CHA Investment Analysis Report & Stock Research, China Telecom Corp. Limited

China Telecom Corporation Limited (CHA)

CHA Stock Report

2-Year Price History

View Larger CHA Chart
NYSE:CHA
$50.41
(4/1 4:00PM)
+2.9%
Open$50.22 Mkt Cap$39.6 Billion
High$50.48 52Wk High$56.41
Low$49.95 52Wk Low$40.28
Volume119,601 Avg Vol 10D154,200

Ockham’s Rating/Recommendation Summary

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CHA Revenue

Cash earnings is the most important factor in our analysis, but it goes without saying that if a company cannot produce sales then there is no ability to generate cash flow. By that logic we look very closely at revenue numbers as our second most important factor in valuing a company’s stock. We have established reasonable Price to Sales per share ranges based on historical data of the last 9 years. For, CHA the high and low end of the Price to Sales per share ratios are 2.45x and 1.18x respectively.

Notice that CHA’s current Price to Sales per share ratio is 1.28x, which is significantly below its average levels historically. In fact, with a current price of $48.67, CHA is a full 30% below its average Price to Sales ratio at comparable sales levels. This is a rare occurrence and, when taken in context of the other areas of our analysis, can be a strong positive for our outlook for CHA.

CHA Cash Earnings

Cash Earnings is always one of the most important factors to review for a company and, more importantly, an investment in a stock. CHA is above their historical average multiples of Cash Earnings, as calculated by our proprietary analysis. It is incredibly important to understand that for CHA, the current level of Cash Earnings compared to its historical levels helps identify where CHA is in relation to what the investing community was willing to pay for this level of Cash Earnings in the past. With a historical high Cash Earnings per share ratio of 6.63 and a historical low Cash Earnings per share ratio of 3.07, an investor can relate where value becomes optimal.

Given this range of ratios per share, CHA at its current price of $48.67 and a Price to Cash Earnings ratio of 4.90 is 1% above its average historical Price to Cash Earnings ratio. Obviously this makes us more hesitant about CHA because cash earnings would need to rise to improve the valuation. Likewise, a decline in Price to Cash Earnings to below the average of 4.85 would significantly improve our outlook for CHA given the current profit levels.

CHA Dividends

When determining a company’s future prospects for success, Ockham Research sees analysis of dividend payments as a key additional factor. Even though it isn’t imperative for CHA to shell out a dividend in order to receive a positive rating, it can be helpful to further our analysis.

The estimated annual dividend for CHA is $0.99 producing a current dividend yield of 2.03%. Much like our evaluation of Sales and Cash Earnings per share, we review dividend yields from CHA against the historic high and low levels over all available dividend history. Because dividends are a decision made exclusively by management, we view a healthy and rising dividend as a sign of confidence and strength. The highest dividend yield from CHA over previous years was 4.21% while the lowest dividend yield was 0.00%. CHA is not making us feel all that confident when their current dividend yield is below the historical median by 3.56%.

Peer Comparison

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China Telecom Corp. Limited Industry Grouping

(3/31/2010)
Company Ticker Market Cap (Ml) Latest
Price
Price/Cash Earnings Price/Sales 5-Yr. Rev.
Growth Rate
5-Yr.
Avg. ROE.
Current 10-Yr. Range* Current 10-Yr. Range*
Peer Company Averages (not including CHA) 13.72 4.56 » 56.78 2.93 0.67 » 9.09 26.37% 19.32%
*10 year range does not include current year values
Research In Motion Limited RIMM $41.1 Billion $73.97 14.80 8.43 » 87.26 2.91 1.49 » 17.92 79.45% 24.08%
China Telecom Corp. Limited CHA $39.6 Billion $48.99 4.90 1.82 » 9.27 1.28 0.77 » 3.27 13.86% 11.52%
LM Ericsson Telephone Co- Shs -B- American Deposit Receipt Repr 1 Shs B ERIC $34.2 Billion $10.44 31.78 7.62 » 34.13 3.41 0.32 » 5.65 10.05% 18.86%
Corning, Inc. GLW $31.3 Billion $20.21 10.99 1.91 » 55.95 5.72 0.42 » 10.60 6.96% 22.12%
The DIRECTV Group, Inc. DTV $30.9 Billion $33.81 8.69 3.08 » 91.74 1.45 0.58 » 4.87 13.68% 22.88%
China United Network Communications Ltd. CHU $26.5 Billion $11.15 2.31 1.78 » 14.80 1.17 0.56 » 6.38 21.71% 8.64%

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Delevoping Economies and Where CHA Fits In on Tech Trader Daily-Barron’s

News related to emerging markets affecting China Telecom Corporation Limited today, and Tech Trader Daily-Barron’s discussed some recent developments.

Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey. The Ockham valuation currently has a Fairly Valued stance on CHA because it trades within the price range that we would expect given current market conditions and fundamentals. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, China Telecom Corporation Limited has actually sunk a bit in comparison to the others.

“… (That list includes Sprint (S), CHINA TELECOM, KDDI in Japan and SK Telecom in South Korea. ) Before you get too excited, let me note that it could still be a while before there … …”

WSJ Marketbeat: Topics Include Emerging Markets and CHA

News related to emerging markets affecting China Telecom Corporation Limited today, and WSJ Marketbeat discussed some recent developments.

The Ockham valuation currently has a Fairly Valued stance on CHA because it trades within the price range that we would expect given current market conditions and fundamentals. When taking into account the amount of news coverage each stock normally sees as a percentage of the total, China Telecom Corporation Limited has actually sunk a bit in comparison to the others. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey.

“… a launch of a CDMA-based phone with Verizon this year is unlikely but believe a CDMA phone could be launched with other operators later in the year (CHINA TELECOM and KDDI are … …”

Delevoping Economies and Where CHA Fits In on Tech Trader Daily-Barron’s

For growth, there is nowhere growing more rapidly than emerging markets. Recently, Tech Trader Daily-Barron’s talked about emerging markets and their impact on China Telecom Corporation Limited.

When taking into account the amount of news coverage each stock normally sees as a percentage of the total, China Telecom Corporation Limited has actually sunk a bit in comparison to the others. The Ockham valuation currently has a Fairly Valued stance on CHA because it trades within the price range that we would expect given current market conditions and fundamentals. Crowd sentiment is favorable on this stock, as measured by the Motley Fool CAPS survey.

“… The piece noted that CHINA TELECOM (CHA) this week said it expects to start selling BlackBerry phones in May. The IDG piece said a China Unicom exec revealed the talks with RIMM … …”

CHA in Developing Markets on Tech Trader Daily-Barron’s

China Telecom Corporation Limited and an emerging market growth strategy were discussed recently on CHA.

The Motley Fool CAPS data suggests that investors believe China Telecom Corporation Limited will beat the market in the foreseeable future. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on CHA. As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, CHA has been less covered in the news compared to the rest of our universe of stocks.

“… But the story notes that China Mobile recently said it is planning to trim capital spending this year, while CHINA TELECOM earlier this week said spending this year will be flat. …”

Earnings Discussion for China Telecom Corporation Limited on Asia Morning Call

The name of the game in business is profit, and we always pay attention for CHA news as it relates to earnings.

Crowd sentiment is leaning to the bearish side, according to the robust data set collected by the Motley Fool CAPS survey. We noticed recently that in comparison to all other stocks we analyze in the news; CHA has received less coverage from the financial media in business television and blogs. China Telecom Corporation Limited receives our Fairly Valued rating in our latest report because the current price does not seem out of line with the fundamentals.

“… We prefer CHINA TELECOM over china mall, as its earnings are growing much faster. > > thank you for joining us today. . …”

Closing Bell: Topics Include Emerging Markets and CHA

There is no doubt that the emerging markets are where the growth is right now. The latest news mention of CHA on Closing Bell was in relation to emerging markets.

As we analyze the results from RazorWire, one thing we do is rank each stock in terms of amount of news coverage. Recently, CHA has been less covered in the news compared to the rest of our universe of stocks. The Motley Fool CAPS data suggests that investors believe China Telecom Corporation Limited will beat the market in the foreseeable future. After factoring in the current fundamentals versus their historically normal ranges, we have established a Fairly Valued stance on CHA.

“… Although, really only one of the operators, CHINA TELECOM, has gotten their 3g kicked off as well as we’d like. We look to see some of the other operators pushing harder during … …”

China Telecom Corporation Limited (CHA) Discussed on CNBC’s Closing Bell

China Telecom Corporation Limited is in the news. Find out how this impacts CHA trading on Ockham Research.

