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SCOM

SafaricomNASE:SCOM Stock Report

Market Cap

KSh1.7t

7D

0.1%

1Y

38.7%

Updated

21 Oct, 2021

Data

Company Financials +
SCOM fundamental analysis
Snowflake Score
Valuation0/6
Future Growth1/6
Past Performance3/6
Financial Health4/6
Dividends5/6

SCOM Overview

Safaricom PLC provides telecommunication services in Kenya.

Rewards

Pays a reliable dividend of 4.33%

Risk Analysis

No risks detected for SCOM from our risk checks.

Safaricom Competitors

Amazon.com

NasdaqGS:AMZN

US$1.7t

Mastercard

NYSE:MA

US$351.5b

PayPal Holdings

NasdaqGS:PYPL

US$285.8b

Orange

ENXTPA:ORA

€25.6b

Price History & Performance

Summary of all time highs, changes and price drops for Safaricom
Historical stock prices
Current Share PriceKSh42.50
52 Week HighKSh30.00
52 Week LowKSh45.25
Beta0.52
1 Month Change1.68%
3 Month Change-0.70%
1 Year Change38.66%
3 Year Change80.85%
5 Year Change113.03%
Change since IPO478.23%

Recent News & Updates

Shareholder Returns

SCOMKE Wireless TelecomKE Market
7D0.1%-1.5%0.1%
1Y38.7%43.0%28.0%

Return vs Industry: SCOM underperformed the KE Wireless Telecom industry which returned 45.1% over the past year.

Return vs Market: SCOM exceeded the KE Market which returned 28.2% over the past year.

Price Volatility

Is SCOM's price volatile compared to industry and market?
SCOM volatility
SCOM Beta0.52
Industry Beta0.49
Market Beta1

Stable Share Price: SCOM is less volatile than 75% of KE stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: SCOM's weekly volatility (3%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
19934,436Peter Ndegwahttps://www.safaricom.co.ke

Safaricom PLC provides telecommunication services in Kenya. It provides voice, mobile data, and M-PESA payment, as well as home fiber services; mobile, fixed line, and Website and email services; and corporate internet, calling, and cloud and hosting services. The company also offers DigiFarm, an integrated mobile platform that offers farmers with a suite of products, including financial and credit services, farm products, and customized information on farming best practices; and operates Masoko, an e-commerce portal.

Safaricom Fundamentals Summary

How do Safaricom's earnings and revenue compare to its market cap?
SCOM fundamental statistics
Market CapKSh1.70t
Earnings (TTM)KSh68.68b
Revenue (TTM)KSh263.99b

24.8x

P/E Ratio

6.5x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
SCOM income statement (TTM)
RevenueKSh263.99b
Cost of RevenueKSh82.02b
Gross ProfitKSh181.97b
ExpensesKSh113.29b
EarningsKSh68.68b

Last Reported Earnings

Mar 31, 2021

Next Earnings Date

n/a

Earnings per share (EPS)1.71
Gross Margin68.93%
Net Profit Margin26.01%
Debt/Equity Ratio10.7%

How did SCOM perform over the long term?

See historical performance and comparison

Dividends

4.3%

Current Dividend Yield

80%

Payout Ratio

Valuation

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

24.79x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: SCOM (KES42.5) is trading above our estimate of fair value (KES23.76)

Significantly Below Fair Value: SCOM is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: SCOM is poor value based on its PE Ratio (24.8x) compared to the African Wireless Telecom industry average (19.1x).

PE vs Market: SCOM is poor value based on its PE Ratio (24.8x) compared to the KE market (6.7x).


Price to Earnings Growth Ratio

PEG Ratio: SCOM is poor value based on its PEG Ratio (2.2x)


Price to Book Ratio

PB vs Industry: SCOM is overvalued based on its PB Ratio (12.4x) compared to the XF Wireless Telecom industry average (4.1x).


Future Growth

How is Safaricom forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

11.4%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: SCOM's forecast earnings growth (11.4% per year) is below the savings rate (12.6%).

