Global Index Briefing: EMU Telecom Services Sector MSCI May 9, 218 Dr. Ed Yardeni 516-972-7683 eyardeni@ Joe Abbott 732-497-536 jabbott@ Please visit our sites at www. blog. thinking outside the box
Table Of Contents Table Of Contents EMU Telecom Services Sector MSCI Stock Price Index 1 Earnings 2 Revenues & Margins 3 Valuation 4 May 9, 218 / Global Index Briefing: EMU Telecom Services Sector MSCI www.
4 3 Figure 1. Stock Price Index EMU TELECOMMUNICATION SERVICES SECTOR MSCI INDEX (euros, ratio scale) 4 3 2 2 175 175 5/9 1995 1996 1997 1998 1999 2 21 22 23 24 25 26 27 28 29 2 211 212 213 214 215 216 217 218 219 2-day moving average. Source: MSCI. 1 1 Figure 2. EMU TELECOMMUNICATION SERVICES SECTOR MSCI, FORWARD EARNINGS, & VALUATION EMU Telecommunication Services Sector MSCI Index 5/9/18 Blue Angels Implied Price Index* 5/3/18 1 1 75 x16 75 x12 27 28 29 2 211 212 213 214 215 216 217 218 219 x8 * Implied price index calculated using forward earnings times forward P/Es. Monthly through December 25, weekly thereafter. Source: MSCI and Thomson Reuters I/B/E/S. Page 1 / May 9, 218 / Global Index Briefing: EMU Telecom Services Sector MSCI www.
8 6 Figure 3. Earnings EMU TELECOMMUNICATION SERVICES SECTOR MSCI EARNINGS PER SHARE (analysts average forecasts, ratio scale) 8 6 4 17 18 19 4 2 2 Consensus Forecasts Annual estimates Forward earnings* 1995 1996 1997 1998 1999 2 21 22 23 24 25 26 27 28 29 2 211 212 213 214 215 216 217 218 219 * Time-weighted average of consensus estimates for current year and next year. Monthly through December 25, then weekly. 2 Figure 4. EMU TELECOMMUNICATION SERVICES SECTOR MSCI NET EARNINGS REVISIONS* 2 15 15 5 5-5 Apr -5 - -15-2 NERI Feb -6 Mar -1.26 Apr -5.95 1995 1996 1997 1998 1999 2 21 22 23 24 25 26 27 28 29 2 211 212 213 214 215 216 217 218 219 - -15-2 * Three-month moving average of the number of forward earnings estimates up less number of estimates down, expressed as a percentage of the total number of forward earnings estimates. Page 2 / May 9, 218 / Global Index Briefing: EMU Telecom Services Sector MSCI www.
75 Figure 5. Revenues & Margins EMU TELECOMMUNICATION SERVICES SECTOR MSCI REVENUES PER SHARE (analysts average forecasts, ratio scale) 75 7 7 65 65 6 55 Consensus Forecasts Annual estimates Forward revenues* 17 18 19 6 55 24 25 26 27 28 29 2 211 212 213 214 215 216 217 218 219 * Time-weighted average of consensus estimates for current year and next year. Monthly through December 25, then weekly. 12 Figure 6. EMU TELECOMMUNICATION SERVICES SECTOR MSCI PROFIT MARGIN (using analysts average earnings and revenues forecasts) 12 8 19 8 17 18 6 Consensus Forecasts Annual estimates Forward profit margin* (7.4) 6 4 24 25 26 27 28 29 2 211 212 213 214 215 216 217 218 219 4 * Time-weighted average of the consensus estimates for current year and next year. Monthly through December 25, weekly thereafter. Page 3 / May 9, 218 / Global Index Briefing: EMU Telecom Services Sector MSCI www.
9 8 7 Valuation Figure 7. EMU TELECOMMUNICATION SERVICES SECTOR MSCI VALUATION MULTIPLE* Forward P/E (13) 9 8 7 6 6 4 4 3 3 2 2 1995 1996 1997 1998 1999 2 21 22 23 24 25 26 27 28 29 2 211 212 213 214 215 216 217 218 219 * Price divided by forward consensus expected earnings per share. Monthly data through December 25, weekly thereafter. 5. 4 4. Figure 8. EMU TELECOMMUNICATION SERVICES SECTOR MSCI RELATIVE VALUATION* Relative P/E capped at 4. 5. 4 4. 3 3 3. 3. 2 2 2. 1 Relative P/E (.91) 2. 1 1.. 1995 1996 1997 1998 1999 2 21 22 23 24 25 26 27 28 29 2 211 212 213 214 215 216 217 218 219 1.. * Forward P/E of index relative to All Country World MSCI forward P/E. Monthly data through December 25, weekly thereafter. Page 4 / May 9, 218 / Global Index Briefing: EMU Telecom Services Sector MSCI www.
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