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Is this Large Market Cap Stock target price reasonable for China Telecom Corp. Ltd. (NYSE:CHA)?

The company in question is, China Telecom Corp. Ltd. (NYSE:CHA) currently with a stock price of 52.17 (-1.02% today). The market cap for China Telecom Corp. Ltd. is 41159.52, and is in the sector Technology, and Telecom Services – Foreign industry. The target price for China Telecom Corp. Ltd. is 60.75. Currently China Telecom Corp. Ltd. is trading with a P/E of 16.25, and a forward P/E of 12.79. Average volume for China Telecom Corp. Ltd. is 32.7 and so far today it is 74758.

Performance in the last year for China Telecom Corp. Ltd. has been -5.52%. For EPS growth, China Telecom Corp. Ltd. has seen a growth of -20.60%, and is looking to grow in the next year to 28.99%. More long term stats show that EPS growth has been 7.10% over the last five years and could be 3.60% for the next five years. China Telecom Corp. Ltd. has seen sales growth quarter over quarter at -31.80%, with EPS growth quarter over quarter at 1.40%. The 20-day simple moving average is 8.70%, with the 200-day simple moving average coming to 8.10%.

Since the IPO date for China Telecom Corp. Ltd. on the 11/14/2002, China Telecom Corp. Ltd. has seen performance year to date to be 12.31%. With China Telecom Corp. Ltd. trading at 52.17, the dividend yield is 2.36%, and the EPS is 3.21.

So could China Telecom Corp. Ltd., be undervalued? Well as said before P/E is 16.25. The PEG is 4.51, P/S is 0.84 and the P/B is at 0.92. The P/cash is 7.93, with P/free cash flow at *TBA.

China Telecom Corp. Ltd. ability to deal with debt shows that the current ratio is 0.3, and the quick ratio is 0.3. This is with long term debt/equity at 0.21, and total debt/equity at 0.38.

In terms of margins, China Telecom Corp. Ltd. has a gross margin of 75.60%, an operating margin of 8.20% and a profit margin of *TBA.Payout ratio for China Telecom Corp. Ltd. is *TBA. Return on assets come to *TBA with return on investment coming to 4.70%.

Insider ownership for China Telecom Corp. Ltd., is at 45.30% and institutional ownership comes to 3.40%. Outstanding shares are at 788.95. While shares float is 13.74. The float short is currently 0.52%, and short ratio is 2.18.

Disclaimer: Remember there is a risk to your investment, this is not a recommendation, nor personal advice, never invest more than you are able too loose.

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Mark Hines

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