StarHub share price trashed to 14-year low

StarHub CEO, Peter Kaliaropoulos must be feeling the heat again. On 18 February 2019, StarHub share price plunged to a 14-year low of $1.61. The last time that StarHub share price was trading at such disgraceful level was in 2005. The trigger for the massive sell-offs was obviously the dismal Q4FY2018. Following the announcement, investors wasted no time in punishing this counter, sending StarHub share price to rock bottom.

It seems that honeymoon period is over for the StarHub CEO. Following his appointment on 9 July 2018, StarHub share price enjoyed a brief respite and even managed to halt its horrendous slump. Then the announcement of Keppel and SPH buy-over of M1 shares had led to a resurgent StarHub share price in September 2018. Investors had speculated that a potential privatization of M1 could lead to lower competition for StarHub.

StarHub share price

But reality started to sink in and investors soon realize that the previous rebound of StarHub share price was a mere false dawn in the making. The headwinds remained the same while business fundamentals continued to decline. In fact, full-year results for FY2018 saw StarHub reporting the worst revenue and net income in five years – $2.36 billion and $201 million respectively.

Welcome to the telco war, which has resulted in contract-free and unlimited data plans emerging in Singapore. For StarHub share price, it is a case of “ain’t over till it’s over” as the CEO launched a series of aggressive moves aimed at turning the tide. Against the intriguing backdrop of market shake-up, would StarHub share price ever see light at end of tunnel?

StarHub share price set to face destiny?

For the longest time, StarHub reigned supremacy in the Singapore Exchange, especially the period from 2013 to 2014, when it was trading at levels above SingTel and M1. The mighty form of StarHub share price was due to its massive appeal as a dividend stock among investors. Indeed, StarHub had been pretty generous with its dividend policy in the past.

But the winning form of StarHub share price was ruptured by several unfolding events in the past few years – Pay TV business being impacted by Over-the-Top Players (OTT) and piracy, entry of Mobile Virtual Network Operators (MVNO), new telco (TPG) and lower revenue from IDD calls. With the latest announcement of the cut in dividends from FY2019, I fear the worst for Starhub share price.

The full-year financial results came as shocking because [This is a premium article. The rest of the content is blocked and can be accessible by SG Wealth Builder Members only. To read the full content, please sign up as member.]

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Updated: February 19, 2019 — 11:53 pm

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