Asia Value & Moat Stocks is a research service for value investors seeking Asia-listed stocks with a huge gap between price and intrinsic value, leaning towards deep value balance sheet bargains (i.e., buying assets at a discount e.g., net cash stocks, net-nets, low P/B stocks, sum-of-the-parts discounts) and wide moat stocks (i.e., buying earnings power at a discount in great companies like "Magic Formula" stocks, high-quality businesses, hidden champions and wide moat compounders). Sign up here to get sta ...

Key Takeaways Cboe Global Markets, AngloGold, SK Telecom and Sasol screen for low beta amid market volatility.Cboe benefits from strong options trading, rising fees and solid finances with low debt.AngloGold boosts earnings via cash flow, higher margins and disciplined capital allocation.Investor sentiment has been weighed down by concerns over risky private loans and rising oil prices stemming from escalating tensions between the United States and Iran, according to CNBC.Thus, the stock market will remain ...

Core Viewpoint - The article emphasizes the importance of value investing and highlights SK Telecom Co. (SKM) as a strong value stock based on its favorable valuation metrics and earnings outlook [2][4][7] Valuation Metrics - SK Telecom Co. has a P/E ratio of 11.1, which is lower than the industry average P/E of 12.16, indicating potential undervaluation [4] - The company's P/B ratio stands at 1.03, compared to the industry average P/B of 1.29, suggesting an attractive valuation [5] - SKM's P/S ratio is 0.94, significantly lower than the industry's average P/S of 1.57, reinforcing the notion of undervaluation [6] Earnings Outlook - The strong earnings outlook for SK Telecom Co. contributes to its classification as an impressive value stock, supported by its high Zacks Rank and Value grade [3][7]

Industry Overview - The Zacks Wireless Non-US industry is positioned to benefit from strong demand trends driven by the increasing need for connectivity in the digital age, despite facing challenges such as high capital expenditures, margin erosion, and supply chain disruptions [1][5] - The industry includes mobile telecommunications and broadband service providers that offer voice services, IoT solutions, content streaming, and various IT services [3] Growth Opportunities - Companies like América Móvil, TIM, and SK Telecom are expected to capitalize on long-term growth opportunities due to rising demand for scalable infrastructure and the proliferation of IoT and 5G deployment [2] - The industry is focusing on network optimization to meet the growing demand for coverage, speed, and quality, necessitating significant investments in advanced networking architecture [4] Challenges - The industry is currently facing challenges such as a shortage of chips, high raw material prices due to geopolitical conflicts, and increased competition from over-the-top service providers, which are impacting profitability [5] - Price-sensitive competition is expected to intensify, affecting customer retention and overall financial results [5] Strategic Focus - Industry players are taking steps to enhance subscriber growth and manage churn, including geographical expansion and strategic acquisitions [6] - Companies are adopting unlimited plans to improve average revenue per user and are focusing on increasing customer loyalty and handset connections [6] Market Performance - The Zacks Wireless Non-US industry has outperformed the broader Zacks Computer and Technology sector and the S&P 500, gaining 51.7% over the past year compared to 16.5% and 22.9% for the S&P 500 and sector, respectively [9] - The industry currently holds a Zacks Industry Rank of 81, placing it in the top 33% of over 250 Zacks industries, indicating positive near-term prospects [7][8] Valuation Metrics - The industry has a trailing 12-month EV/EBITDA ratio of 4.37X, significantly lower than the S&P 500's 18.88X and the sector's 19.01X, suggesting potential undervaluation [12] Notable Companies - **SK Telecom**: A leading telecommunications provider in South Korea, focusing on 5G and AI technologies, with a stock gain of 38.2% over the past year and a Zacks Rank of 1 (Strong Buy) [14] - **América Móvil**: The largest telecommunications provider in Latin America, with a stock gain of 47.1% and a Zacks Rank of 2 (Buy) [17] - **TIM**: A major communication service provider in Brazil, focusing on 5G rollout and achieving a stock gain of 76% over the past year, with a long-term earnings growth expectation of 18.7% [20]

Group 1 - The article does not provide any relevant content regarding the company or industry [1]

