Singapore Stock Market News

StarHub - A starry 3Q12 performance

StockFanatic
Publish date: Mon, 05 Nov 2012, 09:59 AM
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StarHub's 9M12 annualised results were 7% above our forecast and 8% above consensus estimates due to lower traffic costs. 4Q12 EBITDA margins could surprise positively as subscriber acquisition costs (SAC) are contained. But mobile and payTV churns may rise due to rivalry.

StarHub declared a 5 ct DPS, as expected. We raise our DCF-based target price (WACC 7.8%) from $3.90 to S$4.35 as we roll it over to end-13 and up FY12-14 earnings by 1-5% to account for the margin surprise. StarHub remains an Outperform and our top Singapore telco pick, with a likely catalyst being an expected increase in FY13 dividends.
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