STARHUB Analysis
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Summarised from Fool.sg dated January 3, 2014
StarHub also exhibits a reasonably high margin; its Net Income Margin of 15% is on a par with other Singapore blue chip stocks; StarHub could generate $15 of bottom-line profit for every $100 of top-line sales. By comparison, the average Net Income Margin for the 30 companies that make up the Straits Times Index (SGX: ^STI) is 19%.
StarHub is quite efficient; its Asset Turnover of 1.4 is nearly three times better than the market average. It suggests that the telecom provider is able to generate $1.40 of sales for every dollar employed in the business. Singapore’s largest telecom company, SingTel (SGX: Z74), in contrast, generates around $0.50 for every dollar of asset.
Starhub has stock volatility (i.e. companies with low specific stock risk are better). StarHub’s share price volatility is 16%. The average volatility for Singapore blue chips is 18%.
Businesses that use excessive borrowings, which could make a company vulnerable to interest-rate hikes. StarHub is highly leveraged. Its Leverage Ratio of 41 is over 20 times higher than the market average.