Earnings vs Market: SCOM's earnings (11.4% per year) are forecast to grow slower than the KE market (13.8% per year).

High Growth Earnings: SCOM's earnings are forecast to grow, but not significantly.

Revenue vs Market: SCOM's revenue (8.5% per year) is forecast to grow slower than the KE market (9.5% per year).

High Growth Revenue: SCOM's revenue (8.5% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: SCOM's Return on Equity is forecast to be very high in 3 years time (46.1%).


Past Performance

How has Safaricom performed over the past 5 years?

11.9%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: SCOM has high quality earnings.

Growing Profit Margin: SCOM's current net profit margins (26%) are lower than last year (28.1%).


Past Earnings Growth Analysis

Earnings Trend: SCOM's earnings have grown by 11.9% per year over the past 5 years.

Accelerating Growth: SCOM's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: SCOM had negative earnings growth (-6.8%) over the past year, making it difficult to compare to the Wireless Telecom industry average (-6.8%).


Return on Equity

High ROE: SCOM's Return on Equity (49.9%) is considered outstanding.


Financial Health

How is Safaricom's financial position?


Financial Position Analysis

Short Term Liabilities: SCOM's short term assets (KES55.9B) do not cover its short term liabilities (KES75.5B).

Long Term Liabilities: SCOM's short term assets (KES55.9B) exceed its long term liabilities (KES17.5B).


Debt to Equity History and Analysis

Debt Level: SCOM's debt to equity ratio (10.7%) is considered satisfactory.

Reducing Debt: SCOM's debt to equity ratio has increased from 0.2% to 10.7% over the past 5 years.

Debt Coverage: SCOM's debt is well covered by operating cash flow (713.4%).

Interest Coverage: SCOM's interest payments on its debt are well covered by EBIT (46x coverage).


Balance Sheet


Dividend

What is Safaricom current dividend yield, its reliability and sustainability?

4.33%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: SCOM's dividend (4.33%) is higher than the bottom 25% of dividend payers in the KE market (4.16%).

High Dividend: SCOM's dividend (4.33%) is low compared to the top 25% of dividend payers in the KE market (7.89%).


Stability and Growth of Payments

Stable Dividend: SCOM's dividends per share have been stable in the past 10 years.

Growing Dividend: SCOM's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (79.9%), SCOM's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: SCOM's dividends in 3 years are forecast to be covered by earnings (81.5% payout ratio).


Next Steps

Management

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

3.8yrs

Average management tenure


CEO

Peter Ndegwa (52 yo)

1.5yrs

Tenure

KSh201,540,000

Compensation

Mr. Peter Waititu Ndegwa has been Chief Executive Officer and Executive Director of Safaricom PLC since April 1, 2020. He serves as the Chief Executive Officer of Safaricom PLC at Vodacom Group Limited sin...


CEO Compensation Analysis

Compensation vs Market: Peter's total compensation ($USD1.81M) is about average for companies of similar size in the KE market ($USD2.42M).

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


Leadership Team

Experienced Management: SCOM's management team is considered experienced (3.8 years average tenure).


Board Members

Experienced Board: SCOM's board of directors are not considered experienced ( 1.6 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: 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.


Top Shareholders

Company Information

Safaricom PLC's employee growth, exchange listings and data sources


Key Information

  • Name: Safaricom PLC
  • Ticker: SCOM
  • Exchange: NASE
  • Founded: 1993
  • Industry: Wireless Telecommunication Services
  • Sector: Telecom
  • Market Cap: KSh1.703t
  • Shares outstanding: 40.07b
  • Website: https://www.safaricom.co.ke

Number of Employees


Location

  • Safaricom PLC
  • Safaricom House
  • Waiyaki Way
  • Nairobi
  • 800
  • Kenya

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/10/21 18:06
End of Day Share Price2021/10/21 00:00
Earnings2021/03/31
Annual Earnings2021/03/31


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.