Singapore Stock Market News

StarHub - Still a Weak Twinkle

StockFanatic
Publish date: Wed, 27 Jun 2018, 04:24 PM
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Maintain NEUTRAL with lower DCF-derived TP of SGD1.90 (WACC: 7.5%, TG: 1.5%) from SGD2.50, 10% upside and backed by >9% dividend yield in 2018F. We cut our FY18F-20F core earnings by 8-16%, factoring in weaker pay-TV revenues, higher ARPU dilution from MVNO aggression/take-up of SIM-only plans, and weaker EBITDA margin as a whole. StarHub is the worst performing telco on the FSSTI, down 39% YTD on concerns over mobile competition, with valuations at -2SD below historical EV/EBITDA mean. Prefer Singtel (ST SP, BUY, TP: SGD4.05) for sector exposure.
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