As Optima Telekom recorded a stellar share price performance both YTD and in the past five days, we are bringing you a brief overview of the share price movement, turnover and the reasons for the increase.
As a reminder, on 31st May, the media has covered that the Swedish Tele2 AB announced on the sale of their Croatian subsidiary Tele2 Hrvatska. The sale of the Croatian segment was concluded with United Group for the value of EUR 220m (at 7.2x T12 EBITDA).
This is particularly interesting as Optima Telekom, which is currently consolidated and managed by HT will be subject to sale. As a reminder, HT should dispose of their 17.4% stake in Optima Telekom until 10 July 2021.
It is speculated by the media that United Group might be interested in acquiring Optima Telekom, as the company’s business is majority related to fixed broadband, which is a segment TELE2 Hrvatska does not operate in. Such an acquisition would lead to a consolidation of all majority telecom segments on the Croatian market by the United Group.
As a result of the above mentioned, many investors have flocked to the share, which is noticeable when observing the company’s high turnover in the past days and the share price performance. Since 31st May (until 6 June), Optima observed a turnover of HRK 8.6m, which would translate to an average daily turnover of HRK 1.7m. As a comparison, since the beginning of the year (until 30 May), Optima observed a turnover of HRK 30.3m, which would translate to an average daily turnover of HRK 0.29m.
Turning our attention to the share price performance, since 31 May, Optima recorded an increase of 56% and currently amounts to HRK 5.0 per share (closing price 6 June). Note that since the beginning of the year, the company’s share price increased by 196%.
YTD Share Price Performance
At the current share price, the company is traded at P/T12E of 54.24 and EV/T12 EBITDA of 5.22. When comparing it to its peers, Optima is traded at a significantly higher P/E and at an above average EV/EBITDA. However, note that these companies are not the best suiting peers as they differ in size and business model (Optima is focused on fixed broadband).
Comparing P/E and EV/EBITDA to Peers
On the 6th June Končar held its General Assembly where shareholders approved HRK 15 DPS which at the current share price translates into dividend yield of 2.2%. We have also looked at Končar’s share price performance and it has YTD increased by 30%.
General Assembly also proposed the ex-dividend date to be June 20th 2019. Until then all investors that are looking to receive dividend should buy share and the record date to be registered as shareholder’s is 21 June 2019. All members of the Management Board and the Supervisory Board were given a dismissal for the work done in 2018, and auditor for 2019 will be Pricewatehouse Coopers. In the graph below, we are bringing you a historic overview of the company’s dividend per share. Company’s average dividend yield has in the last five years amounted to 1.9%.
Dividend per share 2015-2019 (HRK)
In May Končar share’s total turnover has amounted to HRK 19.7m, while the market capitalisation of the company amounts to HRK 1.8bn. Končar was the 4th most traded share on ZSE in May, while its average turover per day has amounted to HRK 0.9m. In May company’s share price has increased 5.3%, while YTD capital gain amounts to 30%. In 2019 Erste pension funds managment company has showed interest in the share and it has increased its exposure to Končar. On 28th February 2019 Končar showed good set of financial results for 2018 as its EBITDA margin increased for 70bp to 7.3%. Its operating revenues in a year have decreased slightly (-3.3%YoY) while in 2019 the company continued to dispose companies that entail its minor businesses like Končar household appliances and Končar-LE that was sold to Italian company Lovato Electric S.P.A. Company’s good results and interest from institutional investors could have influenced share price increase.
YTD share price performance