M2 Telecommunications have soared since I first mentioned them in this post in July Getting Down From My Pulpit. It’s a shame I didn’t get down from my pulpit, analyse and buy M2 sooner than September M2 Telecommunications Analysis and Valuation.
I shan’t complain. I own an attractive well managed company with recurring revenues which still appears undervalued. Pipe Network’s buyout has buoyed the sector and propelled M2 to new highs. Those taking a closer look at the telecommunications sector should see the value in M2. Speaking of Pipe, I was mentioned in …

Intersuisse highlighted M2 Telecommunications Group (MTU) as one of their preferred stocks in their list of stocks under $1bn with estimated current year P/E under 14.0 times and expected yield over 5%.
ROE – 26.7%
Forward Dividend Yield – 6.7%
Fwrd P/E – 10.1
Lance Spicer also reportedly tipped MTU is his newsletter yesterday.
MTU jumped 7.7% Wednesday to $1.54 on high volume of 404,514.
Disclosure: Long MTU

After my intial analysis of the three growth Telcos I decided to dig deeper into M2 Telecommunications and am now a part owner.
From the Horses Mouth: The MD Vaughan Bowen kindly replied to my email about his share sales and difference between NPAT and EPS FY10 forecasts. I’ll publish his reply, despite the second point being a tad embarrassing for me.

Today I’m going to do a first pass on three growth Telcos; M2 Telecommunications Group Limited (ASX:MTU), Pipe Networks Limited (ASX:PWK) and iiNet Limited (ASX:IIN). Two of them rank in the top ten Austalian Telcos the third’s growth could put in that group within a couple years.

Why these three?
- Hunter Hall disclosed a large position in MTU back in April, topped up in May and again in June taking their holding to 12.3%.
- A telco lawyer friend mentioned Pipe Networks to me when the price was around $1.80, I hoping it’s better late than never.
- iiNet is my ISP so I’ll call this a Lynchian idea.