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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 49.45 (-2.62% today). The market cap for China Telecom Corp. Ltd. is 42308.37, 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 15.9, and a forward P/E of 13. Average volume for China Telecom Corp. Ltd. is 33.55 and so far today it is 7467.

Performance in the last year for China Telecom Corp. Ltd. has been -2.91%. For EPS growth, China Telecom Corp. Ltd. has seen a growth of -17.60%, and is looking to grow in the next year to 19.19%. More long term stats show that EPS growth has been 7.10% over the last five years and could be 16.90% 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 10.40%. The 20-day simple moving average is -0.88%, with the 200-day simple moving average coming to 2.36%.

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 9.32%. With China Telecom Corp. Ltd. trading at 49.45, the dividend yield is 2.42%, and the EPS is 3.19.

So could China Telecom Corp. Ltd., be undervalued? Well as said before P/E is 15.9. The PEG is 0.94, P/S is 0.87 and the P/B is at 0.89. The P/cash is 8.2, 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 833.17. While shares float is 13.74. The float short is currently 0.40%, and short ratio is 1.65.

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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Stephen Butters

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