muganda wrote:Oh one last thing @young @hisah, you remember our discussion below, considering most foreign large players expected these results, it will be interesting to watch their reaction in the coming days...
hisah wrote:#10muganda wrote:Actually @hisah SBG Securities/Stanbic estimates Safaricom 1H14 EPS up +63% y/y or +2% h/h, driven by 17% y/y revenue growth to KSh68bn with an EBITDA margin of 40%.
Note however they are of the view rating is unjustified as even a P/E of 16.2 is a 25% premium over peer group - MTN, Vodacom etc. Hence their recommnedation - SELL - target price 8.00 DCF
The direction of the share on announcement will depend, as always, on dear foreigners.
SBG & HSBC saying the same script. Perfect. Interesting SBG was spot on with their revenue projections but the elephant missed their EPS projections by a big margin.
Are they going to cut their TP further?
On valuations I agree with them,this sort of growth has been priced into the share price. On a straight line basis forward PE is 17 although I expect a bumber dividend at year end as cash flows improve but they need to invest more in their network...its becoming horrible everyday.
If anything this kind of results will give the other telco's more ammunition for calls to level the playing field...only SCOM makes money in Kenya's telco industry the rest are loss making...80% voice traffic market share means the other 3 are only sharing 20%!