Morningstar Rating

Stock Research and Analysis

by Allan C. Nichols, CFA

Bulls Say

SK Telecom dominates the Korean wireless telecom market with more than 50% market share.
SK Telecom is generating growth from multiple areas, particularly B2B services.
The firm was the first operator in the country to offer LTE services and now LTE Advanced, providing it with a first-mover advantage in this next-generation technology. Read more 

Bears Say

SK Telecom has blown millions making poor investments outside of Korea, particularly in the U.S. Despite SK Hynix's recent improvement, we think its $3.1 billion acquisition of this unrelated business will end poorly.
To appease the Korean government, SK reduced its monthly telecom fees by KRW 1,000 per month in 2011 and provided 50 free text messages per month. Further government intervention is still possible.
The firm's quarterly financial releases don't provide a lot of commentary, particularly on its fixed-line telecom business, which makes following its progress difficult. Read more 

Management

SK Group owns 29.2% of SK Telecom's stock and has the right to name three directors to the board, including the CEO, giving it significant influence. SK Telecom's board also includes five independent directors. While we are pleased to see more independent   Read more 

Profile

SK Telecom is the largest wireless telecom operator in Korea, with 27.4 million subscribers. The firm also owns 55% of SK Broadband (formerly Hanaro Telecom), which has   Read more 

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