SWX:SRCG

Stock Analysis Report

Sunrise Communications Group

Executive Summary

Sunrise Communications Group AG, together with its subsidiaries, provides telecommunications services to residential and business customers, and other carriers in Switzerland.

Rewards

Trading at 57.9% below its fair value

Earnings are forecast to grow 26.35% per year

Earnings grew by 49.7% over the past year

Risk Analysis

Dividend of 5.5% is not well covered by earnings or forecast to be in the next 3 years

Has a high level of debt



Snowflake Analysis

Proven track record with adequate balance sheet.


Similar Companies

Share Price & News

How has Sunrise Communications Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: SRCG has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-1.7%

SRCG

-1.5%

CH Telecom

-0.3%

CH Market


1 Year Return

-13.1%

SRCG

-2.6%

CH Telecom

18.5%

CH Market

Return vs Industry: SRCG underperformed the Swiss Telecom industry which returned -2.6% over the past year.

Return vs Market: SRCG underperformed the Swiss Market which returned 18.5% over the past year.


Shareholder returns

SRCGIndustryMarket
7 Day-1.7%-1.5%-0.3%
30 Day-3.8%-2.2%1.4%
90 Day-0.3%0.2%3.8%
1 Year-7.9%-13.1%2.4%-2.6%24.2%18.5%
3 Year39.1%19.3%6.2%-6.7%40.9%22.6%
5 Yearn/a2.7%-17.1%39.6%17.8%

Price Volatility Vs. Market

How volatile is Sunrise Communications Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Sunrise Communications Group undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: SRCG (CHF76.3) is trading below our estimate of fair value (CHF181.14)

Significantly Below Fair Value: SRCG is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: SRCG is poor value based on its PE Ratio (24x) compared to the Telecom industry average (20.4x).

PE vs Market: SRCG is poor value based on its PE Ratio (24x) compared to the Swiss market (20x).


Price to Earnings Growth Ratio

PEG Ratio: SRCG is good value based on its PEG Ratio (0.9x)


Price to Book Ratio

PB vs Industry: SRCG is overvalued based on its PB Ratio (2.5x) compared to the XE Telecom industry average (1.8x).


Next Steps

Future Growth

How is Sunrise Communications Group forecast to perform in the next 1 to 3 years based on estimates from 10 analysts?

26.3%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SRCG's forecast earnings growth (26.3% per year) is above the savings rate (-0.6%).

Earnings vs Market: SRCG's earnings (26.3% per year) are forecast to grow faster than the Swiss market (10.6% per year).

High Growth Earnings: earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: SRCG's revenue (0.8% per year) is forecast to grow slower than the Swiss market (3.5% per year).

High Growth Revenue: SRCG's revenue (0.8% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SRCG's Return on Equity is forecast to be low in 3 years time (10.4%).


Next Steps

Past Performance

How has Sunrise Communications Group performed over the past 5 years?

50.0%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SRCG has high quality earnings.

Growing Profit Margin: SRCG's current net profit margins (7.7%) are higher than last year (5%).


Past Earnings Growth Analysis

Earnings Trend: SRCG has become profitable over the past 5 years, growing earnings by 50% per year.

Accelerating Growth: SRCG's earnings growth over the past year (49.7%) is below its 5-year average (50% per year).

Earnings vs Industry: SRCG earnings growth over the past year (49.7%) exceeded the Telecom industry 1.4%.


Return on Equity

High ROE: SRCG's Return on Equity (10.5%) is considered low.


Return on Assets


Return on Capital Employed


Next Steps

Financial Health

How is Sunrise Communications Group's financial position?


Financial Position Analysis

Short Term Liabilities: SRCG's short term assets (CHF775.3M) exceed its short term liabilities (CHF631.1M).

Long Term Liabilities: SRCG's short term assets (CHF775.3M) do not cover its long term liabilities (CHF2.1B).


Debt to Equity History and Analysis

Debt Level: SRCG's debt to equity ratio (115.3%) is considered high.

Reducing Debt: SRCG's debt to equity ratio has reduced from 351% to 115.3% over the past 5 years.

Debt Coverage: SRCG's debt is well covered by operating cash flow (34.6%).

Interest Coverage: SRCG's interest payments on its debt are well covered by EBIT (4x coverage).


Balance Sheet

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

Debt Coverage by Assets: SRCG's debt is not covered by short term assets (assets are 0.5x debt).


Next Steps

Dividend

What is Sunrise Communications Group's current dividend yield, its reliability and sustainability?

5.50%

Current Dividend Yield


Dividend Yield vs Market

company5.5%marketbottom25%1.7%markettop25%3.5%industryaverage4.9%forecastin3Years6.1%

Current dividend yield vs market & industry

Notable Dividend: SRCG's dividend (5.5%) is higher than the bottom 25% of dividend payers in the Swiss market (1.73%).

