China Mobile and China Unicom are also slipping in value
Shares of China Telecom slipped by about 5% this week after Zacks downgraded the stock to a “Sell” rating from a “Hold” rating on June 17.
In general, the stock has declined steadily over the past month – losing more than a quarter of its value since mid-May.
Shares of China Telecom closed at $59.50 on June 18, down 27.4% from a closing price of $72.90 on May 15. It has traded as low as $48.04 and as high as $78.28 in the past year.
The Chinese state-owned telecom company operates local telephone networks in 10 provinces in China, as well as domestic and international fixed-line networks and infrastructure with a market cap of $48 billion.
TheStreet also has a “Hold” rating on China Telecom’s stock, citing weaknesses such as a disappointing return on equity, deteriorating net income and feeble growth in the company’s earnings per share. On the positive side, TheStreet cited a solid stock price performance, attractive valuation levels and expanding profit margins.
In late May, analysts at Jefferies Group upgraded the stock to a “Buy” rating from a “Hold” rating. And analysts at Sanford C. Benstein upgraded shares to an “Outperform” rating from a “Market Perform” rating in mid-April.
China Telecom also recently announced an annual dividend, which will be paid on July 27th. Investors of record on June 1 will be paid a dividend of $1.283 per share, representing a dividend yield of 1.8%.
Meanwhile, the country’s other state-owned telecommunications companies have also seen stock declines over the past month.
Still, on June 3 Zacks ranked China Mobile’s stock as “Buy,” citing expected earnings growth of 16.2% for the current year. Shares of China Mobile – the world’s largest carrier – closed at $64.51 on June 18, down 7% from $69.58 on May 15.
Meanwhile, China Unicom‘s stock closed at $15.69 on June 18, down 14% from a closing price of $18.29 on May 15.
