SGX:N01

Stock Analysis Report

Nera Telecommunications

Executive Summary

Nera Telecommunications Ltd designs, engineers, sells, distributes, installs, services, and maintains telecommunication systems and products in transmission networks and satellite communications, and information technology networks worldwide.

Snowflake

Fundamentals

Excellent balance sheet and slightly overvalued.


Similar Companies

Share Price & News

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


Latest Share Price and Events


Market Performance


7 Day Return

-1.8%

N01

-1.1%

SG Communications

-0.002%

SG Market


1 Year Return

-6.9%

N01

7.3%

SG Communications

0.7%

SG Market

Return vs Industry: N01 underperformed the SG Communications industry which returned 7.3% over the past year.

Return vs Market: N01 underperformed the SG Market which returned 0.7% over the past year.


Shareholder returns

N01IndustryMarket
7 Day-1.8%-1.1%-0.002%
30 Day-1.8%2.4%-1.4%
90 Day-1.8%1.4%-7.3%
1 Year-0.4%-6.9%11.8%7.3%4.7%0.7%
3 Year-44.4%-64.7%-25.4%-43.1%15.1%2.8%
5 Year-40.2%-65.6%-39.7%-54.1%10.1%-8.2%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

13.6%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: N01 (SGD0.27) is trading below our estimate of fair value (SGD0.31)

Significantly Undervalued: N01 is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: N01 is good value based on its PE Ratio (17.5x) compared to the Communications industry average (29.6x).

PE vs Market: N01 is poor value based on its PE Ratio (17.5x) compared to the SG market (13.5x).


Price to Earnings Growth Ratio

Low PEG Ratio: Insufficient data to calculate N01's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: N01 is overvalued based on its PB Ratio (1.5x) compared to the SG Communications industry average (1.1x).


Next Steps

Future Growth

How is Nera Telecommunications forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

-1.2%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: N01's earnings are forecast to decline over the next 3 years (-1.2% per year).

Earnings vs Market: N01's earnings are forecast to decline over the next 3 years (-1.2% per year).

High Growth Earnings: N01's earnings are forecast to decline over the next 3 years.

Revenue vs Market: Insufficient data to determine if N01's revenue is forecast to grow faster than the SG market.

High Growth Revenue: Insufficient data to determine if N01's revenue is forecast to grow faster than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: Insufficient data to determine if N01's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has Nera Telecommunications performed over the past 5 years?

-21.9%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: N01's earnings have declined by -21.9% per year over the past 5 years.

Accelerating Growth: N01's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: N01 had negative earnings growth (-32.9%) over the past year, making it difficult to compare to the Communications industry average (2.2%).


Return on Equity

High ROE: N01's Return on Equity (8.7%) is considered low.


Return on Assets

ROA vs Industry: N01's Return on Assets is below or equal to the Communications industry average last year.


Return on Capital Employed

ROCE Improving: N01's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is Nera Telecommunications's financial position?


Financial Position Analysis

Short Term Liabilities: N01's short term assets (SGD149.5M) exceeds its short term liabilities (SGD89.9M)

Long Term Liabilities: N01's short term assets (149.5M) exceeds its long term liabilities (4.4M)


Debt to Equity History and Analysis

Debt Level: N01's debt to equity ratio (18.4%) is considered satisfactory

Reducing Debt: N01 had negative shareholder equity 5 years ago, but is now positive and has therefore improved.

Debt Coverage: N01's operating cash flow is negative, therefore debt is not well covered.

Interest Coverage: N01 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: N01 has a low level of unsold assets or inventory.

Debt Coverage by Assets: N01's debt is covered by short term assets (assets are 12.559910x debt).


Next Steps

Dividend

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

9.26%

Current Dividend Yield


Dividend Yield vs Market

company9.3%marketbottom25%2.6%markettop25%5.7%industryaverage1.3%forecastin3Yearsn/a

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: N01's dividend (9.26%) is higher than the bottom 25% of dividend payers in the SG market (2.55%).

High Dividend: N01's dividend (9.26%) is in the top 25% of dividend payers in the SG market (5.71%)

Stable Dividend: N01's dividend payments have been volatile in the past 10 years.

Growing Dividend: N01's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (129.4%), N01's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

1.1yrs

Average management tenure


CEO

Tong Hong Beck 0

2.3yrs

Tenure

S$1,597,841

Compensation

Mr. Tong Hong Beck has been the Chief Executive Officer of Nera Telecommunications Ltd since July 2017 and as its Executive Director since November 8, 2017. Mr. Beck served as Vice President of Network Inf ...


CEO Compensation Analysis

Compensation vs. Market: Tong Hong's total compensation ($USD0.00) is too low to compare against companies of similar size in the SG market ($USD260.30K).

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


Management Age and Tenure

1.1yrs

Average Tenure

Experienced Management: N01's management team is not considered experienced ( 1.1 years average tenure), which suggests a new team.


Board Age and Tenure

6.0yrs

Average Tenure

56.5yo

Average Age

Experienced Board: N01's board of directors are considered experienced (6 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


Management Team

  • Lucy Phua

    Vice President of Accounts

    • Tenure: 0yrs
  • Michael Chan (53yo)

    Senior Vice President of Contracts & Corporate Secretariat

    • Tenure: 0yrs
  • Ahmad Hashim (61yo)

    Managing Director for Nera (Malaysia) Sdn Bhd

    • Tenure: 0yrs
  • Tong Hong Beck

    CEO & Executive Director

    • Tenure: 2.3yrs
    • Compensation: S$1.60m
  • Jacqueline Tan

    Senior Financial Controller

    • Tenure: 0yrs
  • Orlando Tan

    Senior Vice President of Network Infrastructure

    • Tenure: 0yrs
  • Wan Mei Chan

    Joint Company Secretary

    • Tenure: 1.1yrs
  • Lee Teng Gan

    Joint Company Secretary

    • Tenure: 1.1yrs

Board Members

  • Kwok Cheong Lee (64yo)

    Independent Director

    • Tenure: 6.6yrs
    • Compensation: S$104.00k
  • Lye Huat Tan (69yo)

    Independent Director

    • Tenure: 6.8yrs
    • Compensation: S$104.00k
  • Su-Yen Wong (49yo)

    Independent Chairman

    • Tenure: 5.5yrs
    • Compensation: S$153.00k
  • Choon Hong Tan (44yo)

    Non-Executive Director

    • Tenure: 6.8yrs
    • Compensation: S$48.00k
  • Tong Hong Beck

    CEO & Executive Director

    • Tenure: 2.3yrs
    • Compensation: S$1.60m
  • Tommy Teo

    Non-Executive Director

    • Tenure: 1.7yrs

Company Information

Nera Telecommunications Ltd's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Nera Telecommunications Ltd
  • Ticker: N01
  • Exchange: SGX
  • Founded: 1978
  • Industry: Communications Equipment
  • Sector: Tech
  • Market Cap: S$97.712m
  • Shares outstanding: 361.90m
  • Website: https://www.nera.net

Location

  • Nera Telecommunications Ltd
  • 109 Defu Lane 10
  • Singapore
  • 539225
  • Singapore

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
N01SGX (Singapore Exchange)YesOrdinary SharesSGSGDJul 1999

Biography

Nera Telecommunications Ltd designs, engineers, sells, distributes, installs, services, and maintains telecommunication systems and products in transmission networks and satellite communications, and infor ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/19 12:34
End of Day Share Price2019/10/18 00:00
Earnings2019/06/30
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.