How to Buy China Mobile Stock Now, Forecast and Dividend Guide
China Mobile operates in the telecom industry with great success, evident from the large market share its near to 1 billion users. China Mobile stock could thus be a good investment, because of its expansion and market share growth possibilities, especially in rural China areas.
So, should you invest in China Mobile shares? This guide will offer some answers, as well as provide an easy tutorial about how to trade China Mobile stock.
China Mobile Stock Overview
China Mobile provides telecommunication services in across China. It is one of the largest telecom operators in terms of customer base size. Indeed, the company has over 60% market share in the domestic phone market, going far beyond its competitors China Telecom and China Unicom. It has over 900 million mobile customers and 200 million wireline broadband customers.
China Mobile Ltd primary business activities are organized in two divisions, Voice Business and Data Business. The company also provides consulting services, mobile data solutions, technology support and electronic communications products. Moreover, China Mobile also offers services such as wireless music, mobile payment, mobile reading, mobile video, wallet, mobile TV, etc.
China Mobile Ltd was incorporated in September 1997. The company was listed on NYSE and HKEX in October 1997. China Mobile stock NYSE symbol is CHL, whereas China Mobile Hong Kong stock exchange ticker is 00941. China Mobile stock was included as a constituent stock of the Hang Seng Index in Hong Kong in January 1998. The state holds around 72.72% of the outstanding shares, whereas 27.28% of the outstanding shares are owned by public investors.
China Mobile Share History
Let’s now look at China Mobile stock history, through important events and price movements.
China Mobile Share Historical Price
Major events in China Mobile stock history are related to a stock split and the delisting from NYSE. The China Mobile stock split occurred in July 2000, at a ratio of 4 to 1. Each pre-split share was converted into four shares. Comparing the China Mobile stock value, a couple of days before and after the split, the stock price experienced an increase after the split.
As for the delisting from the New York Stock Exchange, it was due to an executive order signed by former US president Donald Trump. The order banned US investments in companies labelled as potential threats to national security. This announcement caused the stock to decline to a decade-low price of approximately HK$40, which increased the interest among institutional investors from China. Consequently, the China Mobile stock experienced a large transaction volume from the increased interest through the Shanghai-Hong Kong Stock Connect.
China Mobile Share Price Chart
China Mobile Ltd price chart shows how the stock value fluctuated since its IPO. Until the financial crisis in 2008, the stock experienced a significant price fluctuation with an overall bullish movement. After 2008 China Mobile stock price moved sideways for more than a decade.
The stock reached an all-time-low of HK$15 in January 2003, and an all-time-high of HK$137 in October 2007. After this ATH, the stock depreciated by 40% in a year, and started a sideways movement within a range of HK$65 to HK$100. In 2019, China Mobile stock broke below the support price of HK$65, starting a downward trend with a monthly price fluctuation of 10%.
Since 2019, CHL stock has taken a few hits because of trade tensions between the US and China, investment bans, limitations for operating in the US, increased competition... China's trade war with the US caused a drop of nearly 20% in the company’s shares price in the second quarter of 2019. Moreover, the obstruction to offer its services in the US market had a significant influence on the China Mobile stock price drop.
The stock took another hit with the delisting announcement by the NYSE, at the end of 2020. The second price hit occurred when the company's stock and other Chinese stocks were appointed for delisting from the NYSE in 2021.
China Mobile Stock Dividend Information
China Mobile dividend has been paid since 2002. The company pays a semiannual cash dividend, and the amount has recorded an overall growth throughout the dividend payment history. The first dividend pay in 2002 was HK$0.32 (Hong Kong Dollar) and in 2021, shareholders received a semiannual dividend of HK$1.63 per share. The China Mobile stock dividend in 2020 was HK$3.29.
China Mobile stock has generated a dividend yield of 7.33% in 2020 with a trailing yield of approximately 7% during 2021. The company has increased its dividend yield from 3.75% in 2012 to more than 7% in less than a decade. Although the dividend yield records a significant overall growth, the growth varies from one year to the next.
The dividend payout ratio is an essential feature of a company's dividend, and in general, an adequate ratio is considered to be anywhere between 30% to 50%. China Mobile stock has maintained its dividend payout ratio within the suggested value for most of the last decade. The payout ratio moved above 50% during 2019, 2020 and 2021.
