Jollibee Foods Corporation: Cost pressures sting like a bee – downgrade to Neutral, PO at P150

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Jollibee Foods Corporation: Cost pressures sting like a bee – downgrade to Neutral, PO at P150

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Jollibee Foods Corporation

Cost pressures sting like a bee –

downgrade to Neutral, PO at P150

Rating Change: NEUTRAL | PO: 150.00 PHP | Price: 133.00 PHP

Cost pressures sting - downgrade to Neutral 20 May 2026

We downgrade Jollibee Foods Corporation (JFC) to a non-consensus Neutral from Buy Equity

rating and lower our PO to Php150 from Php280. Rising raw material costs triggered by

the ME conflict were already visible in the 1Q26 results and may dampen profitability

Key Changesfurther. We lower our FY26-28E EPS to common by 25% on average as we factor in

anticipated GPM contraction previewed in 1Q26. This now implies a 19% YoY drop in (PHP) Previous Current

FY26E profit to common, among the worst hit PH consumer companies in our coverage Inv. Opinion B-1-7 B-2-8

universe by the ME conflict-induced inflation shock. We lower our PO by 46% to Php150 Inv. Rating BUY NEUTRAL

from Php280 as revisions cut our DCF-based valuation and our target FY26E P/E Price Obj. 280.00 150.00

multiple now puts JFC in line with PH consumer peers at 13x vs. previous 22.8x, at par 2026E EPS 10.57 7.64

with global peers. In our view, the 39% share-price decline since end-Feb fairly prices 2027E EPS 11.63 8.43

short-term margin headwinds while long-term FR plans should limit further downside. 2028E EPS 12.43 10.18

We also change our income rating from 7 (same/higher) to 8 (same/lower).

The margin squeeze has only begun JulianResearchRoxasAnalyst^^

After a 210bp GPM contraction witnessed in 1Q26, we believe 2Q26 may see the full Philippine Equity Partners

impact of the cost pressures from the ME conflict that started on 28 February. JFC has +63julian.roxas@pep.com.ph2 8640 6780