Stock Name: M1
Company Name: M1 LIMITED
Kim Eng Research in a June 10 research report says "For FY2011, we think M1 will have the added catalyst of a possible dividend encore. We upgrade our dividend forecast for FY2011 from 14.5 cents a share to 18 cents a share, assuming a 100% payout ratio against the typical 80%.
"With just $12 million capex in 1Q11, the trend for the rest of the year should stay similarly tame. This should enhance M1's ability to pay more dividends. Although costs are likely to rise in 2H11 as M1 ramps up its NGNBN-related sales activities, most of them will be variable in nature.
"In fact, as it cuts more traffic to its own backhaul transmission network this year, higher sales costs should be mitigated by lower leased circuit costs. Target price of $2.88, based on 16x FY2011F earnings. MAINTAIN BUY."
Company Name: M1 LIMITED
| Research House: Kim Eng | Price Call: BUY | Target Price: 2.88 |
Kim Eng Research in a June 10 research report says "For FY2011, we think M1 will have the added catalyst of a possible dividend encore. We upgrade our dividend forecast for FY2011 from 14.5 cents a share to 18 cents a share, assuming a 100% payout ratio against the typical 80%.
"With just $12 million capex in 1Q11, the trend for the rest of the year should stay similarly tame. This should enhance M1's ability to pay more dividends. Although costs are likely to rise in 2H11 as M1 ramps up its NGNBN-related sales activities, most of them will be variable in nature.
"In fact, as it cuts more traffic to its own backhaul transmission network this year, higher sales costs should be mitigated by lower leased circuit costs. Target price of $2.88, based on 16x FY2011F earnings. MAINTAIN BUY."
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