TSEC:2412

Stock Analysis Report

Chunghwa Telecom

Executive Summary

Chunghwa Telecom Co., Ltd. provides telecommunication services in Taiwan.


Snowflake Analysis

Flawless balance sheet and slightly overvalued.


Similar Companies

Share Price & News

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


Latest Share Price and Events

Stable Share Price: 2412 has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

0.9%

2412

1.4%

TW Telecom

8.4%

TW Market


1 Year Return

-3.6%

2412

-4.4%

TW Telecom

-10.6%

TW Market

Return vs Industry: 2412 matched the TW Telecom industry which returned -2.7% over the past year.

Return vs Market: 2412 exceeded the TW Market which returned -9.9% over the past year.


Shareholder returns

2412IndustryMarket
7 Day0.9%1.4%8.4%
30 Day-1.4%-1.7%-14.9%
90 Day-3.2%-4.5%-19.9%
1 Year0.4%-3.6%-0.5%-4.4%-6.4%-10.6%
3 Year17.9%3.4%13.6%0.3%8.7%-3.9%
5 Year34.6%7.3%25.6%1.7%21.0%-0.8%

Price Volatility Vs. Market

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


Simply Wall St News

No news available

Valuation

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

8.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: 2412 (NT$106.5) is trading below our estimate of fair value (NT$116.3)

Significantly Below Fair Value: 2412 is trading below fair value, but not by a significant amount.


Price To Earnings Ratio

PE vs Industry: 2412 is good value based on its PE Ratio (25.2x) compared to the Telecom industry average (25.4x).

PE vs Market: 2412 is poor value based on its PE Ratio (25.2x) compared to the TW market (13.6x).


Price to Earnings Growth Ratio

PEG Ratio: 2412's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: 2412 is overvalued based on its PB Ratio (2.2x) compared to the TW Telecom industry average (1x).


Next Steps

Future Growth

How is Chunghwa Telecom forecast to perform in the next 1 to 3 years based on estimates from 11 analysts?

-2.0%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: 2412's earnings are forecast to decline over the next 3 years (-2% per year).

Earnings vs Market: 2412's earnings are forecast to decline over the next 3 years (-2% per year).

High Growth Earnings: 2412's earnings are forecast to decline over the next 3 years.

Revenue vs Market: 2412's revenue (0.4% per year) is forecast to grow slower than the TW market (7% per year).

High Growth Revenue: 2412's revenue (0.4% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: 2412's Return on Equity is forecast to be low in 3 years time (8.2%).


Next Steps

Past Performance

How has Chunghwa Telecom performed over the past 5 years?

-2.5%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: 2412 has high quality earnings.

Growing Profit Margin: 2412's current net profit margins (15.8%) are lower than last year (17.4%).


Past Earnings Growth Analysis

Earnings Trend: 2412's earnings have declined by -2.5% per year over the past 5 years.

Accelerating Growth: 2412's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 2412 had negative earnings growth (-12.7%) over the past year, making it difficult to compare to the Telecom industry average (-8.6%).


Return on Equity

High ROE: 2412's Return on Equity (8.7%) is considered low.


Next Steps

Financial Health

How is Chunghwa Telecom's financial position?


Financial Position Analysis

Short Term Liabilities: 2412's short term assets (NT$94.1B) exceed its short term liabilities (NT$64.4B).

Long Term Liabilities: 2412's short term assets (NT$94.1B) exceed its long term liabilities (NT$26.7B).


Debt to Equity History and Analysis

Debt Level: 2412's debt to equity ratio (0.4%) is considered satisfactory.

Reducing Debt: 2412's debt to equity ratio has reduced from 0.7% to 0.4% over the past 5 years.

Debt Coverage: 2412's debt is well covered by operating cash flow (4285.6%).

Interest Coverage: 2412 earns more interest than it pays, so coverage of interest payments is not a concern.


Balance Sheet

Inventory Level: 2412 has a high level of physical assets or inventory.

Debt Coverage by Assets: 2412's debt is covered by short term assets (assets are 55.7x debt).


Next Steps

Dividend

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

3.97%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: 2412's dividend (3.97%) is higher than the bottom 25% of dividend payers in the TW market (3.31%).

High Dividend: 2412's dividend (3.97%) is low compared to the top 25% of dividend payers in the TW market (7.12%).


Stability and Growth of Payments

Stable Dividend: 2412's dividend payments have been volatile in the past 10 years.

Growing Dividend: 2412's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its high payout ratio (99.9%), 2412's dividend payments are not well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: 2412's dividends in 3 years are not forecast to be well covered by earnings (96% payout ratio).