>> announcer: time now for going global asia. >>> we’re just getting started stories to watch. We’ll be keeping an eye out for earnings from bank of china. The state-run lender with the largest exposure to overseas and it’s widely expected to post a 12% drop in first half in the meantime CHINA TELECOM, the country’s largest fixed line operator by subscribers is likely to record a 34% slump in its first half earnings, dragged down by hefty handset subsidies. >>> on the flip side, q1 profits from india’s tata steel looking to soar on reports of higher prices and improving demand. Tune in to cnbc world to catch all the action overseas. At cnbc’s asia headquarters i’m adam bakhtiar going global with your money. >>> well, high-yield bond funds have had a good month so far.E 30-plus percent year returns attracting almost $15 billion in

“… rop in first half in the meantime CHINA TELECOM, the country’s largest fixed line operator by subscribers is likely to record a 34% slump in its first half earnings, dragged down by hefty handset subsidies. >>> on the flip side, q1 profits from india’s tata steel looking to soar on reports of higher prices and improving demand. Tune in to cnbc world to catch all the action overseas. At cnbc’s asia headquarters i’m adam bakhtiar going global with your money. >>> well, high-yield bond funds have had a good month so far.E 30-plus percent year returns attracting almost $15 billion in …”

China Telecom Corporation Limited (CHA) Discussed on CNBC’s Squawk On The Street

China Telecom Corporation Limited is in the news. Find out how this impacts CHA trading on Ockham Research.

International trade commission law judge ruled nokia did not infringe on the patent. They’re going to appeal and protest that situation. Dell is going to enter the handset market. All very vague and loose right now, but CHINA TELECOM spokesman said they worked out some sort of a deal here, china mobile, mini 3i will be the newest handset. Weakest in the nasdaq was garmin, down 1.8% today. They are in talks chasing a company called way marine which does gps, as you would expect. Let’s get down to brian shactman >> we weakened 30 cents since mark gave an interesting take in the correlation of the equities and the dollar. The dollar is a factor here. Equities, the storm, empire state manufacturing gave us a little bit of a reprieve.

“… orked out some sort of a deal here, china mobile, mini 3i will be the newest handset. Weakest in the nasdaq was garmin, down 1.8% today. They are in talks chasing a company called way marine which does gps, as you would expect. Let’s get down to brian shactman >> we weakened 30 cents since mark gave an interesting take in the correlation of the equities and the dollar. The dollar is a factor here. Equities, the storm, empire state manufacturing gave us a little bit of a reprieve. …”

China Telecom Corporation Limited (CHA) Discussed on Fox Business’s Happy Hour

China Telecom Corporation Limited is in the news. Find out how this impacts CHA trading on Ockham Research.

We talked about it after hours yesterday. Good numbers out of oracle, they crushed earnings. Also rim up a little more than 2 they’re in talks with CHINA TELECOM to do a deal with rim. And yahoo up 5 percent, and that’s on possible renewed talks between yahoo! And microsoft. Next screen.

“… ahoo! And microsoft. Next screen. …”

China Telecom Corporation Limited (CHA) Discussed on CNBC’s Power Lunch

China Telecom Corporation Limited is in the news. Find out how this impacts CHA trading on Ockham Research.

>> tim, you’re watching r.I.M., >> this whole story that china is going to be a driver for the iphone is in the news, but r.I.M. Is talking about doing something with CHINA TELECOM and this will come down to how they can deal with the chinese government. People are buying growth ofthere. People are buying these names. >> the other big mover today, yahoo up 4%.

“… People are buying growth ofthere. People are buying these names. >> the other big mover today, yahoo up 4%. …”

View All China Telecom Corp. Limited Stock News

Key Fundamentals

CHA – China Telecom Corporation Limited Fundamentals
Price (4/1 4:00PM) $50.41
Volume (4/1 4:00PM) 119,601
Last Close Price $48.99
10 Day Average Volume 154,200
13 Week Price Range $40.28 – $50.46
52 Week Price Range $40.28 – $56.41
LTM Revenue $30.7 Billion
 
Shares Outstanding (12/2009) 809.3 Million
Market Capitalization $39.6 Billion
Shares Held By Institutions 6.2 Million
Institutional Holders 83
% Shares Held By Institutions 4.50%
Earnings Per Share (EPS) $2.64
P/E Ratio 18.60
Book Value Per Share $39.08
 
Gross Margin n/a%
Annual Dividend 0.99
Dividend Yield 2.00%
Beta 1.27
Fiscal Year Ends December

About China Telecom Corp. Limited

China Telecom Corporation Limited is considered to operate in the Technology sector. They specifically operate in the Telecom Services/Foreign business segment contained within the Telecommunications industry.

The Company is an integrated information service provider in the PRC with full-service capabilities.