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Spark New Zealand Limited (SPKKY)
:SPKKY

Spark New Zealand (SPKKY) AI Stock Analysis

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Spark New Zealand

(OTC:SPKKY)

71Outperform
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 (SPKKY) vs. S&P 500 (SPY)

Spark New Zealand Business Overview & Revenue Model

Company DescriptionSpark New Zealand (SPKKY) is a leading telecommunications and digital services company in New Zealand. It operates across multiple sectors, offering a comprehensive range of products and services including mobile, broadband, cloud computing, digital services, and data analytics. Spark is dedicated to providing innovative technology solutions to both individual consumers and businesses, enhancing connectivity and digital capabilities throughout the country.
How the Company Makes MoneySpark 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
78
Positive
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
72
Positive
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
75
Positive
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 2024Jun 2023Jun 2022Jun 2021Jun 2020
Income StatementTotal Revenue
3.76B3.88B3.69B3.56B3.59B
Gross Profit
1.94B2.01B1.94B1.89B1.93B
EBIT
1.16B1.19B621.00M593.00M608.00M
EBITDA
1.10B1.75B1.18B908.00M1.14B
Net Income Common Stockholders
316.00M1.14B410.00M384.00M427.00M
Balance SheetCash, Cash Equivalents and Short-Term Investments
59.00M100.00M71.00M72.00M53.00M
Total Assets
4.63B4.48B4.19B4.11B4.35B
Total Debt
2.36B1.83B1.87B1.87B2.04B
Net Debt
2.30B1.73B1.80B1.80B1.99B
Total Liabilities
3.04B2.54B2.71B2.61B2.85B
Stockholders Equity
1.59B1.94B1.48B1.50B1.49B
Cash FlowFree Cash Flow
164.00M310.00M408.00M461.00M502.00M
Operating Cash Flow
764.00M791.00M833.00M847.00M895.00M
Investing Cash Flow
-550.00M425.00M-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 Price6.41
Price Trends
50DMA
7.75
Negative
100DMA
8.21
Negative
200DMA
9.82
Negative
Market Momentum
MACD
-0.46
Positive
RSI
26.73
Positive
STOCH
82.62
Negative
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 6.41 is below the 20-day moving average (MA) of 7.01, below the 50-day MA of 7.75, and below the 200-day MA of 9.82, indicating a bearish trend. The MACD of -0.46 indicates Positive momentum. The RSI at 26.73 is Positive, neither overbought nor oversold. The STOCH value of 82.62 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for SPKKY.

Spark New Zealand Peers Comparison

Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name
Overall Rating
Market Cap
P/E Ratio
ROE
Dividend Yield
Revenue Growth
EPS Growth
TT
76
Outperform
$186.70B17.4410.54%4.27%-0.08%-24.48%
76
Outperform
$293.05B26.5617.93%1.19%3.62%38.24%
VZVZ
73
Outperform
$182.83B11.2118.27%6.18%0.61%50.39%
71
Outperform
$2.39B19.9012.67%12.35%-5.72%-57.16%
USUSM
65
Neutral
$5.49B-0.85%-3.48%-169.60%
59
Neutral
$29.20B0.14-12.92%4.06%2.18%-51.74%
49
Neutral
$4.94B-12.49%-9.95%99.47%
* Communication Services Sector Average
Performance Comparison
Ticker
Company Name
Price
Change
% Change
SPKKY
Spark New Zealand
6.41
-7.83
-54.99%
T
AT&T
25.72
9.64
59.95%
LUMN
Lumen Technologies
4.98
3.40
215.19%
USM
United States Cellular
64.71
29.06
81.51%
VZ
Verizon
42.59
5.34
14.34%
TMUS
T Mobile US
255.61
95.02
59.17%
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.