Next Steps

Management

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

0.9yrs

Average management tenure


CEO

Chi-Mau Sheih (65yo)

0.92

Tenure

Mr. Chi-Mau Sheih has been Chairman and Chief Executive Officer at Chunghwa Telecom Co., Ltd. since April 22, 2019. Mr. Sheih served as the President of Chunghwa Telecom Co., Ltd. since January 4, 2017 unt ...


Leadership Team

NamePositionTenureCompensationOwnership
Chi-Mau Sheih
Chairman & CEO0.92yrno data0.00093% NT$7.7m
Shui-Yi Kuo
President0.92yrno datano data
Yeong-Jienn Maw
Presidentno datano data0.00039% NT$3.2m
Tang Zhang
Presidentno datano data0.000030% NT$247.9k
Jin-Ming Shi
Presidentno datano data0.00015% NT$1.2m
Zhao-Fu Lai
Presidentno datano data0.00014% NT$1.2m
Xi-Sheng Zheng
Presidentno datano data0.00055% NT$4.5m
Guo-Ji Huang
Presidentno datano data0.000050% NT$413.1k
Hui-Bao Huang
Presidentno datano data0.000030% NT$247.9k
Dahsung Lee
Vice President of Accounting Department2.92yrsno datano data

0.9yrs

Average Tenure

Experienced Management: 2412's management team is not considered experienced ( 0.9 years average tenure), which suggests a new team.


Board Members

NamePositionTenureCompensationOwnership
Chi-Mau Sheih
Chairman & CEO0.92yrno data0.00093% NT$7.7m
Shui-Yi Kuo
President0.92yrno datano data
Lo-Yu Yen
Independent Director3.75yrsno datano data
Jen-Ran Chen
Independent Director3.75yrsno datano data
Shin-Yi Chang
Director0.75yrno datano data
Chin-Tsai Pan
Director3yrsno data0.000030% NT$247.9k
Yu-Fen Lin
Independent Director2.75yrsno datano data
Chung-Chin Lu
Independent Director1.75yrsno datano data
Yu-Lin Huang
Director1yrno datano data
Sin-Horng Chen
Director0.75yrno datano data

1.4yrs

Average Tenure

60yo

Average Age

Experienced Board: 2412's board of directors are not considered experienced ( 1.4 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

Chunghwa Telecom Co., Ltd.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Chunghwa Telecom Co., Ltd.
  • Ticker: 2412
  • Exchange: TSEC
  • Founded: 1996
  • Industry: Integrated Telecommunication Services
  • Sector: Telecom
  • Market Cap: NT$826.168b
  • Shares outstanding: 7.76b
  • Website: https://www.cht.com.tw

Number of Employees


Location

  • Chunghwa Telecom Co., Ltd.
  • No. 21-3, Hsinyi Road
  • Sec. 1
  • Taipei City
  • 10048
  • Taiwan

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
2412TSEC (Taiwan Stock Exchange)YesCommon SharesTWTWDOct 2000
CHTNYSE (New York Stock Exchange)ADR EA REPR 10 ORD TWD10USUSDJul 2003
CHWDDB (Deutsche Boerse AG)ADR EA REPR 10 ORD TWD10DEEURJul 2003

Biography

Chunghwa Telecom Co., Ltd. provides telecommunication services in Taiwan. It operates through Domestic Fixed Communications Business, Mobile Communications Business, Internet Business, International Fixed Communications Business, and Other Business segments. It offers local and domestic long distance telephone and leased line, broadband access, Wi-Fi, and multimedia on demand services; information and communication technology (ICT), corporate, and bill handling services; and interconnection with its fixed-line network to other mobile and fixed-line operators. It also offers mobile; HiNet Internet, data communication, and cloud; Internet value-added and data center; international long distance telephone, data, and other; and satellite services. In addition, it distributes and sells mobile handsets, tablets, data cards, electronic materials, ICT products, and computing and business machinery equipment and software; designs, develops, produces, sells, and services semiconductor testing components, printed circuit boards, and electronic components and finished products, and automatic license plate recognition software and hardware products. Further, it offers property development and management; system, network, and communications integration; intelligent buildings and energy network; digital information supply and advertisement; property and liability insurance agency; digital family education; computing equipment installation; management consultancy; data processing; telecommunication engineering; Internet identify; and information and communication solution services. Additionally, it engages in the investment; digital entertainment content production; animated character licensing and endorsement; and mobile digital platform construction businesses, as well as provision of energy saving solutions and international circuits, and services for electronic parts and machinery processed products. The company was founded in 1996 and is headquartered in Taipei City, Taiwan. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/03/30 15:39
End of Day Share Price2020/03/30 00:00
Earnings2019/12/31
Annual Earnings2019/12/31


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.