Alliance Global: revenue accelerated to +12.8% and profit rose 11.4% – growth is there, but the margin is not widening

In its Q3 2026 report, Alliance Global Group posted revenue of PHP 46,196.9 mn, operating profit of PHP 9,167.9 mn and net profit of PHP 6,263.7 mn. Revenue grew 12.8% year on year – faster than the 10.4% seen in Q2 – while net profit rose 11.4%. The net margin stayed at 13.6% versus 13.7% a year earlier, so top-line growth is not yet translating into margin expansion. Our conclusion: rather attractive – on the portal's model the share has +28% upside to fair value. Our view: the share is rather attractive at the current price; upside on the portal model +28%.

Our view: is there upside

Our view in numbers

Key takeaways

— Revenue accelerated to +12.8% year on year, but the net margin stayed at 13.6%

— Net profit rose 11.4% – slower than revenue, because the margin did not widen

— Leverage of 4.17x LTM EBITDA is a level, not an improvement

— P/E of 3.0 and EV/EBITDA of 5.6 are low, but the dividend yield is only 1.12%

— On the portal's model the share has +28% upside to fair value

Key figures, PHP bn

Revenue accelerated to +12.8% year on year, but the net margin stayed at 13.6%

In Q3 2026 revenue came to PHP 46,196.9 mn, up 12.8% year on year. That is an acceleration from Q2, when growth was 10.4%. After four quarters of decline – from -18.8% in Q1 2026 to -25.4% in Q4 2025 – the company has returned to double-digit growth.

Operating profit for the quarter was PHP 9,167.9 mn. Against revenue of 46,196.9 mn that implies an operating margin of about 19.8%. Net profit reached PHP 6,263.7 mn, with a net margin of 13.6% versus 13.7% a year earlier. The margin did not widen, so profit is growing more slowly than revenue.

For a holder this means business growth is not yet accompanied by efficiency gains. Revenue is accelerating, but each peso of sales brings the same profit as a year ago. The next report will show whether the company can convert growth into margin.

Net profit rose 11.4% – slower than revenue, because the margin did not widen

Net profit for Q3 2026 was PHP 6,263.7 mn, up 11.4% year on year. Revenue over the same period grew 12.8%. The 1.4 percentage point gap is explained by the net margin slipping from 13.7% to 13.6%.

Operating profit of PHP 9,167.9 mn on revenue of 46,196.9 mn implies an operating margin of about 19.8%. That is below Q2 2026, when revenue of 47,741.0 mn and operating profit of 13,558.8 mn implied a margin of about 28.4%. The quarter-on-quarter decline in operating margin is an important signal.

Profit is growing, but more slowly than revenue. If the operating margin keeps falling, profit growth could slow further. For now the company shows positive dynamics on both measures.

Leverage of 4.17x LTM EBITDA is a level, not an improvement

Net debt at the latest annual balance sheet was PHP 225,929.0 mn. The ratio of net debt to LTM EBITDA is 4.17. That is a level of leverage, not a change in it: the facts do not give a prior value for the ratio.

LTM EBITDA was PHP 54,143.9 mn on revenue of PHP 180,700.0 mn. Net profit over the same period was PHP 25,428.0 mn. Leverage of 4.17x EBITDA is meaningful but not critical for a company with positive operating profit.

For a holder, what matters is that the debt is serviced. With EBITDA of 54.1 bn pesos and net debt of 225.9 bn, the company can service its obligations, but debt growth without EBITDA growth could increase the burden.

P/E of 3.0 and EV/EBITDA of 5.6 are low, but the dividend yield is only 1.12%

Market capitalisation is PHP 77,156.8 mn. With LTM net profit of PHP 25,428.0 mn, that gives a P/E of 3.03. LTM EV/EBITDA is 5.60. Both multiples are low, pointing to undervaluation relative to earnings.

The trailing 12-month dividend yield is 1.12%. That is a modest level and does not offset the low valuation. ROE is 5.22% – also not high.

On the portal's model the share has +28% upside to fair value. This is our own calculation, not market consensus. Low multiples and upside make the share interesting, but the weak dividend yield limits its appeal for income investors.

On the portal's model the share has +28% upside to fair value

Our valuation model, based on EBITDA growth and a target multiple, shows +28% upside to the current market price. That corresponds to a 'rather attractive' rating on our scale.

The share is held in our live model strategies PH FVC (quality). This is a fact, not an argument for the verdict: membership follows each strategy's own screen.

The +28% upside is our own calculation. It does not account for possible one-offs or changes in dividend policy. For a holder it is a guide, not a guarantee.

Valuation on the latest reported figures

Bottom line

The strong point of the report was the return to double-digit revenue growth – +12.8% year on year, accelerating from Q2. However, profit rose only 11.4%, and the net margin stayed at 13.6%, without widening. Leverage of 4.17x EBITDA is a level, not an improvement. The key question for a holder is whether the company can convert revenue acceleration into margin growth. Our conclusion: rather attractive – on the portal's model the share has +28% upside. Our view: the share is rather attractive at the current price; upside on the portal model +28%.