Brokers' take

StarHub | Hold Target price: S$2.80 Jan 17 close: S$2.95 CIMB, Jan 16

Despite factoring in contributions from recently acquired cyber security solutions providers Accel Systems & Technologies and D'Crypt, we still expect StarHub's earnings before interest, taxes, depreciation and amortisation and core earnings per share to decline by 11.6 per cent and 35.6 per cent respectively from 2016 to 2020.

While we see fixed network services revenue growing healthily to a quarter of total service revenue by 2020, it will not be able to fully offset declining revenues at its mobile, pay-TV and broadband businesses, which make up the balance 75 per cent of service revenue. We also see little room for dividend per share to rise beyond S$0.16 in 2018 through 2020.