NZSE:CNU

Stock Analysis Report

Executive Summary

Chorus Limited, together with its subsidiaries, provides fixed line communications infrastructure services in New Zealand.

Snowflake

Fundamentals

Overvalued with concerning outlook.

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

1.5%

CNU

0.1%

NZ Telecom

1.1%

NZ Market


1 Year Return

11.6%

CNU

7.2%

NZ Telecom

19.1%

NZ Market

Return vs Industry: CNU exceeded the NZ Telecom industry which returned 7.2% over the past year.

Return vs Market: CNU underperformed the NZ Market which returned 19.1% over the past year.


Shareholder returns

CNUIndustryMarket
7 Day1.5%0.1%1.1%
30 Day1.5%-1.5%2.7%
90 Day-0.2%-2.1%1.9%
1 Year17.3%11.6%11.8%7.2%24.3%19.1%
3 Year72.9%46.2%-8.9%-22.7%55.8%35.5%
5 Year228.2%161.2%-1.8%-24.8%101.8%56.4%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

44.16x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: CNU (NZ$5.38) is trading above our estimate of fair value (NZ$5.31)

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


Price To Earnings Ratio

PE vs Industry: CNU is poor value based on its PE Ratio (44.2x) compared to the Telecom industry average (34.2x).

PE vs Market: CNU is poor value based on its PE Ratio (44.2x) compared to the NZ market (18.7x).


Price to Earnings Growth Ratio

PEG Ratio: CNU is poor value based on its PEG Ratio (7.4x)


Price to Book Ratio

PB vs Industry: CNU is good value based on its PB Ratio (2.4x) compared to the XO Telecom industry average (2.5x).


Next Steps

Future Growth

How is Chorus forecast to perform in the next 1 to 3 years based on estimates from 6 analysts?

6.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: CNU's forecast earnings growth (6% per year) is above the savings rate (2.4%).

Earnings vs Market: CNU's earnings (6% per year) are forecast to grow slower than the NZ market (7% per year).

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

Revenue vs Market: CNU's revenue is expected to decline over the next 3 years (-0.01% per year).

High Growth Revenue: CNU's revenue is forecast to decline over the next 3 years (-0.01% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: CNU's Return on Equity is forecast to be low in 3 years time (6.4%).


Next Steps

Past Performance

How has Chorus performed over the past 5 years?

-11.6%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: CNU's earnings have declined by -11.6% per year over the past 5 years.

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

Earnings vs Industry: CNU had negative earnings growth (-37.6%) over the past year, making it difficult to compare to the Telecom industry average (-37.6%).


Return on Equity

High ROE: CNU's Return on Equity (5.4%) is considered low.


Return on Assets

ROA vs Industry: CNU's Return on Assets is below or equal to the Telecom industry average last year.


Return on Capital Employed

ROCE Improving: CNU's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Chorus's financial position?


Financial Position Analysis

Short Term Liabilities: CNU's short term assets (NZ$433.0M) do not cover its short term liabilities (NZ$1.1B)

Long Term Liabilities: CNU's short term assets (433.0M) do not cover its long term liabilities (3.6B)


Debt to Equity History and Analysis

Debt Level: CNU's debt to equity ratio (293.7%) is considered high

Reducing Debt: CNU's debt to equity ratio has increased from 252.4% to 293.7% over the past 5 years.

Debt Coverage: CNU's debt is not well covered by operating cash flow (17.3%).

Interest Coverage: CNU's interest payments on its debt are not well covered by EBIT (1.5x coverage).


Balance Sheet

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

Debt Coverage by Assets: CNU's debt is not covered by short term assets (assets are 0.2x debt).


Next Steps

Dividend

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

4.28%

Current Dividend Yield


Dividend Yield vs Market

company4.3%marketbottom25%3.0%markettop25%5.6%industryaverage4.2%forecastin3Years4.7%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: CNU's dividend (4.28%) is higher than the bottom 25% of dividend payers in the NZ market (3%).

High Dividend: CNU's dividend (4.28%) is low compared to the top 25% of dividend payers in the NZ market (5.56%).

Stable Dividend: CNU has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: CNU's dividend payments have increased, but the company has only paid a dividend for 7 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (188.8%), CNU's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: CNU's dividends in 3 years are not forecast to be well covered by earnings (191.6% payout ratio).


