The Zacks Analyst Blog Highlights: China Unicom, Research In Motion, Apple, China Mobile and China Telecom - Press Releases
27 February 2012 - 7:30PM
Zacks
For Immediate Release
Chicago, IL – February 27, 2012 – Zacks.com announces the list
of stocks featured in the Analyst Blog. Every day the Zacks Equity
Research analysts discuss the latest news and events impacting
stocks and the financial markets. Stocks recently featured in the
blog include China Unicom (CHU),
Research In Motion Limited (RIMM), Apple
Inc. (AAPL), China Mobile (CHL) and
China Telecom Corp. (CHA).
Get the most recent insight from Zacks Equity Research with the
free Profit from the Pros newsletter:
http://at.zacks.com/?id=5513
Here are highlights from Friday’s Analyst
Blog:
China Unicom Adds 3G
Users
China's second largest mobile operator China
Unicom (CHU) added 3.232 million subscribers in January,
up 1.62% from the prior month. This takes the company’s total
customer base to 202.89 million.
The company’s GSM subscriber base rose to 159.823 million with
the net addition of 0.182 million customers, while its 3G
subscriber base increased to 43.069 million with net addition of
3.05 million in January. China Unicom added less 3G subscribers in
November compared to 3.48 million last month.
The company’s 3G business is performing well and the momentum is
expected to continue well into the future. 3G remains a compelling
opportunity and represents the single biggest driver of the
company’s long-term growth.
We believe China Unicom will continue to make significant
progress in expanding economies of scale in 3G, broadband and other
businesses that will likely improve its overall revenue and
profitability. The company is offering 3G services in collaboration
with Research In Motion Limited’s (RIMM)
BlackBerry phones. Additionally, the company has the exclusive
right to distribute Apple Inc.’s (AAPL) iPhone in
China.
China Unicom’s 3G and fixed-line broadband businesses have been
ramping up since last year. However, these businesses are expected
to remain under pressure due to increasing depreciation and
amortization expenses; network, operation and support expenses; as
well as selling expenses for the remainder of this year. We believe
these expenses will have an adverse effect on the company’s future
profitability, free cash flow and margins.
Further, higher handset subsidies and increased costs related to
3G service deployments will continue to be headwinds for the
company. Despite these challenges, we expect China Unicom to
benefit from new users this year.
China Unicom is offering handsets at subsidized rates with lower
3G service plans for multi-year contracts to retain existing
customers and add new ones. This will weigh on the company’s future
overall average revenue per user. Moreover, China Unicom remains
significantly challenged by aggressive nationwide 3G service
rollouts by its peers China Mobile (CHL) and
China Telecom Corp. (CHA).
We currently have a long-term Neutral rating on China Unicom.
The stock retains a Zacks #3 (Hold) Rank for the short term (1–3
months).
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APPLE INC (AAPL): Free Stock Analysis Report
CHINA TELCM-ADR (CHA): Free Stock Analysis Report
CHINA MOBLE-ADR (CHL): Free Stock Analysis Report
CHINA UNICOM (CHU): Free Stock Analysis Report
RESEARCH IN MOT (RIMM): Free Stock Analysis Report
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