China Mobile Stock Forecast and Prediction
There is a bullish sentiment for future movements in China Mobile stock among market participants following the stock trends. China mobile stock analysis shows that the value of this company has an upward potential based on movements in fundamental indicators.
The company profit margin levels indicate that it has a good command over its expenditures. China Mobile also offers a solid ROE of above 9%, with the highest recorded value at over 20%. Some analysts point out that China Mobile stock may be undervalued, when considering the financial health of the company and the strong profitability levels. The company shares receive a buy rank based on Zacks methodology as a result of its financial performance.
CHL stock forecast suggests its price might reach a level of nearly HK$85, with the low price anticipated to be around HK$58. The targeted median for China Mobile stock is of around HK$72. Plotting technical indicators on price charts provide a buy signal based on the past movement in China Mobile stock price. Different types of indicators like moving averages, momentum, volume or trend indicators also point toward possible appreciation in stock price.
Why Invest in China Mobile Share? Points to Consider
Multiple reasons go in favour of investing in China Mobile stock today, such as:
- The company stock may be trading below the estimated fair value
- It is anticipated that company earnings might grow by nearly 7%
- Experts expect a positive impact on profitability from the launch of the 5G network
- It has an attractive dividend yield
- A stable and loyal customer base with more than 900 million users
- The low internet penetration in China means that the company may further increase the number of customers for rural areas in need of internet-related services
- There is potential for a relisting of CHL stock on NYSE under Biden administration
- Low level of volatility compared to other stocks
Where Can I Invest in China Mobile Stock Now?
Traders can invest in China Mobile stock through online brokers, such as ZFX. Traders can invest in China Mobile stock and many other promising shares though this broker. With ZFX, traders enjoy many benefits.
Reasons that make ZFX an optimal broker to buy China Mobile stock are:
- ZFX offers the MT4 platform, which is easy for use and extremely popular
- It offers a free demo account to practice and gain insights into the trading process
- Traders can choose to open several types of accounts, depending on their treading needs
- The minimum deposit can be as low as $50
- Fees are competitive
- It offers leverage, so traders can make higher profits with the same level of capital
- ZFX offers many to educational resources, an economic calendar and more useful tools.
How Can I Buy China Mobile Stock Now?
Buying China Mobile stock is relatively easy once you go through the process of opening and verifying an account with ZFX. Let’s see how to proceed.
1. Register with ZFX
To register an account with ZFX, you need to visit their website and select the desired option. You'll find the available options in the following image.
Traders may also start by registering for a demo trading account and test run their trading strategy. Newbie traders can access a demo account to gain trading experience. After selecting the desired option, the next window appears.
Provide the information as requested and proceed to the next steps.
2. Make your first deposit
To deposit funds, go to the top right corner of the ZFX website and select "myZFX” to log in. On your dashboard, select the "Deposit" option and proceed with the funding process, via Bank Transfer or Credit Cards.
3. Account verification
To comply with the relevant regulatory framework, ZFX will ask you to verify your account by providing a valid document. Acceptable documents for verification are a passport, driver's license or national ID. Moreover, traders also need to verify their bank account, and ZFX will ask them to provide a copy of their bank statement or a page in their bank book.
4. Buy CHL Stock
Before you buy CHL shares, you need to download the ZFX MT4 trading platform on your desired device. After downloading the ZFX MT4 platform, you can now log in with your personal information.
Go to the account section on the left and enter your user ID and password. You can then select China Mobile stock from the available assets listed under "Market Watch". You will then see a graph with the see the buy and sell prices, and this is where you open your trading position.
Bottom Line: Should I Buy China Mobile Stock Now?
China Mobile is one of the largest telecommunications companies worldwide, and it has relatively stable revenue level. This revenue might even record a rise in the future, thanks to the capturing of a larger market share and the development of 5G network.
CHL stock is a buy because of this, and also because of the firm’s solid financial health, positive forecasts and good dividend yield. If you wish to invest in China Mobile stock today, ZFX is one of the best brokers to do so, thanks to its high regulation and many other benefits.