Next Steps

Management

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

1.3yrs

Average management tenure


CEO

Kate McKenzie 0

2.8yrs

Tenure

NZ$2,068,560

Compensation

Ms. Kate M. McKenzie, B.A., L.L.B. has been the Chief Executive Officer at Chorus Limited since December 2016 and Managing Director at Chorus Limited since February 20, 2017. She has been a Non-independen ...


CEO Compensation Analysis

Compensation vs. Market: Kate's total compensation ($USD1.32M) is about average for companies of similar size in the NZ market ($USD1.23M).

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


Management Age and Tenure

1.3yrs

Average Tenure

Experienced Management: CNU's management team is not considered experienced ( 1.3 years average tenure), which suggests a new team.


Board Age and Tenure

4.1yrs

Average Tenure

Experienced Board: CNU's board of directors are considered experienced (4.1 years average tenure).


Insider Trading

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


Recent Insider Transactions

BuyNZ$6,234,88117 Oct 19
Colonial First State Asset Management (Australia) Limited
EntityCompany
Shares1,144,388
Max PriceNZ$5.90
BuyNZ$15,304,97217 Oct 19
ASB Group Investments Ltd.
EntityCompany
Shares2,834,995
Max PriceNZ$5.63
SellNZ$8,441,09617 Oct 19
Colonial First State Asset Management (Australia) Limited
EntityCompany
Shares1,483,276
Max PriceNZ$5.98
SellNZ$6,468,37124 Sep 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares1,245,470
Max PriceNZ$5.38
BuyNZ$3,718,74024 Sep 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares727,125
Max PriceNZ$5.35
SellNZ$897,34224 Sep 19
Realindex Investments Pty Limited
EntityCompany
Shares178,091
Max PriceNZ$5.04
BuyNZ$50,03724 Sep 19
Realindex Investments Pty Limited
EntityCompany
Shares10,126
Max PriceNZ$5.02
SellNZ$16,266,74311 Sep 19
Accident Compensation Corporation, Asset Management Arm
EntityCompany
Shares2,812,969
Max PriceNZ$5.78
BuyNZ$30,888,39711 Sep 19
Accident Compensation Corporation, Asset Management Arm
EntityCompany
Shares5,770,837
Max PriceNZ$5.41
BuyNZ$25,40004 Sep 19
Anne Urlwin
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares5,000
Max PriceNZ$5.08
BuyNZ$400,00204 Sep 19
Murray Jordan
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares78,438
Max PriceNZ$5.10
BuyNZ$3,145,44904 Sep 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares618,077
Max PriceNZ$5.13
BuyNZ$25,76004 Sep 19
Realindex Investments Pty Limited
EntityCompany
Shares5,115
Max PriceNZ$5.04
SellNZ$870,46825 Aug 19
Realindex Investments Pty Limited
EntityCompany
Shares166,781
Max PriceNZ$5.22
SellNZ$351,38325 Aug 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares67,206
Max PriceNZ$5.23
BuyNZ$658,54425 Aug 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares125,894
Max PriceNZ$5.23
BuyNZ$4,06523 Aug 19
Realindex Investments Pty Limited
EntityCompany
Shares793
Max PriceNZ$5.13
SellNZ$4,06523 Aug 19
Realindex Investments Pty Limited
EntityCompany
Shares793
Max PriceNZ$5.13
BuyNZ$450,87123 Aug 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares88,096
Max PriceNZ$5.12
BuyNZ$34,126,61808 Aug 19
Morgan Stanley, Investment Banking and Brokerage Investments
EntityCompany
Shares6,065,497
Max PriceNZ$6.00
BuyNZ$008 Aug 19
Realindex Investments Pty Limited
EntityCompany
Shares997,058
Max PriceNZ$5.95
BuyNZ$14,793,15205 Aug 19
Colonial First State Asset Management (Australia) Limited
EntityCompany
Shares2,913,158
Max PriceNZ$5.28
BuyNZ$10,129,53005 Aug 19
ASB Group Investments Ltd.
EntityCompany
Shares2,017,833
Max PriceNZ$5.02
SellNZ$2,999,16905 Aug 19
ASB Group Investments Ltd.
EntityCompany
Shares580,099
Max PriceNZ$5.17
SellNZ$17,588,30505 Aug 19
Colonial First State Asset Management (Australia) Limited
EntityCompany
Shares3,403,208
Max PriceNZ$5.42
BuyNZ$36,95705 Jul 19
Jonathan Hartley
EntityIndividual
Role
Vice Chairman
Deputy Chairman
Shares35,000
Max PriceNZ$1.06
BuyNZ$14,58203 Apr 19
Prudence Flacks
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares2,480
Max PriceNZ$5.88
BuyNZ$58,80003 Apr 19
Andrew Cross
EntityIndividual
Role
Member of the Board of Directors
Independent Non-Executive Director
Shares10,000
Max PriceNZ$5.88
BuyNZ$52,19905 Mar 19
Jack Matthews
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares10,000
Max PriceNZ$5.22
SellNZ$4,746,95214 Feb 19
Accident Compensation Corporation, Asset Management Arm
EntityCompany
Shares932,365
Max PriceNZ$5.09
BuyNZ$3,527,76714 Feb 19
Accident Compensation Corporation, Asset Management Arm
EntityCompany
Shares748,674
Max PriceNZ$4.71
SellNZ$12,608,07319 Nov 18
Orbis Investment Management Limited
EntityCompany
Shares2,704,158
Max PriceNZ$4.70
SellNZ$3,335,51514 Nov 18
Accident Compensation Corporation, Asset Management Arm
EntityCompany
Shares670,696
Max PriceNZ$4.97
BuyNZ$1,660,14514 Nov 18
Accident Compensation Corporation, Asset Management Arm
EntityCompany
Shares363,645
Max PriceNZ$4.68