Financial Data and Key Metrics Changes - Consolidated revenue for fiscal year 2025 was KRW 17,099.2 billion, a decrease of 4.7% year-on-year due to subsidiary sales and a net decline in subscribers following a cybersecurity incident [4] - Operating income fell to KRW 1,073.2 billion, down 41.1% year-over-year, primarily due to revenue decline and costs related to the cybersecurity incident [6] - Net income decreased to KRW 375.1 billion, a 73% drop year-over-year, mainly due to penalty payments from the cybersecurity incident [6] - The company decided not to pay out a quarterly dividend for the fourth quarter due to the financial impact of the cybersecurity incident [6] Business Line Data and Key Metrics Changes - The MNO (Mobile Network Operator) business focused on addressing changes caused by the cybersecurity incident, with plans to restore customer trust and improve operational fundamentals [7] - AI business revenue continued a two-digit growth trend, supported by increased utilization rates of data centers and ongoing construction of new facilities [8] Market Data and Key Metrics Changes - The overall market for telecom services showed signs of stabilization after initial fluctuations due to competitor actions, with SK Telecom focusing on customer value innovation to regain market share [50] Company Strategy and Development Direction - The company aims to restore market leadership through customer value innovation, focusing on redesigning telecom business elements to offer real value [26] - Plans to innovate business productivity through AI acceleration, applying AI across various operational areas to enhance customer experience and productivity [27] - The company will enhance the sustainability of its AI business by focusing on core strengths and improving profitability through cost structure adjustments [28] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by the cybersecurity incident but expressed commitment to restoring earnings and returning to previous dividend payout levels [21] - The focus for 2026 will be on improving profitability and customer trust, with a strategic emphasis on customer value and operational optimization [60] Other Important Information - The company is working on restructuring product offerings and market operations to better align with customer preferences and improve cost efficiency [53] - SK Telecom is developing a hyperscale AI model, A.X K1, which is expected to create significant business opportunities in both B2C and B2B sectors [40][42] Q&A Session Summary Question: Dividend policy and earnings normalization for 2026 - Management indicated that restoring earnings is a priority for 2026, with efforts to return to previous dividend payout levels while considering measures to increase shareholder value [21][22] Question: Strategic directions for new management - The new management will focus on strengthening competitiveness in telecom and AI businesses, with three main strategic directions: customer value innovation, AI acceleration, and sustainability of the AI business [25][26][27] Question: Equity stake in Anthropic and potential liquidation - Management stated that no decisions have been made regarding the liquidation of the equity stake in Anthropic, and updates will be provided in the upcoming business report [36][37] Question: MNO business impact from competitor actions - The Head of MNO Support noted that while there was a temporary expansion in the carrier switching market, SK Telecom is focusing on restoring customer trust and expanding its customer base through value innovation [49][50]

Financial Data and Key Metrics Changes - Consolidated revenue for fiscal year 2025 was KRW 17,099.2 billion, a decrease of 4.7% year-on-year due to subsidiary sales and a net decline in subscribers following a cybersecurity incident [4] - Operating income fell to KRW 1,073.2 billion, down 41.1% year-over-year, attributed to revenue decline and costs related to the cybersecurity incident [5] - Net income decreased to KRW 375.1 billion, a 73% drop year-over-year, primarily due to penalty payments from the cybersecurity incident [5] - The company decided not to pay out a quarterly dividend for the fourth quarter due to the financial impact of the cybersecurity incident [5] Business Line Data and Key Metrics Changes - The MNO business focused on addressing changes caused by the cybersecurity incident, with plans to restore customer trust and improve operational fundamentals [6][7] - AI business revenue continued a two-digit growth trend, driven by increased utilization rates of data centers and the acquisition of a new data center [7] - The company aims to enhance efficiency and productivity in AI-related businesses to produce meaningful outcomes [8] Market Data and Key Metrics Changes - The overall market for MNO services saw temporary expansion due to competitors waiving cancellation fees, but SK Telecom experienced stabilization with a focus on restoring customer trust [47] - The company plans to minimize revenue impact by winning back subscribers and developing new customer segments in 2026 [51] Company Strategy and Development Direction - The company prioritizes restoring market leadership through customer value innovation and redesigning telecom business elements to offer real value [23] - Plans to innovate business productivity through AI acceleration, applying AI across various areas to improve customer experience and operational efficiency [24] - The company aims to enhance the sustainability of its AI business by focusing on core strengths and improving profitability through cost structure improvements [25] Management Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by the cybersecurity incident and emphasized the need to restore earnings and shareholder trust [18] - The focus for 2026 includes improving profitability in the telecom business and enhancing the self-sustainability of the AI business [13][15] - The company plans to utilize AI to boost productivity and improve profitability across its operations [15] Other Important Information - The board of directors set the DPS for fiscal year 2025 at KRW 1,661, pending approval at the annual general shareholders meeting [6] - The company is committed to turning the current crisis into an opportunity to restore customer trust and improve financial performance [8] Q&A Session Questions and Answers Question: Dividend policy for 2026 and earnings normalization - Management aims to restore earnings and return to previous dividend payout levels, considering measures to increase shareholder value [18][19] Question: Strategic directions for new management - The new management will focus on strengthening competitiveness in telecom and AI businesses, with priorities on customer value innovation and AI acceleration [22][23] Question: Equity stake in Anthropic and potential liquidation - Management cannot disclose specific details about the equity stake but will provide updates in the upcoming business report [33][34] Question: Strengths in proprietary foundational model project - The A.X K1 model is recognized for its high-quality responses and is expected to create business opportunities in both B2C and B2B sectors [38][39] Question: Impact of competitors' cancellation fee waivers on MNO business - The company experienced a temporary expansion in the carrier switching market but is focusing on restoring customer trust and improving core business competitiveness [47][48]

