Homepage
PR Newswire
20-11-2016, 05:23 PM
Just sharing an article...
One stock is M1 (B2F.SG), the smallest of Singapore’s three telcos. Shares have dropped 25% in the past three months to trade below its five year average price-to-earnings multiple on concerns about a possible fourth telco operator.
However, Moermann argues Singaporean authorities may cancel or push back the award of a fourth telco license due to a lack of bidders with a strong track record of operating a local network.
Additionally, a fourth operator would add very little value to Singapore’s telco sector right now. In the event that a fourth license is awarded, Moermann argues the price competition wouldn’t be as intense as expected. He expects the new arrival would only have enough firepower to underprice incumbents by an average 7%.
The recent drop in M1’s share price - as well as a juicy 7.6% dividend yield - provides downside support, says Moermann. If a fourth telco doesn’t materialize, he expects M1 to quickly rebound to its recent average level of SGD2.50 a share, which implies 24% upside on its current level.
http://www.barrons.com/articles/activist...1479428932
One stock is M1 (B2F.SG), the smallest of Singapore’s three telcos. Shares have dropped 25% in the past three months to trade below its five year average price-to-earnings multiple on concerns about a possible fourth telco operator.
However, Moermann argues Singaporean authorities may cancel or push back the award of a fourth telco license due to a lack of bidders with a strong track record of operating a local network.
Additionally, a fourth operator would add very little value to Singapore’s telco sector right now. In the event that a fourth license is awarded, Moermann argues the price competition wouldn’t be as intense as expected. He expects the new arrival would only have enough firepower to underprice incumbents by an average 7%.
The recent drop in M1’s share price - as well as a juicy 7.6% dividend yield - provides downside support, says Moermann. If a fourth telco doesn’t materialize, he expects M1 to quickly rebound to its recent average level of SGD2.50 a share, which implies 24% upside on its current level.
http://www.barrons.com/articles/activist...1479428932