Why You Should Care About Activation Group Holdings' (HKG:9919) Strong Returns On Capital
Dec 05
Hong Kong (HSI) Telecom Sector Analysis
UpdatedDec 06, 2023
DataAggregated Company Financials
Companies143
- 7D-2.3%
- 3M-5.9%
- 1Y2.3%
- YTD-4.3%
Over the last 7 days, the Telecom industry has dropped 2.3%, driven by a pullback from Tencent Holdings of 3.4%. Meanwhile, Meitu actually outperformed within the industry, gaining 6.3% in the last week. As for the longer term, the industry's performance has been flat for the past year. Earnings are forecast to grow by 10.0% annually.
Sector Valuation and Performance
Has the Hong Kong Telecom Sector valuation changed over the past few years?
| Date | Market Cap | Revenue | Earnings | PE | Absolute PE | PS |
|---|---|---|---|---|---|---|
| Wed, 06 Dec 2023 | HK$5.7t | HK$3.2t | HK$425.8b | 12.5x | 13.3x | 1.8x |
| Fri, 03 Nov 2023 | HK$5.5t | HK$3.1t | HK$409.3b | 10.5x | 13.4x | 1.8x |
| Sun, 01 Oct 2023 | HK$5.9t | HK$3.1t | HK$408.4b | 11.5x | 14.4x | 1.9x |
| Tue, 29 Aug 2023 | HK$6.1t | HK$3.1t | HK$405.2b | 11.7x | 15x | 2x |
| Thu, 27 Jul 2023 | HK$6.3t | HK$3.1t | HK$388.6b | 13.2x | 16.1x | 2x |
| Sat, 24 Jun 2023 | HK$6.1t | HK$3.1t | HK$388.1b | 14x | 15.7x | 2x |
| Mon, 22 May 2023 | HK$6.2t | HK$3.1t | HK$391.3b | 14.8x | 15.9x | 2x |
| Wed, 19 Apr 2023 | HK$6.7t | HK$3.1t | HK$393.6b | 15.5x | 17.1x | 2.1x |
| Fri, 17 Mar 2023 | HK$6.2t | HK$3.1t | HK$383.4b | 11x | 16.2x | 2x |
| Sun, 12 Feb 2023 | HK$6.4t | HK$3.1t | HK$392.5b | 11.7x | 16.4x | 2x |
| Tue, 10 Jan 2023 | HK$6.1t | HK$3.1t | HK$392.0b | 11.8x | 15.5x | 1.9x |
| Thu, 08 Dec 2022 | HK$5.3t | HK$3.0t | HK$378.7b | 9.8x | 14x | 1.8x |
| Sat, 05 Nov 2022 | HK$4.4t | HK$2.9t | HK$368.1b | 10.2x | 12x | 1.5x |
| Mon, 03 Oct 2022 | HK$4.8t | HK$3.0t | HK$375.0b | 11.1x | 12.7x | 1.6x |
| Wed, 31 Aug 2022 | HK$5.6t | HK$3.0t | HK$383.6b | 11.9x | 14.5x | 1.8x |
| Fri, 29 Jul 2022 | HK$5.6t | HK$3.0t | HK$400.7b | 9.2x | 13.9x | 1.8x |
| Sun, 26 Jun 2022 | HK$6.2t | HK$3.1t | HK$405.3b | 10.3x | 15.2x | 2x |
| Tue, 24 May 2022 | HK$5.8t | HK$3.1t | HK$344.8b | 10.6x | 16.8x | 1.9x |
| Thu, 21 Apr 2022 | HK$6.0t | HK$3.1t | HK$385.6b | 10.9x | 15.6x | 1.9x |
| Sat, 19 Mar 2022 | HK$6.2t | HK$3.1t | HK$325.2b | 9.7x | 19x | 2x |
| Mon, 14 Feb 2022 | HK$7.4t | HK$3.1t | HK$322.2b | 11.1x | 22.8x | 2.4x |
| Wed, 12 Jan 2022 | HK$7.1t | HK$3.1t | HK$321.0b | 10x | 22x | 2.3x |
| Fri, 10 Dec 2021 | HK$7.0t | HK$3.1t | HK$322.9b | 10.9x | 21.8x | 2.3x |
| Sun, 07 Nov 2021 | HK$7.1t | HK$3.0t | HK$291.6b | 11.3x | 24.2x | 2.3x |
| Tue, 05 Oct 2021 | HK$6.8t | HK$3.0t | HK$284.3b | 10.8x | 24.1x | 2.3x |
| Thu, 02 Sep 2021 | HK$7.3t | HK$2.9t | HK$281.4b | 13.4x | 26x | 2.5x |
| Sat, 31 Jul 2021 | HK$7.0t | HK$2.9t | HK$281.4b | 11.8x | 25x | 2.4x |
| Tue, 04 May 2021 | HK$9.2t | HK$2.8t | HK$218.7b | 13.7x | 42.1x | 3.3x |
| Fri, 05 Feb 2021 | HK$8.5t | HK$2.6t | HK$360.6b | 14x | 23.5x | 3.2x |
Price to Earnings Ratio
20.1x
Current Industry PE
- Investors are pessimistic on the Hong Kong Communication Services industry, indicating that they anticipate long term growth rates will be lower than they have historically.
- The industry is trading at a PE ratio of 13.3x which is lower than its 3-year average PE of 20.0x.
- The 3-year average PS ratio of 2.2x is higher than the industry's current PS ratio of 1.8x.
Past Earnings Growth
- The earnings for companies in the Communication Services industry have grown 5.7% per year over the last three years.
- Revenues for these companies have grown 6.8% per year.
- This means that more sales are being generated by these companies overall, and subsequently their profits are increasing too.
Industry Trends
Which industries have driven the changes within the Hong Kong Telecom sector?
| HK Market | -4.20% | |
| Telecom | -2.33% | |
| Telecom Services and Carriers | -0.44% | |
| Wireless Telecom | -0.64% | |
| Interactive Media and Services | -3.40% | |
| Media | -4.03% | |
| Entertainment | -4.58% | |
Industry PE
- Investors are most optimistic about the Media industry which is trading above its 3-year average PE ratio.
- Analysts are expecting annual earnings growth of 24.1%, which is higher than its past year's earnings decline of 11.8% per year.
Forecasted Growth
- Analysts are most optimistic on the Entertainment industry, expecting annual earnings growth of 52% over the next 5 years.
- This is better than its past earnings decline of 19% per year.
- In contrast, the Wireless Telecom industry is expected to see its earnings grow by 6.5% per year over the next few years.
Top Stock Gainers and Losers
Which companies have driven the market over the last 7 days?
| Company | Last Price | 7D | 1Y | Valuation | |
|---|---|---|---|---|---|
| 728 China Telecom | HK$3.54 | 0.6% +HK$1.8b | 11.0% | PE9.8x | |
| 1357 Meitu | HK$3.57 | 6.3% +HK$933.9m | 197.5% | PE24.7x | |
| 777 NetDragon Websoft Holdings | HK$14.76 | 5.1% +HK$382.5m | -9.8% | PE9.3x | |
| 6820 FriendTimes | HK$1.37 | 5.4% +HK$152.7m | 41.2% | PE159.4x | |
| 6610 Flowing Cloud Technology | HK$1.92 | 4.3% +HK$144.0m | -56.6% | PE11.7x |
