SGX:Z74

Stock Analysis Report

NOT FOR DISTRIBUTION
Header cover image

Singapore Telecommunications

Executive Summary

Singapore Telecommunications Limited provides communication, infotainment, and technology services to consumers and small businesses in Singapore, Australia, the United States, and internationally. More Details


Snowflake Analysis

Second-rate dividend payer and slightly overvalued.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: Z74 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

-2.7%

Z74

-1.9%

SG Telecom

0.3%

SG Market


1 Year Return

-32.1%

Z74

-15.2%

SG Telecom

-21.8%

SG Market

Return vs Industry: Z74 underperformed the SG Telecom industry which returned -15.2% over the past year.

Return vs Market: Z74 underperformed the SG Market which returned -21.8% over the past year.


Shareholder returns

Z74IndustryMarket
7 Day-2.7%-1.9%0.3%
30 Day-5.3%-5.0%-1.7%
90 Day-14.6%-3.3%-5.1%
1 Year-29.1%-32.1%-11.7%-15.2%-17.5%-21.8%
3 Year-31.4%-41.3%-6.0%-16.6%-17.6%-27.6%
5 Year-22.2%-39.2%11.8%-6.8%0.4%-18.1%

Price Volatility Vs. Market

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


Simply Wall St News

Valuation

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

0.9%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: Z74 (SGD2.16) is trading below our estimate of fair value (SGD2.18)

Significantly Below Fair Value: Z74 is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: Z74 is poor value based on its PE Ratio (32.8x) compared to the XA Telecom industry average (18.7x).

PE vs Market: Z74 is poor value based on its PE Ratio (32.8x) compared to the SG market (12.7x).


Price to Earnings Growth Ratio

PEG Ratio: Z74 is poor value based on its PEG Ratio (1.7x)


Price to Book Ratio

PB vs Industry: Z74 is good value based on its PB Ratio (1.3x) compared to the XA Telecom industry average (1.7x).


Next Steps

Future Growth

How is Singapore Telecommunications forecast to perform in the next 1 to 3 years based on estimates from 17 analysts?

19.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: Z74's forecast earnings growth (19.9% per year) is above the savings rate (2.2%).

Earnings vs Market: Z74's earnings (19.9% per year) are forecast to grow slower than the SG market (21.8% per year).

High Growth Earnings: Z74's earnings are forecast to grow, but not significantly.

Revenue vs Market: Z74's revenue is expected to decline over the next 3 years (-0.4% per year).

High Growth Revenue: Z74's revenue is forecast to decline over the next 3 years (-0.4% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: Z74's Return on Equity is forecast to be low in 3 years time (10.8%).


Next Steps

Past Performance

How has Singapore Telecommunications performed over the past 5 years?

-11.1%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: Z74 has a large one-off gain of SGD419.3M impacting its March 31 2020 financial results.

Growing Profit Margin: Z74's current net profit margins (6.5%) are lower than last year (17.8%).


Past Earnings Growth Analysis

Earnings Trend: Z74's earnings have declined by 11.1% per year over the past 5 years.

Accelerating Growth: Z74's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: Z74 had negative earnings growth (-65.2%) over the past year, making it difficult to compare to the Telecom industry average (0.6%).


Return on Equity

High ROE: Z74's Return on Equity (3.9%) is considered low.


Next Steps

Financial Health

How is Singapore Telecommunications's financial position?


Financial Position Analysis

Short Term Liabilities: Z74's short term assets (SGD7.2B) do not cover its short term liabilities (SGD10.6B).

Long Term Liabilities: Z74's short term assets (SGD7.2B) do not cover its long term liabilities (SGD11.6B).


Debt to Equity History and Analysis

Debt Level: Z74's debt to equity ratio (45.2%) is considered high.

Reducing Debt: Z74's debt to equity ratio has increased from 35.4% to 45.2% over the past 5 years.

Debt Coverage: Z74's debt is well covered by operating cash flow (48%).

Interest Coverage: Z74's interest payments on its debt are well covered by EBIT (7.4x coverage).


Balance Sheet


Next Steps

Dividend

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

5.67%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: Z74's dividend (5.67%) is higher than the bottom 25% of dividend payers in the SG market (2.59%).

High Dividend: Z74's dividend (5.67%) is in the top 25% of dividend payers in the SG market (5.63%)


Stability and Growth of Payments

Stable Dividend: Z74's dividend payments have been volatile in the past 10 years.

Growing Dividend: Z74's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (186.1%), Z74's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Z74's dividends in 3 years are forecast to be covered by earnings (70.4% payout ratio).


