Hites Posts Weekly Gain in Chile on Index Entry, Ratios

Empresas Hites SA, a Chilean department store operator, climbed to the highest in 17 months on speculation the company’s valuation is attractive compared with competitors in the country.

Hites advanced 2.1 percent to 480 pesos at the close in Santiago, its highest price on a closing basis since Aug. 2011. In the last week the stock has gained 7.7 percent, its biggest weekly gain since Nov. 9. The stock has increased 17 percent this year, the best start since it began trading in 2009.

“It’s currently the cheapest Chilean retailer” in terms of its price-earnings ratio, Juan Pablo Castillo, an analyst at Santiago-based Banco Penta, said in a phone interview. The stock was also “overly punished” after an accounting scandal at rival Empresas La Polar SA undermined investor confidence in the industry, he said.

Hites trades at 13.6 times price-to-earnings ratio. Peers Ripley Corp SA trades at 27 times, SACI Falabella is valued at 34 times and Cencosud SA trades at 25 times, according to data compiled by Bloomberg.

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