Key developments

Telco stocks in Australia and New Zealand have seen wide spreads in performance over the last 12 months. Economic growth is expected to remain sluggish relative to previous years, creating uncertain performance for telco equities.

Superloop

Superloop’s share price has continued its gains, up around 14% in June, after the company released a trading update which entailed the confirmation of its white label agreement with Origin going live on 2 July 2024 to around 130-150k broadband customers. The release also included a consumer trading update with 45,720 net new customers in H2 FY24. Additionally, the company provided updated FY24 EBITDA guidance which is expected to be at the top end of the $51-53 million range.

Megaport

Megaport’s shares fell over 17% in June, with the stock facing a correction, down 27% since its highs of mid May despite no price sensitive ASX announcements since then. The stock has displayed volatility in recent years and currently trades at a P/E multiple of 200.

Swoop

In the last month Swoop’s stock fell around 8% with investors reacting unfavourably to recent M&A announcements by the company, including that it is divesting its wholesale voice business to Pivotel for $9 million in cash. Pivotel is an Australian satellite phones and internet business for rural and remote environments. Also during June, Swoop announced that it is acquiring residential Fibre infrastructure in regional Western Australia. The infrastructure is connected to approximately 900 existing homes and is expected to deliver $1.2 million in revenue over the next 3 years.

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