Next Steps

Management

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

5.4yrs

Average management tenure


CEO

Sock Koong Chua (63 yo)

13.42yrs

Tenure

S$3,099,932

Compensation

Ms. Sock Koong Chua has been the Chief Executive Officer of SingTel Optus Pty Ltd since April 1, 2007. Ms. Chua has been the Chief Executive Officer of Singapore Telecommunications Limited since April 1, 2 ...


CEO Compensation Analysis

Compensation vs Market: Sock Koong's total compensation ($USD2.27M) is below average for companies of similar size in the SG market ($USD6.35M).

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


Leadership Team

NamePositionTenureCompensationOwnership
Sock Koong Chua
Group CEO13.42yrsS$3.10m0.055%
SGD 19.5m
Yoong Keong Lew
CEO of Group Strategy & Business Development and Country Chief Officer of Thailand8.42yrsS$2.77mno data
Ngiap Jong Low
Group Chief Corporate Officer5.42yrsS$1.47mno data
Kuan Moon Yuen
CEO of Consumer Singapore & Group Chief Digital Officer2.08yrsS$1.55mno data
York Chye Chang
CEO of Group Enterprise & Country Chief Officer of Singapore14.83yrsS$1.41mno data
Tao Yih Lang
Chief Executive Officer of International3.42yrsS$1.23mno data
Cheng Cheng Lim
Group Chief Financial Officer5.42yrsno datano data
Mark Chong
Group Chief Technology Officer3.42yrsno datano data
William Woo
Group Chief Information Officer3.08yrsno datano data
Yang Sin
Vice President of Investor Relationsno datano datano data
Lian Pek
Vice President of Group Corporate Communications & Brandno datano datano data
Chris Smith
Head of Digital Sales & Service - Optusno datano datano data

5.4yrs

Average Tenure

56yo

Average Age

Experienced Management: Z74's management team is seasoned and experienced (5.4 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Sock Koong Chua
Group CEO13.42yrsS$3.10m0.055%
SGD 19.5m
Venkataraman Ganesan
Non-Executive & Independent Director & Chairman of Technology Advisory Panelno dataS$396.40k0.00020%
SGD 70.5k
John Morschel
Member of Optus Advisory Committeeno dataS$68.21kno data
Theng Lee
Non Independent Non Executive Chairman & Member of Optus Advisory Committee0.17yrno datano data
Paul O'Sullivan
Member of Optus Advisory Committeeno dataS$3.01mno data
David Gonski
Member of Optus Advisory Committeeno dataS$158.11kno data
Swee Lian Teo
Non-Executive & Independent Director5.42yrsS$205.00k0.000010%
SGD 3.5k
Check Kian Low
Non-Executive & Lead Independent Director5.17yrsS$225.00k0.000010%
SGD 3.5k
Boon Hwee Koh
Member of Technology Advisory Panel6.42yrsno datano data
Gautam Banerjee
Non-Executive & Independent Director2.5yrsS$195.27kno data
Kwee Fong Hon
Non-Executive & Independent Director6.42yrsS$184.75kno data
Gail Kelly
Non-Executive & Independent Director and Chairman of Optus Advisory Committeeno dataS$243.08kno data

5.4yrs

Average Tenure

65yo

Average Age

Experienced Board: Z74's board of directors are considered experienced (5.4 years average tenure).


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

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


Key Information

  • Name: Singapore Telecommunications Limited
  • Ticker: Z74
  • Exchange: SGX
  • Founded: 1992
  • Industry: Integrated Telecommunication Services
  • Sector: Telecom
  • Market Cap: S$35.254b
  • Shares outstanding: 16.32b
  • Website: https://www.singtel.com

Number of Employees


Location

  • Singapore Telecommunications Limited
  • 31 Exeter Road
  • No. 19-00 Comcentre
  • Singapore
  • 239732
  • Singapore

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
SNGN.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDNov 1993
Z74SGX (Singapore Exchange)YesOrdinary SharesSGSGDNov 1993
SIT4DB (Deutsche Boerse AG)YesOrdinary SharesDEEURNov 1993
SGAP.YOTCPK (Pink Sheets LLC)SPON ADR NEW06USUSDAug 1995

Biography

Singapore Telecommunications Limited provides communication, infotainment, and technology services to consumers and small businesses in Singapore, Australia, the United States, and internationally. It oper ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/09/22 19:28
End of Day Share Price2020/09/22 00:00
Earnings2020/03/31
Annual Earnings2020/03/31


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.