M1: will release 2Q10 results on 15 Jul. Our house expects M1 to continue its steady quarterly improvement in net profit, est $40-41m (+8-11% yoy and better than 1Q10’s $39.5m), due to higher margins. Subscriber net-adds should continue to be positive, driven by economic recovery, continued momentum in iPhone sales, and opportunities in mobile broadband. We expect costs to remain benign, given declining handset costs, leased circuit costs and stabilizing depreciation.
Catalysts include launch of the NGNBN, and possible capital management initiatives. We maintain Buy with $2.62 target.
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