M1 and Starhub are household names with close to 50% of Singaporeans being their customers.
- M1 9-mth 2017 EBITDA margin: 29.8%; 2016 is 32.1%
- Starhub 9-mth 2017 EBITDA margin: 29.5%; 2016 is 31.5%
Ideally, dividends paid should be lower than Earnings per Share (EPS) and Free Cash Flow (FCF), as anything above, over a sustained period, means company would need to borrow, or dip into their cash reserves, to sustain dividend payment.
Starhub's dividend is higher than both EPS and FCF per share in 2016. Its FCF has also shown a down trend past 3 years.
Do note that both companies have actually reduced their dividends. Starhub has announced intention to pay out $0.04 per quarter instead of the usual $0.05, decreasing its div per share to $0.16. M1 has also been reducing its dividends for the past 3 years: