JFC (Jollibee) surge after tech announcement tells ABS (ABS-CBN) about what drives value

Jollibee Food Corporation (JFC) surged to a high of 177.80 high after it announced the launching of its Jollibee app. Before that JFC was just trading at around 140 level.

The launching of the Jollibee app signifies that its Business Transformation program announced a quarter ago is taking shape.  The business transformation program of JFC is taking cue from Domino’s Pizza’s strategy.  Domino’s Pizza thrived even during the worst of the pandemic. Domino’s has perfected order-in and delivery through intensive innovation. Domino’s Pizza developed its own, single proprietary point of sale system for all of its stores (there are now more than 6,000 in the U.S., 94% franchise owned).

The companies best positioned for the Covid era had technology that allowed them to adapt quickly to changing times.

The JFC surge after the Jollibee app launching does not mean JFC may not go down again.  The app and the underlying capabilities are yet to be tested and perfected and the commitment from top executives on technology investments is also yet to be tested.  Another story is the seeming addiction of top executives to store openings and acquisitions as growth drivers.  JFC money may have gone to waste to acquisitions of loss-making companies.

The launch of the Jollibee app signals to the market that JFC is investing in technology to drive growth and is adapting to the present environment and the market has appreciated the initiative.  JFC is marrying its food offerings with technology to provide an even better consumer convenience.

Contrast that with ABS launching again on free tv, A2Z.  Initially ABS shares surge after the launching, but it soon waned. ABS shares are falling back to earth.  ABS touting its free tv comeback is no longer exciting.  

Free tv broadcast is slowly fading.  People’s habits and preferences have changed.  People want to watch the shows they want to watch at their own convenient time, not the shows you want them to watch and at the time you want them to watch.

No doubt ABS have superb and world-class content creation capabilities.  But distributing it the old-fashioned way through free tv broadcasting is no longer valued much by the market as free tv is slowly declining.  People now want to watch the shows they want to watch at their own convenient time, not the shows you want them to watch and at the time you want them to watch.

Lately, ABS has been touting its number of followers and views in YouTube and Facebook to the market.  A large presence in YouTube and Facebook does not mean ABS has become technology driven. It only means the Alphabet and Facebook have excellent platforms and the market should buy Alphabet and Facebook not ABS.

ABS should marry its studio with an intelligent streaming platform.  ABS should focus on investing and developing technology for streaming and curated content distribution.  

The keyword for an ABS surging could be curated content, artificial intelligence, streaming, and platform not free tv or A2Z. 

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Disclaimer and Disclosure: This is an independent analysis for discussion purposes with the aim of giving stock traders and investors an independent viewpoint.  Accuretti Systems Inc. in day to day trading may have owned, or is considering buying or disposing, the shares of the companies mentioned in this commentary.

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