STOCKS NEWS SINGAPORE-StarHub up; Maybank upgrades stock after results
Maybank Kim Eng raised its rating on StarHub Ltd to 'buy' from 'sell,' impressed by the company's 27 percent rise in quarterly profit and said fourth-quarter results could also beat expectations as the negative impact of iPhones on margins could be fading.
The broker said that with third-quarter margins at 33.9 percent versus full-year outlook of 30 percent, Singapore's second-biggest telecom firm has "a good chance of doing better than expected." Maybank raised its target price to S$3.99 from S$3.06.
StarHub's shares were up 0.6 percent at S$3.67 in a weak market and have risen 26 percent so far this year, outpacing a 14 percent rise in the index. The stock has eased after hitting a record high of S$3.88 in early August.
HSBC also raised its rating on StarHub to 'neutral' from 'underweight,' partly helped by the company's better operating margins.
Maybank said StarHub's gearing fell to a record low of 0.46 times in the third quarter following its recent raising of S$220 million in medium-term notes, and this raises confidence in sustained dividend.
Ahead of the results, 13 brokers had a 'hold' rating on StarHub, with nine rating it a 'sell' or 'strong sell,' one had a 'buy' rating and one had a 'strong buy' recommendation.
StarHub earns all its revenue from Singapore. Quarterly net profit at smaller rival M1 Ltd fell 19.5 percent. Singapore Telecommunications Ltd reports results this month.
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DAVOS, Switzerland - Central banks have done their best to rescue the world economy by printing money and politicians must now act fast to enact structural reforms and pro-investment policies to boost growth, central bankers said on Saturday.