumped 73.4% year-on-year—a signal of ramp-up rather than mere pricing. This matters because industrial gases can be stickier (contracted demand, industrial customers) and can support more predictable returns once plants reach scale. 

The longer arc appears in PPC’s FY2025 press release: the company reported full-year net income of ₱4.01 billion (+30%) and revenues of ₱22.72 billion (+9.6%), while industrial gases expanded 32.3% to ₱1.21 billion, reflecting the ramp-up of new air separation plants and stronger demand. More importantly, PPC disclosed it remains focused on scaling its industrial gas footprint, including an air separation plant in Davao targeted for completion in early Q1 2027.

For valuation, this is crucial: the market tends to pay higher multiples for businesses that look less like commodity distribution and more like industrial infrastructure.

The Quiet Earnings Booster: Investments and Mark-to-Market Gains

Now we get to the part that can both excite and unsettle investors: financial income.

In the nine-month report, PPC recorded a fair value gain on financial assets at FVPL of ₱847.28 million, up sharply year-on-year, and dividend/other income of ₱310.05 million, also dramatically higher. Those are not rounding errors—together, they explain a meaningful slice of the earnings acceleration. 

The balance sheet shows why: financial assets at FVPL rose to ₱5.23 billion, a steep jump versus the previous year, making PPC not just an operating company but also a sizeable market investor.

This is the double-edged sword in valuation. Markets often discount “mark-to-market” earnings because what lifts profits in a strong tape can reverse when sentiment turns. PPC itself discloses sensitivity to market swings: a 5% move in equity prices would materially affect profit and equity.

For investors, the practical takeaway is simple: separate “operating earnings” from “portfolio earnings” when thinking about what multiple PPC deserves.

Balance Sheet: Quietly Strong, More Liquid Than Many Realize

If PPC has a trump card, it’s liquidity.

As of September 30, 2025, PPC reported ₱4.11 billion in cash and cash equivalents and ₱5.23 billion in FVPL financial assets, with a current ratio of 2.19 and debt-to-equity of around 0.41. That combination—a sizable liquidity cushion with manageable leverage—creates optionality: PPC can fund expansion, support dividends, buy back shares, or deploy capital when competitors can’t. 

Profitability also isn’t being “bought” with leverage. Coverage remains strong: the filing highlights interest coverage of about 21.67x, underscoring comfortable debt service.

The Shareholder Yield Angle: Buybacks + Dividends

Another underappreciated part of PPC’s story is the quiet compounding effect of capital returns.

Nine-month EPS rose 36% to ₱1.475, slightly outpacing net income growth—helped by a lower effective share count from continuing buybacks.  PPC reported 143,953,831 treasury shares, reflecting an extended buyback program.

Dividends remain part of the equation: PPC declared ₱0.26/share cash dividends in 2025, following ₱0.20/share declarations in 2024. Meanwhile, the FY2025 release emphasizes that EPS for the full year rose to ₱2.1331 from ₱1.6449—a clear marker of shareholder value creation.

In a market where many “growth” stories take years to translate into cash returns, PPC is already doing both: reinvesting and returning capital.

So What Does This Mean for Valuation?

At the filing date, PPC’s reported share price was ₱12.60._November%2006,%202025.pdf) Pair that with 9M EPS of ₱1.475, and you’re looking at an annualized earnings power that can place the stock in mid-single-digit P/E territory—depending on whether you include the investment gains and how you normalize them.

That’s the crux:

  • If you believe LPG margin improvements are durable and industrial gases will scale into a steadier earnings engine, the current valuation can look conservative. 
  • If you believe 2025 earnings are meaningfully boosted by market-driven FVPL gains that could reverse, you may prefer to value PPC on a cleaner operating base—and assign a lower multiple to the investment component.

Either way, the market is forced to reconcile two truths: PPC is both a real-economy distributor/producer and a financially active balance sheet manager.

What Investors Should Watch Next

  1. Industrial gas ramp and project execution—especially the timeline to the Davao air separation plant (targeted early Q1 2027). 
  2. Sustainability of LPG margins, given modest volume growth, but improving economics tied to brand switching.
  3. FVPL earnings volatility—a great tailwind in strong markets, a potential headwind in weak ones.
  4. Capital return consistency—buybacks and dividends remain a major part of PPC’s equity story. 

Closing Thought

Pryce Corporation is showing the hallmarks of a company graduating from “steady” to “strategic”: strengthening margins in its core LPG franchise, scaling an industrial gases platform with visible capex runway, and maintaining a liquidity position that gives it flexibility most firms envy. 

The market may still treat it like a value stock. But if PPC’s second engine keeps firing—and if investors grow comfortable separating operating strength from portfolio noise—this could be one of those quiet compounders that eventually forces a rerating. 

Disclaimer: This is for informational purposes and is not investment advice. Figures are taken from company disclosures and exchange data; valuation ratios include the author’s calculations based on cited inputs. 


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