Financial Data and Key Metrics Changes - Consolidated revenue for fiscal year 2025 was KRW 17,099.2 billion, a decrease of 4.7% year-on-year, attributed to subsidiary sales, a net decline in subscribers due to a cybersecurity incident, and tariff discounts [3][4] - Operating income fell to KRW 1,073.2 billion, down 41.1% year-over-year, primarily due to revenue decline and costs related to the cybersecurity incident [4] - Net income decreased to KRW 375.1 billion, a 73% drop year-over-year, mainly due to penalty payments from the cybersecurity incident [4] Business Line Data and Key Metrics Changes - The MNO (Mobile Network Operator) business faced challenges due to the cybersecurity incident, leading to a decline in subscribers and revenue [5][6] - AI business revenue continued a two-digit growth trend, supported by increased utilization rates of data centers and the acquisition of a new data center [6] Market Data and Key Metrics Changes - The overall market for MNO services saw temporary expansion due to competitors waiving cancellation fees, but SK Telecom experienced stabilization with a focus on restoring customer trust [78][84] - The company plans to minimize revenue impact in 2026 by winning back subscribers and developing new customer segments [84] Company Strategy and Development Direction - The company aims to restore market leadership through customer value innovation, redesigning telecom business elements to offer real value [35][36] - AI will be integrated across all business areas to enhance productivity and customer experience, with a focus on improving profitability through economies of scale [37][38] - The company plans to enhance the sustainability of its AI business by focusing on core strengths and improving cost structures [39] Management Comments on Operating Environment and Future Outlook - Management acknowledged the ongoing impact of the cybersecurity incident on financial performance and emphasized efforts to restore customer trust and improve business fundamentals [3][8] - The priority for 2026 is to restore earnings and return to previous dividend payout levels, with considerations for shareholder value enhancement [25][26] Other Important Information - The company decided not to pay out a quarterly dividend for Q4 2025 due to financial impacts from the cybersecurity incident [4][5] - The board set the DPS for fiscal year 2025 at KRW 1,661, pending approval at the annual general shareholders meeting [5] Q&A Session Summary Question: Dividend policy for 2026 and earnings normalization - Management expressed a commitment to restore earnings and return to previous dividend levels, while acknowledging the challenges posed by the cybersecurity incident [18][25] Question: Strategic directions for new management - The focus will be on strengthening competitiveness in telecom and AI, with priorities on customer value innovation, AI productivity enhancement, and sustainability of the AI business [33][39] Question: Equity stake in Anthropic and future plans - Management stated that no decisions have been made regarding the liquidation of the equity stake in Anthropic, and updates will be provided in the upcoming business report [53][55] Question: MNO business impact from competitors - Management noted that while there was a temporary expansion in the carrier switching market, they are focusing on restoring customer trust and improving core business competitiveness [78][84]

SK telecom Investor Briefing Earnings for FY2025 2026.2.5. Disclaimer This presentation contains forward-looking statements with respect to the financial condition, results of operations, and business of SK Telecom (the "Company", or "SKT") and its subsidiaries, and plans and objectives of the management of the Company. The forward-looking statements are influenced by unknown risks, uncertainties, and other factors that may impact the actual performance and results of the Company. The Company does not make ...

Market Overview - The U.S. stock market is expected to remain volatile due to investor concerns regarding the leadership of the Federal Reserve and the potential for a government shutdown [1] Investment Opportunities - Low-beta stocks such as Futu Holdings Limited (FUTU), Forum Energy Technologies Inc (FET), Dollar General Corporation (DG), and SK Telecom (SKM) are highlighted as potential investment opportunities amid market volatility [1][8] Company Insights - **Futu Holdings**: This company offers fully digitalized financial services and has been experiencing rapid growth as clients invest more, indicating increased trust from both local and international investors [6] - **Forum Energy Technologies**: Positioned to benefit from rising global energy demand, FET focuses on reducing debt and making strategic investments to strengthen its balance sheet and support long-term growth [7][8] - **Dollar General**: Known for providing affordable everyday essentials, DG is expanding its store presence and is expected to grow steadily, creating long-term wealth for shareholders [9] - **SK Telecom**: A leading mobile service provider, SKM is integrating AI into its core business operations, focusing on digital transformation and AI services to enhance long-term shareholder value [10]