Are you still doubtful about Telekom Malaysia
 | By Rifka Kats | Macroaxis Story |
In spite of rather sluggish fundamental drivers, Telekom Malaysia exhibited solid returns over the last few months and may actually be approaching a breakup point. Macroaxis considers Telekom Malaysia out of control given 1 month investment horizon. Telekom Malaysia Berhad owns Efficiency Ratio (i.e. Sharpe Ratio) of 0.169 which indicates the firm had 0.169% of return per unit of risk over the last 1 month. Our philosophy towards measuring volatility of a stock is to use all available market data together with stock specific technical indicators that cannot be diversified away. By inspecting Telekom Malaysia Berhad technical indicators you can presently evaluate if the expected return of 0.7033% is justified by implied risk. Please operate Telekom Malaysia to confirm if our risk estimates are consistent with your expectations.
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Reviewed by Ellen Johnson
Telekom Malaysia has accumulated 2.21B in total debt with debt to equity ratio (D/E) of 168.0 indicating Telekom Malaysia Berhad may have difficulties to generate enough cash to satisfy its financial obligations. This firm has Current Ratio of 1.23 suggesting that it may not be capable to disburse its financial obligations in time and when they become due. The firm dividends can provide a clue to current valuation of the stock. The entity is not expected to issue dividends this year as it trying to preserve or re-invest any of the funds available for distribution to stakeholders. Lets now check Telekom Malaysia EBITDA. According to company disclosure Telekom Malaysia Berhad reported earnings before interest,tax, depreciation and amortization of 921.08M. This is much higher than that of the sector, and significantly higher than that of EBITDA industry, The EBITDA for all stocks is notably lower than the firm.
Typically, a company's financial statements are the reports that show the financial position of the company. There are three main documents that fall into the category of financial statements. These documents include Telekom Malaysia income statement, its balance sheet, and the statement of cash flows. Potential Telekom Malaysia investors and stakeholders use financial statements to determine how well the company is positioned to perform in the future. Although Telekom Malaysia investors may use each financial statement separately, they are all related. The changes in Telekom Malaysia's assets and liabilities, for example, are also reflected in the revenues and expenses that we see on Telekom Malaysia's income statement, which results in the company's gains or losses. Cash flows can provide more information regarding cash listed on a balance sheet, but not equivalent to net income shown on the income statement. Please read more on our technical analysis and fundamental analysis pages.
The goal of Telekom Malaysia fundamental analysis is to do accurate financial forecasts. There are several possible objectives to fundamental analysis, such as projecting of Telekom Malaysia performance into the future periods or doing a reasonable stock valuation. The intrinsic value of Telekom Malaysia shares is the value that is considered the true value of the share. If the intrinsic value of Telekom is higher than its market price, buying is generally recommended. If it is equal to the market price, it is recommended to hold; and if it is less than the market price, then one should sell all shares Telekom Malaysia. Please read more on our fundamental analysis page. Watch out for price decline
Please consider monitoring Telekom Malaysia on a daily basis if you are holding a position in it. Telekom Malaysia is trading at a penny-stock level, and the possibility of delisting is much higher compared to other pink sheets. However, just because the pink sheet is trading under one dollar, does not mean it will be marked for deletion. Most exchanges require public instruments, such as Telekom Malaysia stock to be traded above the $1 level to remain listed. If Telekom Malaysia pink sheet price falls below $1 for 30 consecutive trading days, the exchange can delist it. Once the company reaches this point, they will be sent an initial price violation notice directly from an exchange.
And What about dividends?
A dividend is the distribution of a portion of Telekom Malaysia earnings, decided and managed by the company's board of directors and paid to a class of its shareholders. Note, announcements of dividend payouts are generally accompanied by a proportional increase or decrease in a company's stock price. Telekom Malaysia dividend payments follow a chronological order of events, and the associated dates are important to determine the shareholders who qualify for receiving the dividend payment. Telekom one year expected dividend income is about USD0.01 per share.
Investing in stocks that pay dividends, such as pink sheet of Telekom Malaysia Berhad, is one of many strategies that are good for long-term investments. Ex-dividend dates are significant because investors in Telekom Malaysia must own a stock before its ex-dividend date to receive its next dividend.
This type of analysis is very useful when you want to generate a past dividend schedule and payout information for Telekom Malaysia. Then that information in the form of graph and calendar can be used to fully explain how Du Pont dividends can provide a real clue to its valuation.How important is Telekom Malaysia's Liquidity
Telekom Malaysia financial leverage refers to using borrowed capital as a funding source to finance Telekom Malaysia Berhad ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. Telekom Malaysia financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Financial leverage can amplify the potential profits to Telekom Malaysia's owners, but it also increases the potential losses and risk of financial distress, including bankruptcy, if the firm cannot cover its debt costs. The degree of Telekom Malaysia's financial leverage can be measured in several ways, including by ratios such as the debt-to-equity ratio (total debt / total equity), equity multiplier (total assets / total equity), or the debt ratio (total debt / total assets). Please check the breakdown between Telekom Malaysia's total debt and its cash.
What is driving Telekom Malaysia Investor Appetite?
The company has beta of 0.45. As returns on market increase, Telekom Malaysia returns are expected to increase less than the market. However during bear market, the loss on holding Telekom Malaysia will be expected to be smaller as well. The latest price spikes of Telekom Malaysia may encourage investors to take a closer look at the company as it closed today at a share price of 0.81 on 1.000 in trading volume. The company executives were quite successful positioning the company components to exploit market volatility in August 2019. The stock standard deviation of daily returns for 30 days (very short) investing horizon is currently 4.1608. This high volatility is attributed to the latest market swings and not so good earning reports for some of the Telekom Malaysia Berhad partners. Telekom Malaysia reports 24.19b total asset. Telekom Malaysia is selling for 0.81. Started trading at 0.81. To conclude, our analysis show that Telekom Malaysia Ignores market trends. The firm is overvalued and projects probability of distress below average for the next 2 years. Our primary buy or sell advice on the firm is Strong Sell.
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