788 HK

China Tower Corporation Limited

TMT


Presented:01/16/2019
Price:HK$1.54
Cap:$34.95B
Current Price:HK$1.08
Cap:$24.35B

Presented

Date01/16/2019
PriceHK$1.54
Market Cap$34.95B
Ent Value$35.61B
P/E RatioN/A
Book ValueHK$0.85
Div Yield0%
Shares O/S176,009.00M
Ave Daily Vol408,104,089
Short IntN/A

Current

PriceHK$1.08
Market Cap$24.35B
China Tower Corp., Ltd. engages in providing telecommunications tower infrastructure services. It provides services to tower, DAS, transmission and service products. The company was founded in July 2014 and is headquartered in Beijing, China.

Publicly traded companies mentioned herein: China Mobile Ltd (CHL), China Telecom Corp Ltd (728 HK), China Tower Corp Ltd (788 HK), China Unicom Hong Kong Ltd (CHU), Sprint Corp (S), T-Mobile US Inc (TMUS)

Highlights

The presenter is long shares of China Tower Corp (788 HK), the telecommunication tower infrastructure company that owns most of the cell phone towers in China. He views the stock as undervalued at its current price of ~HKD1.50, due in part to EBITDA expansion through the 5G rollout. Further EBITDA growth is possible due to the presenter’s belief that the company is mismodeled by analysts. He feels this lack of understanding has suppressed revenue figures. Another catalyst discussed by the presenter is possible EBITDA multiple growth as investors become more comfortable with Chinese telecommunication companies, which have underperformed recently. Currently trading at ~7x his 2019 EBITDA estimate and ~6.5x 2020 EBITDA, he sees short-term risk of ~18% and a potential double on the upside over the 5G rollout period.

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Idea Discussion

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