High Dividend: SRCG's dividend (5.5%) is in the top 25% of dividend payers in the Swiss market (3.53%)


Stability and Growth of Payments

Stable Dividend: Whilst dividend payments have been stable, SRCG has been paying a dividend for less than 10 years.

Growing Dividend: SRCG's dividend payments have increased, but the company has only paid a dividend for 4 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (132%), SRCG's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SRCG's dividends in 3 years are not forecast to be well covered by earnings (138% payout ratio).


Next Steps

Management

What is the CEO of Sunrise Communications Group's salary, the management and board of directors tenure and is there insider trading?

3.0yrs

Average management tenure


CEO

Olaf Swantee (53yo)

3.6yrs

Tenure

CHF2,191,000

Compensation

Mr. Olaf Swantee servedas Director of T-Mobile US, Inc. since June 13, 2018 until June 2019. He has been Chief Executive Officer and Member of Management Board at Sunrise Communications Group AG since May  ...


CEO Compensation Analysis

Compensation vs Market: Olaf's total compensation ($USD2.23M) is about average for companies of similar size in the Swiss market ($USD1.74M).

Compensation vs Earnings: Olaf's compensation has been consistent with company performance over the past year.


Management Age and Tenure

3.0yrs

Average Tenure

52yo

Average Age

Experienced Management: SRCG's management team is considered experienced (3 years average tenure).


Board Age and Tenure

3.7yrs

Average Tenure

62yo

Average Age

Experienced Board: SRCG's board of directors are considered experienced (3.7 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Management Team

  • Bruno Duarte (53yo)

    Chief Consumer Officer & Member of Management Board

    • Tenure: 2.5yrs
  • Elmar Grasser (54yo)

    CTO & Member of Management Board

    • Tenure: 0yrs
  • Carl Wich

    Head of Business Customers Unit

    • Tenure: 12.9yrs
  • Olaf Swantee (53yo)

    CEO & Member of Management Board

    • Tenure: 3.6yrs
    • Compensation: CHF2.19m
  • André Krause (49yo)

    CFO & Member of Management Board

    • Tenure: 8.9yrs
  • Françoise Clemes (52yo)

    Chief Services Officer & Member of Management Board

    • Tenure: 3.5yrs
  • Patrick Meier (37yo)

    Director of Legal

    • Tenure: 1.3yrs
  • Uwe Schiller

    Senior Vice President of Investor Relations

    • Tenure: 0yrs
  • Marcel Huber

    Chief Administrative Officer

    • Tenure: 0.8yrs
  • Tobias Foster (44yo)

    Chief HR Officer & Member of the Executive Leadership Team

    • Tenure: 0.9yrs

Board Members

  • Peter Kurer (70yo)

    Chairman of the Board of Directors

    • Tenure: 3.7yrs
    • Compensation: CHF381.00k
  • Jens Ovesen (62yo)

    Non-Executive Director

    • Tenure: 4.9yrs
    • Compensation: CHF163.00k
  • Michael Krammer (62yo)

    Non-Executive Director

    • Tenure: 3.7yrs
    • Compensation: CHF130.00k
  • Robin Bienenstock (51yo)

    Non-Executive Director

    • Tenure: 3.7yrs
    • Compensation: CHF139.00k
  • Christoph Vilanek (51yo)

    Non-Executive Director

    • Tenure: 3.7yrs
    • Compensation: CHF130.00k
  • Ingrid Deltenre (59yo)

    Non-Executive Director

    • Tenure: 1.7yrs
    • Compensation: CHF118.00k
  • Ingo Arnold

    Director

    • Tenure: 0.7yrs
  • Peter Schöpfer (62yo)

    Vice Chairman

    • Tenure: 4.4yrs
    • Compensation: CHF161.00k

Company Information

Sunrise Communications Group AG's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Sunrise Communications Group AG
  • Ticker: SRCG
  • Exchange: SWX
  • Founded: 2015
  • Industry: Integrated Telecommunication Services
  • Sector: Telecom
  • Market Cap: CHF3.439b
  • Shares outstanding: 45.07m
  • Website: https://www.sunrise.ch

Number of Employees


Location

  • Sunrise Communications Group AG
  • Binzmühlestrasse 130
  • Zürich
  • Zurich
  • 8050
  • Switzerland

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SRCGSWX (SIX Swiss Exchange)YesCommon SharesCHCHFFeb 2015
SR2DB (Deutsche Boerse AG)YesCommon SharesDEEURFeb 2015
0R5GLSE (London Stock Exchange)YesCommon SharesGBCHFFeb 2015
SNMM.FOTCPK (Pink Sheets LLC)YesCommon SharesUSUSDFeb 2015

Biography

Sunrise Communications Group AG, together with its subsidiaries, provides telecommunications services to residential and business customers, and other carriers in Switzerland. The company offers mobile voi ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/12/14 21:38
End of Day Share Price2019/12/13 00:00
Earnings2019/09/30
Annual Earnings2018/12/31


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.