Ownership Breakdown


Management Team

  • Kate McKenzie

    CEO, MD & Director

    • Tenure: 2.8yrs
    • Compensation: NZ$2.07m
  • Ewen Powell

    Chief Technology Officer

    • Tenure: 0yrs
  • Andy Carroll

    General Manager of Network & Field Management

    • Tenure: 1.4yrs
  • Andrew Hopkinson

    Treasurer

    • Tenure: 0yrs
  • Elaine Campbell

    General Counsel & Company Secretary

    • Tenure: 1.2yrs
  • Ed Hyde

    Chief Customer Officer

    • Tenure: 1.3yrs
  • Brett Jackson

    Investor Relations Manager

    • Tenure: 0yrs
  • Nathan Beaumont

    Media & PR Manager

    • Tenure: 0yrs
  • Shaun Philp

    General Manager of People & Culture

    • Tenure: 2.1yrs
  • David Collins

    Chief Financial Officer

    • Tenure: 0.8yrs

Board Members

  • Jon Hartley

    Deputy Chairman

    • Tenure: 4.1yrs
    • Compensation: NZ$167.75k
  • Patrick Strange

    Independent Chairman

    • Tenure: 4.1yrs
    • Compensation: NZ$223.65k
  • Anne Urlwin

    Independent Director

    • Tenure: 7.8yrs
    • Compensation: NZ$153.80k
  • Jack Matthews

    Independent Director

    • Tenure: 2.3yrs
    • Compensation: NZ$125.75k
  • Kate McKenzie

    CEO, MD & Director

    • Tenure: 2.8yrs
    • Compensation: NZ$2.07m
  • Murray Jordan

    Independent Director

    • Tenure: 4.1yrs
    • Compensation: NZ$125.75k
  • Prudence Flacks

    Independent Director

    • Tenure: 7.8yrs
    • Compensation: NZ$145.78k
  • Mark Cross

    Independent Non-Executive Director

    • Tenure: 2.9yrs
    • Compensation: NZ$130.30k

Company Information

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


Key Information

  • Name: Chorus Limited
  • Ticker: CNU
  • Exchange: NZSE
  • Founded: 2008
  • Industry: Alternative Carriers
  • Sector: Telecom
  • Market Cap: NZ$2.392b
  • Shares outstanding: 443.71m
  • Website: https://www.chorus.co.nz

Number of Employees


Location

  • Chorus Limited
  • 1 Willis Street
  • Level 10
  • Wellington
  • New Zealand

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
CNUNZSE (New Zealand Stock Exchange)YesOrdinary SharesNZNZDNov 2011
CNUASX (Australian Securities Exchange)YesOrdinary SharesAUAUDNov 2011
7CHBST (Boerse-Stuttgart)YesOrdinary SharesDEEURNov 2011
CRRL.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDNov 2011
7CHDB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 2011
CNUCHIA (Chi-X Australia)YesOrdinary SharesAUAUDNov 2011
CHRY.YOTCPK (Pink Sheets LLC)SPONSORED ADSUSUSDNov 2011

Biography

Chorus Limited, together with its subsidiaries, provides fixed line communications infrastructure services in New Zealand. It offers phone and broadband services over copper and fiber networks for resident ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/21 10:34
End of Day Share Price2019/10/18 00:00
Earnings2019/06/30
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.