StarHub (CC3) AI Stock Analysis

• Market Cap: $1.96B
• Dividend Yield: 5.44%
• Average Volume (3M): 1.11M
• Price to Earnings (P/E): 15.9
• Beta (1Y): 0.38
• Revenue Growth: 0.83%
• EPS Growth: -16.65%
• Country: SG
• Employees: 1,635
• Sector: Communication Services
• Sector Strength: 97
• Industry: Telecommunications Services
• EPS (TTM): 0.01
• Shares Outstanding: 1,731,651,500
• 10 Day Avg. Volume: 868,660
• 30 Day Avg. Volume: 1,108,553
• PEG Ratio: 0.94
• Price to Book (P/B): 3.42
• Price to Sales (P/S): 0.88
• P/FCF Ratio: 12.81
• Enterprise Value/Market Cap: 1.70
• Enterprise Value/Revenue: 1.39
• Enterprise Value/Gross Profit: 2.72
• Enterprise Value/Ebitda: 7.41
• 1Y Price Target: $1.19
• Price Target Upside: 4.78% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 3

• Rating: 69 Neutral
• Price Target: S$1.00 ▼(-12.28% Downside)

StarHub's overall stock score is driven by its solid financial performance, particularly in profitability and cost management, despite high leverage. The valuation is attractive with a reasonable P/E ratio and strong dividend yield. Technical analysis presents a neutral outlook, with no strong trends indicated by the moving averages and momentum indicators.

Positive Factors

Profit Margin Improvement

The substantial improvement in gross profit margin indicates effective cost management, enhancing profitability and providing a buffer against market volatility.

Cash Flow Stability

Stable operating cash flow suggests strong cash generation ability, supporting ongoing operations and potential investments without relying heavily on external financing.

Return on Equity

An improving return on equity reflects enhanced profitability and efficient use of shareholder funds, which can drive long-term shareholder value.

Negative Factors

High Leverage

High leverage can increase financial risk, particularly in volatile markets, potentially impacting the company's ability to invest in growth or weather economic downturns.

Decline in Free Cash Flow

A decline in free cash flow suggests reduced cash availability for discretionary spending, which may limit the company's ability to invest in growth opportunities or return capital to shareholders.

Revenue Decline

A slight decline in revenue may indicate challenges in market expansion or competitive pressures, potentially impacting long-term growth prospects if not addressed.

StarHub Business Overview & Revenue Model

Company Description

StarHub Ltd, an integrated info communications company, provides communications, entertainment, and digital solutions for individuals and corporations in Singapore. The company operates in four segments: Telecommunications, Cyber Security, High Security Assurance Product, and Regional Information Communication Technology. The company provides television subscription and broadcasting services; broadband access, high speed wholesale broadband, and information security systems integration services; security consultancy services; information security and network security surveillance services; petrol station retail and fuel logistics management solutions; hospital information systems solutions; business application solutions and related services; data center and business continuity services; healthcare information technology products and services; and healthcare information technology software, research and development, and support services. It also engages in computer systems integration, other professional, scientific, and technical activities; development and supply of data security products and components; provision of information security and network security surveillance services; sales of information technology security related products; implementation of information communication technology projects; and system integration, supply and implementation of hardware and software solutions, and provision of maintenance services. Further, the company is involved in the development and provision of software as a service application; provision of architecting ICT solutions and project management services; and investment holding and provision of management services. The company was incorporated in 1998 and is headquartered in Singapore. StarHub Ltd is a subsidiary of Asia Mobile Holdings Pte. Ltd.

How the Company Makes Money

StarHub generates revenue primarily through its telecommunications services, which include mobile voice and data plans, fixed broadband, and pay television subscriptions. The company also earns income from enterprise solutions, offering services such as cloud computing, cybersecurity, and managed services to businesses. Additionally, StarHub partners with global technology and content providers to offer bundled services and exclusive content, enhancing its value proposition to customers. These partnerships and a diversified service portfolio contribute significantly to the company's earnings.

StarHub Financial Statement Overview

Summary

StarHub's financial health is characterized by stable revenue and improving profit margins, reflecting effective cost management. The balance sheet shows strong profitability with a high return on equity, although the high leverage ratio is a potential risk factor. Cash flow stability is evident, but the decline in free cash flow suggests a need for cautious capital management.

