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Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Chunghwa Telecom Co Ltd
CHT : NYSE : Technology
$30.50 | %
Today's Range: 0.00 - 0.00
Avg. Daily Volume: 109,500
07/21/14 - 4:02 PM ET

Financial Analysis


CHUNGHWA TELECOM LTD's gross profit margin for the first quarter of its fiscal year 2014 has increased when compared to the same period a year ago. Even though sales decreased, the net income has increased, representing an increase to the bottom line. CHUNGHWA TELECOM LTD has weak liquidity. Currently, the Quick Ratio is 0.96 which shows a lack of ability to cover short-term cash needs. The company's liquidity has decreased from the same period last year.

During the same period, stockholders' equity ("net worth") has remained virtually unchanged only decreasing by 2.55% from the same quarter last year. Overall, the key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the future.

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Income Statement Q1 FY14 Q1 FY13
Net Sales ($mil)1807.881899.26
EBITDA ($mil)665.65644.45
EBIT ($mil)390.99377.69
Net Income ($mil)336.14308.66


Balance Sheet Q1 FY14 Q1 FY13
Cash & Equiv. ($mil)873.161411.36
Total Assets ($mil)14636.3714942.67
Total Debt ($mil)65.8263.93
Equity ($mil)12160.8212480.29


Profitability Q1 FY14 Q1 FY13
Gross Profit Margin51.6147.9
EBITDA Margin36.8133.93
Operating Margin21.6319.89
Sales Turnover0.520.51
Return on Assets9.699.1
Return on Equity11.6610.9
Debt Q1 FY14 Q1 FY13
Current Ratio1.32.06
Debt/Capital0.010.01
Interest Expense0.290.27
Interest Coverage1362.341414.56


Share Data Q1 FY14 Q1 FY13
Shares outstanding (mil)775.75775.75
Div / share0.00.0
EPS0.430.4
Book value / share15.6816.09
Institutional Own % n/a n/a
Avg Daily Volume112110.0149915.0

Valuation


BUY. This stock's P/E ratio indicates a discount compared to an average of 16.64 for the Diversified Telecommunication Services industry and a discount compared to the S&P 500 average of 19.42. To use another comparison, its price-to-book ratio of 1.94 indicates a discount versus the S&P 500 average of 2.68 and a significant discount versus the industry average of 5.62. The price-to-sales ratio is well above both the S&P 500 average and the industry average, indicating a premium. Upon assessment of these and other key valuation criteria, CHUNGHWA TELECOM LTD proves to trade at a discount to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
CHT 16.60 Peers 16.64   CHT 9.23 Peers 4.92

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

CHT is trading at a valuation on par with its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

CHT is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
CHT NA Peers 17.78   CHT NM Peers 1.25

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

CHT is trading at a premium to its peers.

 

Neutral. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

CHT's negative PEG ratio makes this valuation measure meaningless.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
CHT 1.94 Peers 5.62   CHT 3.97 Peers 269.94

Discount. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

CHT is trading at a significant discount to its peers.

 

Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

However, CHT is expected to significantly trail its peers on the basis of its earnings growth rate.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
CHT 3.12 Peers 1.59   CHT -0.62 Peers 2.39

Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

CHT is trading at a significant premium to its industry.

 

Lower. A sales growth rate that trails the industry implies that a company is losing market share.

CHT significantly trails its peers on the basis of sales growth

 

 

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