Tue, Feb 17, 2015 - Page 13 News List

Foreign broker upbeat on Far EasTone’s prospects

Staff writer, with CNA

A European broker said it was optimistic about Far EasTone Telecommunications Co’s (遠傳電信) outlook, citing its rapidly expanding subscriber base.

In a research note, the broker, which cannot be named under local regulations, said it expects Far EasTone’s 4G subscriber numbers to reach 3 million by the end of this year, up from the 1 million recorded at the end of last year.

The broker said it believes that Far EasTone, one of the nation’s top three telecom operators, would achieve its goal as it has enjoyed stable growth in 4G subscriber numbers, who account for 16 percent of the company’s total clientele.

The brokerage maintained its “buy” rating on Far EasTone and its target price of NT$83 (US$2.63).

On Friday, the last trading session ahead of the Lunar New Year holiday, Far EasTone shares closed up 2.37 percent at NT$77.80 after foreign institutional investors bought a net 3.22 million shares of the company.

The stock outperformed the broader market, which rose 0.34 percent. The local bourse will remain closed until Monday next week.

In an investor conference on Friday, Far EasTone said it expects revenue this year to rise 2.4 percent from a year earlier, while costs resulting from 4G equipment depreciation would push its net profit down 3.5 percent from a year earlier with earnings per share at NT$3.40.

Last year, Far EasTone posted NT$94.18 billion in consolidated sales, up 5 percent from a year earlier. Its unaudited EPS stood at NT$3.52, compared with NT$3.63 in 2013.

The telecom operator has proposed issuing NT$3.75 in cash dividends for last year, unchanged from a year earlier.

The cash dividend proposal is pending approval from shareholders.

A US-based brokerage said that it was glad that the dividend payout ratio topped 100 percent and maintained its “overweight” rating on Far EasTone.

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