*Official* General Market Chit Chat Thread - Part 2

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thosai

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Asphodeli said:
it was from some "discussion" about whether M1 is using loans to pay for dividends...which is quite unlikely because there are provisions for impairment loss from profit recognition in accrual accounting, and the topic happened to the the exact same one which I was learning on Coursera.
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I wasnt meaning to say taking loans to pay div, its more like, with low cash and high loans already, still can pay high divs...
 
Mancunian2

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thosai said:
I wasnt meaning to say taking loans to pay div, its more like, with low cash and high loans already, still can pay high divs...
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is there moral hazard at play here?

after all, they can count on a bailout (being a GLC) if things turn sour
 
Perisher

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kage said:
Haha distract un from ur lesser profits.
Since today so much fireworks on m1, i decided to short m1 at 2.22 1000 shares for fun..

Buy u guys kopi if i earn kopi lui k...

Everybody cheers
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Quote for kopi. Vested in m1 though small position.
 
Shion

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Anyone (still) looking at these stocks...

Penguin
Cordlife
Spindex
 
Asphodeli

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yyhwin said:
Read carefully.
Quarter versus quarter is positive for starhub.

All 3 telcos are affected by the news of 4th telco, but M1 takes a larger hit.
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Sorry, I don't see any connection here...if you ask me, StarHub is actually burning cash more than M1...
 
Genosis

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Mancunian2 said:
how does it work?
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They lock customers into data plans and use most of the stable cash flow to pay dividends. Singtel is slightly more conservative in this aspect bcos it still needs retain some earnings to reinvest for expansion overseas. On the other hand, Starhub takes this aspect to the limit, paying out 100% of its earnings for many years as their growth is limited. It also has huge loans too.

Of course, every business has risks. Just like oil price is to O&G companies. The biggest risk to telcos is that one day, there will come a time when people stop using the internet and smartphones. Unlikely but still possible.....
 
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J

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Telcos have a predictable cash flow every year. Hence they should be comfortable with drawing down on cash reserves to pay for Capex or other expenses while paying out most of their earnings as dividends. Similar concept with REITs. The drawback will be the impact on growth opportunities as they do not have the cash for new investments unless they cut dividend payout.

Sent from Samsung SM-G900F using GAGT
 
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