ASX:ST1

Stock Analysis Report

Executive Summary

Spirit Telecom Limited provides telecommunication, high speed Internet, and ancillary services to commercial and residential customers in Australia.


Snowflake Analysis

High growth potential with adequate balance sheet.


Similar Companies

Share Price & News

How has Spirit Telecom's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: ST1's share price has been volatile over the past 3 months.


Market Performance


7 Day Return

-6.9%

ST1

-1.8%

AU Telecom

0.3%

AU Market


1 Year Return

-27.0%

ST1

-10.7%

AU Telecom

-22.9%

AU Market

Return vs Industry: ST1 underperformed the Australian Telecom industry which returned -10.6% over the past year.

Return vs Market: ST1 underperformed the Australian Market which returned -22.8% over the past year.


Shareholder returns

ST1IndustryMarket
7 Day-6.9%-1.8%0.3%
30 Day-30.8%-13.0%-27.8%
90 Day-35.7%-15.9%-30.0%
1 Year-27.0%-27.0%-7.5%-10.7%-19.4%-22.9%
3 Year-12.9%-12.9%-22.0%-32.9%-8.3%-20.8%
5 Yearn/a-34.9%-49.6%2.9%-20.3%

Price Volatility Vs. Market

How volatile is Spirit Telecom's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Spirit Telecom undervalued compared to its fair value and its price relative to the market?

1.63x

Price to Book (PB) ratio


Share Price vs. Fair Value

Below Fair Value: Insufficient data to calculate ST1's fair value to establish if it is undervalued.

Significantly Below Fair Value: Insufficient data to calculate ST1's fair value to establish if it is undervalued.


Price To Earnings Ratio

PE vs Industry: ST1 is unprofitable, so we can't compare its PE Ratio to the Telecom industry average.

PE vs Market: ST1 is unprofitable, so we can't compare its PE Ratio to the Australian market.


Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate ST1's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: ST1 is good value based on its PB Ratio (1.6x) compared to the AU Telecom industry average (1.8x).


Next Steps

Future Growth

How is Spirit Telecom forecast to perform in the next 1 to 3 years based on estimates from 2 analysts?

101.6%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: ST1 is forecast to become profitable over the next 3 years, which is considered faster growth than the savings rate (1.1%).

Earnings vs Market: ST1 is forecast to become profitable over the next 3 years, which is considered above average market growth.

High Growth Earnings: ST1's is expected to become profitable in the next 3 years.

Revenue vs Market: ST1's revenue (28.7% per year) is forecast to grow faster than the Australian market (4.2% per year).

High Growth Revenue: ST1's revenue (28.7% per year) is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: ST1's Return on Equity is forecast to be low in 3 years time (11.1%).


Next Steps

Past Performance

How has Spirit Telecom performed over the past 5 years?

22.2%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: ST1 is currently unprofitable.

Growing Profit Margin: ST1 is currently unprofitable.


Past Earnings Growth Analysis

Earnings Trend: ST1 is unprofitable, but has reduced losses over the past 5 years at a rate of 22.2% per year.

Accelerating Growth: Unable to compare ST1's earnings growth over the past year to its 5-year average as it is currently unprofitable

Earnings vs Industry: ST1 is unprofitable, making it difficult to compare its past year earnings growth to the Telecom industry (-8.9%).


Return on Equity

High ROE: ST1 has a negative Return on Equity (-3.54%), as it is currently unprofitable.


Next Steps

Financial Health

How is Spirit Telecom's financial position?


Financial Position Analysis

Short Term Liabilities: ST1's short term assets (A$4.9M) do not cover its short term liabilities (A$5.3M).

Long Term Liabilities: ST1's short term assets (A$4.9M) exceed its long term liabilities (A$4.5M).


Debt to Equity History and Analysis

Debt Level: ST1's debt to equity ratio (10.6%) is considered satisfactory.

Reducing Debt: ST1's debt to equity ratio has reduced from 101.1% to 10.6% over the past 5 years.


Balance Sheet

Inventory Level: ST1 has a high level of physical assets or inventory.

Debt Coverage by Assets: ST1's debt is covered by short term assets (assets are 1.6x debt).


Cash Runway Analysis

For companies that have on average been loss making in the past we assess whether they have at least 1 year of cash runway.

Stable Cash Runway: ST1 has less than a year of cash runway based on its current free cash flow.