Income Statement

StarHub's income statement reveals a stable revenue with a slight decline from $2.373 billion in 2023 to $2.368 billion in 2024. The gross profit margin improved significantly from 29.5% in 2023 to 53.2% in 2024, indicating better cost management. The net profit margin also improved from 6.0% to 6.8%, showing enhanced profitability. However, the EBIT margin slightly decreased from 9.5% to 9.5%, and the EBITDA margin increased from 16.6% to 20.4%, showing mixed results in operational efficiency.

Balance Sheet

The balance sheet indicates a debt-to-equity ratio of 2.08, suggesting a high leverage position, which could pose a risk in volatile market conditions. The return on equity improved to 26.4% in 2024, up from 24.9% in 2023, reflecting better profitability. The equity ratio stands at 19.5%, indicating a moderate level of equity financing. Overall, while profitability is strong, the high debt level remains a concern.

Cash Flow

Operating cash flow showed stability, increasing slightly from $358.6 million in 2023 to $361.3 million in 2024. Free cash flow decreased from $185.9 million to $162.2 million, indicating a decline in cash available after capital expenditures. The operating cash flow to net income ratio remains healthy at 2.25, suggesting efficient cash generation relative to net income. However, the decrease in free cash flow highlights potential challenges in sustaining cash reserves.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	2.39B	2.37B	2.37B	2.33B	2.04B	2.03B
Gross Profit	1.22B	1.26B	700.60M	1.14B	1.07B	470.60M
EBITDA	449.00M	481.30M	393.30M	400.70M	513.20M	539.60M
Net Income	126.30M	160.50M	141.70M	62.20M	149.30M	157.90M
Balance Sheet
Total Assets	3.24B	3.12B	3.04B	3.13B	3.24B	2.93B
Cash, Cash Equivalents and Short-Term Investments	487.10M	539.60M	509.60M	573.60M	832.80M	415.40M
Total Debt	1.45B	1.26B	1.24B	1.27B	1.50B	1.53B
Total Liabilities	2.50B	2.35B	2.33B	2.45B	2.55B	2.50B
Stockholders Equity	583.30M	607.80M	568.80M	530.40M	589.50M	538.30M
Cash Flow
Free Cash Flow	-111.30M	162.20M	185.90M	222.20M	484.60M	344.50M
Operating Cash Flow	294.30M	361.30M	358.60M	383.70M	657.10M	535.70M
Investing Cash Flow	-394.20M	-101.90M	-224.90M	-235.00M	-286.90M	-237.50M
Financing Cash Flow	28.80M	-221.80M	-209.60M	-403.60M	47.80M	-11.40M

StarHub Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 1.14
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SG:CC3, the sentiment is Positive. The current price of 1.14 is above the 20-day moving average (MA) of 1.14, below the 50-day MA of 1.14, and above the 200-day MA of 1.14, indicating a neutral trend. The MACD of >-0.01 indicates Negative momentum. The RSI at 52.53 is Neutral, neither overbought nor oversold. The STOCH value of 77.78 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SG:CC3.

StarHub Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Z74	76 Outperform	$70.31B	17.50	16.56%	2.89%	0.13%	404.98%
CJLU	75 Outperform	$3.74B	39.18	3.90%	5.58%	-1.04%	-7.55%
CC3	69 Neutral	$1.96B	15.92	32.00%	5.44%	0.83%	-16.65%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%

StarHub Corporate Events

StarHub Transfers Treasury Shares for Stock Plan

StarHub Ltd has announced the transfer of 95,332 treasury shares as part of fulfilling share awards under its Restricted Stock Plan 2014. This transfer slightly reduced the company’s treasury shares from 0.549% to 0.544% of the total issued shares, reflecting a strategic move to incentivize and retain talent, which could impact the company’s market positioning and stakeholder interests.

The most recent analyst rating on (SG:CC3) stock is a Hold with a S$1.19 price target. To see the full list of analyst forecasts on StarHub stock, see the SG:CC3 Stock Forecast page.