Spark New Zealand (SPKKY) AI Stock Analysis

• Market Cap: $2.29B
• Dividend Yield: 12.64%
• Average Volume (3M): 134.81K
• Price to Earnings (P/E): 19.5
• Beta (1Y): 0.50
• Revenue Growth: -5.72%
• EPS Growth: -57.16%
• Country: US
• Employees: 5,144
• Sector: Communication Services
• Sector Strength: 83
• Industry: Telecommunications
• EPS (TTM): 0.32
• Shares Outstanding: 368,821,440
• 10 Day Avg. Volume: 152,693
• 30 Day Avg. Volume: 134,812
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 2.21
• Price to Cash Flow (P/CF): N/A
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0

Spark New Zealand's overall score is driven by a combination of solid financial performance with strong operational efficiencies and attractive valuation due to a high dividend yield. However, concerns about declining net income and high leverage weigh on the score. Technical indicators show mixed signals, and the lack of detailed earnings call data leaves future guidance uncertain.

Spark New Zealand Business Overview & Revenue Model

Company Description

Spark New Zealand Ltd. engages in the provision of telecommunications and information and communications technology (ICT) services. It operates through the following segments: Spark Home, Mobile and Business; Spark Digital; Spark Connect & Platforms, and Spark Ventures & Wholesale. The Spark Home, Mobile & Business segment provides fixed line, mobile, and internet services. The Spark Digital segment integrates information technology and telecommunications services to provide converged ICT solutions. The Spark Connect & Platforms segment includes the group's network and information technology and shared business operations, and servicing of wholesale and international customers. The Spark Ventures & Wholesale segment involves in the development of a portfolio of new businesses and services and the stewardship of Spark's wholesale products and services. The company was founded on February 24, 1987 and is headquartered in Auckland, New Zealand.

How the Company Makes Money

Spark New Zealand generates revenue through a diversified business model that includes several key streams. The company earns income from mobile services, including voice, data, and messaging, which are provided to both prepaid and postpaid customers. Broadband services are another significant revenue source, offering a variety of internet plans to households and businesses. Additionally, Spark derives earnings from its digital services and cloud computing solutions, catering to the increasing demand for digital transformation among enterprises. The company also benefits from strategic partnerships and collaborations that enhance its product offerings and market reach. These revenue streams are supported by Spark's investments in network infrastructure and technology innovation, ensuring reliable and high-quality service delivery.

Spark New Zealand Financial Statement Overview

Summary

Spark New Zealand's financial performance shows strong operational efficiencies and stable gross margins. However, declining net income has affected profitability and return on equity. The balance sheet indicates higher leverage, which could pose risks if not managed carefully. Strong operating cash flows sustain liquidity, but the company should improve cash flow management and reduce debt to enhance financial health.

Income Statement

Spark New Zealand has demonstrated steady revenue performance over the years, although there was a decline in total revenue from $3.875 billion in 2023 to $3.759 billion in 2024. The gross profit margin remains strong, indicating effective cost management, with a margin of approximately 51.5% for 2024. However, the net profit margin decreased significantly from 29.3% in 2023 to 8.4% in 2024, primarily due to a substantial drop in net income. EBIT and EBITDA margins are strong, showing operational efficiency, but there's a need to address the drop in net income to ensure profitability.

Balance Sheet

The company's balance sheet shows moderate financial leverage with a debt-to-equity ratio of 1.48 in 2024, indicating a higher reliance on debt financing. The equity ratio is stable at around 34.3%, suggesting a balanced asset financing strategy. Return on equity has dropped from 58.5% in 2023 to 19.9% in 2024, highlighting pressure on profitability. The company needs to manage its debt levels and improve equity returns to enhance financial stability.

Cash Flow

Operating cash flow remains robust, slightly declining from $791 million in 2023 to $764 million in 2024, supporting the company's liquidity. Free cash flow decreased from $310 million to $164 million, reflecting higher capital expenditures. The operating cash flow to net income ratio is strong, indicating good cash generation relative to net income. However, the free cash flow to net income ratio has weakened, suggesting a need for more effective cash management strategies.

Breakdown
Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
3.76B	3.88B	3.69B	3.56B	3.59B
	Gross Profit
1.94B	2.01B	1.94B	1.89B	1.93B
	EBIT
1.16B	1.19B	621.00M	593.00M	608.00M
	EBITDA
1.10B	1.75B	1.18B	908.00M	1.14B
	Net Income Common Stockholders
316.00M	1.14B	410.00M	384.00M	427.00M
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
59.00M	100.00M	71.00M	72.00M	53.00M
	Total Assets
4.63B	4.48B	4.19B	4.11B	4.35B
	Total Debt
2.36B	1.83B	1.87B	1.87B	2.04B
	Net Debt
2.30B	1.73B	1.80B	1.80B	1.99B
	Total Liabilities
3.04B	2.54B	2.71B	2.61B	2.85B
	Stockholders Equity
1.59B	1.94B	1.48B	1.50B	1.49B
Cash Flow		Free Cash Flow
164.00M	310.00M	408.00M	461.00M	502.00M
	Operating Cash Flow
764.00M	791.00M	833.00M	847.00M	895.00M
	Investing Cash Flow
-550.00M	425.00M	-492.00M	-388.00M	-411.00M
	Financing Cash Flow
-255.00M	-1.20B	-350.00M	-451.00M	-493.00M

Spark New Zealand Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 6.20
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Positive
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SPKKY, the sentiment is Negative. The current price of 6.2 is below the 20-day moving average (MA) of 6.83, below the 50-day MA of 7.67, and below the 200-day MA of 9.76, indicating a bearish trend. The MACD of -0.45 indicates Negative momentum. The RSI at 23.24 is Positive, neither overbought nor oversold. The STOCH value of 23.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SPKKY.

Spark New Zealand Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
T	76 Outperform	$190.80B	17.49	10.54%	4.25%	-0.08%	-24.48%
TMUS	76 Outperform	$292.26B	26.81	17.93%	1.18%	3.62%	38.24%
VZ	73 Outperform	$183.42B	10.54	18.27%	6.14%	0.61%	50.39%
SPKKY	71 Outperform	$2.29B	19.45	12.67%	12.64%	-5.72%	-57.16%
USM	65 Neutral	$5.56B	―	-0.85%	―	-3.48%	-169.60%
Sector *	59 Neutral	$29.33B	-0.37	-15.56%	4.08%	1.99%	-47.30%
LUMN	49 Neutral	$4.94B	―	-12.49%	―	-9.95%	99.47%