Forecast Cash Runway: ST1 has sufficient cash runway for 1.1 years if free cash flow continues to reduce at historical rates of -30.9% each year.


Next Steps

Dividend

What is Spirit Telecom's current dividend yield, its reliability and sustainability?


Dividend Yield vs Market

Notable Dividend: Unable to evaluate ST1's dividend yield against the bottom 25% of dividend payers, as the company has not reported any payouts.

High Dividend: Unable to evaluate ST1's dividend yield against the top 25% of dividend payers, as the company has not reported any payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if ST1's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if ST1's dividend payments have been increasing.


Current Payout to Shareholders

Dividend Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: No need to calculate the sustainability of ST1's dividend in 3 years as they are not forecast to pay a notable one for the Australian market.


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

2.5yrs

Average management tenure


CEO

Sol Lukatsky

0.50

Tenure

AU$8,578,948

Compensation

Mr. Sol Lukatsky has been an Executive Director of Spirit Telecom Limited since June 21, 2019 and its Managing Director since September 2019. Mr. Lukatsky served as Chief Sales & Marketing Officer at Spiri ...


CEO Compensation Analysis

Compensation vs Market: Sol's total compensation ($USD5.26M) is above average for companies of similar size in the Australian market ($USD242.11K).

Compensation vs Earnings: Insufficient data to compare Sol's compensation with company performance.


Leadership Team

NamePositionTenureCompensationOwnership
Sol Lukatsky
MD & Executive Director0.50yrAU$8.58m0.69% A$325.7k
Mark Dioguardi
COO & Executive Director0.75yrAU$6.35m0.24% A$112.5k
Geoffrey Neate
Consultantno dataAU$441.05k9.96% A$4.7m
Paul Miller
Chief Financial Officer0.33yrno datano data
Dainen Keogh
Chief Infrastructure Officer2.5yrsno data1.01% A$472.5k
Melanie Jaye Leydin
Company Secretary3.75yrsno datano data
Joe Tigel
General Manager Strategic Sales2.75yrsno data9.69% A$4.5m

2.5yrs

Average Tenure

Experienced Management: ST1's management team is considered experienced (2.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Sol Lukatsky
MD & Executive Director0.50yrAU$8.58m0.69% A$325.7k
Mark Dioguardi
COO & Executive Director0.75yrAU$6.35m0.24% A$112.5k
Greg Ridder
Non-Executive Director0.33yrno data0.086% A$40.5k
James Joughin
Non-Executive Chairman3.75yrsAU$88.39k1.01% A$472.5k
Terence Gray
Non-Executive Director6.17yrsAU$68.39k0.19% A$89.9k

0.8yrs

Average Tenure

Experienced Board: ST1's board of directors are not considered experienced ( 0.8 years average tenure), which suggests a new board.


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: ST1 insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 25.9%.


Top Shareholders

Company Information

Spirit Telecom Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Spirit Telecom Limited
  • Ticker: ST1
  • Exchange: ASX
  • Founded:
  • Industry: Alternative Carriers
  • Sector: Telecom
  • Market Cap: AU$46.927m
  • Shares outstanding: 347.61m
  • Website: https://www.spirit.com.au

Location

  • Spirit Telecom Limited
  • 19-25 Raglan Street
  • Level 2
  • South Melbourne
  • Victoria
  • 3205
  • Australia

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
ST1ASX (Australian Securities Exchange)YesOrdinary SharesAUAUDJun 2016
ST1CHIA (Chi-X Australia)YesOrdinary SharesAUAUDJun 2016

Biography

Spirit Telecom Limited provides telecommunication, high speed Internet, and ancillary services to commercial and residential customers in Australia. It offers Internet services for apartments, connected communities, property developers, and students. The company also provides Managed IT Services, including enterprise grade managed Wi-Fi, cyber security, networking, disaster recovery, online backup, and desktop/laptop maintenance services, as well as infrastructure as a service. In addition, it offers unified communications and business voice solutions comprising Cloud UC solutions that build communications solutions for business based on Cloud UC platform; Smart SIP solution to make and take calls over Internet connections; and Smart ISDN solution for cloud transition. Further, the company provides phone name solutions. Spirit Telecom Limited is based in South Melbourne, Australia. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/28 10:37
End of Day Share Price2020/03/27 00:00
Earnings2019/12/31
Annual Earnings2019/06/30


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.