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Chorus Limited
Communication Services · Telecom Services
Updated 19 hours ago
$7.82
MARKET CAP
$3.40B
P/E RATIO
1111.1
DIV. YIELD
7.5%
FRANKING
—
Chorus Limited, together with its subsidiaries, engages in the provision of fixed line communications infrastructure services in New Zealand. It offers wholesale broadband, data, and voice services.
View full descriptionThe Warsi Rating combines two proven approaches: value investing principles and dividend strategy. A stock must score 70+ on both to be rated Solid or higher.
$3.09
Discounted cash flow estimate
$5.23
For 6% dividend yield
Business quality and balance-sheet durability.
Real cash left after running the business
Positive cash generation. Company produces real cash after capital expenditures - can fund dividends, buybacks, or growth.
Current Snapshot
Current FCF
$162M
Pass Rule
> $0
Status
Positive
Why It Matters
Free cash flow is the cash available after core operating and capital needs. It is central to dividend capacity.
Formula
Operating Cash Flow - Capital ExpendituresMethod
Review whether free cash flow is consistently positive and whether it is sufficient relative to dividends and debt needs.
Worked Example
This company generated $162M in free cash flow — cash left after operating costs and capital expenditure. Positive FCF means dividends are funded by real cash generation.
How to Interpret
Sources
Annual dividends as percentage of stock price
Chorus Limited, together with its subsidiaries, engages in the provision of fixed line communications infrastructure services in New Zealand. It offers wholesale broadband, data, and voice services. The company also builds and maintains a network of fiber and copper cables, ducts, poles, network electronics, and cabinets. In addition, it provides value-added network services; physical storage and site-sharing rental services for co-location of third party or shared asset; and installation, wiring, and consultation services.
Chorus Limited was incorporated in 2011 and is based in Wellington, New Zealand.
Who owns the company's shares and how much leadership has at stake
Management's wealth moves with yours
Professional fund managers have done their homework and chosen to own this
Shares freely traded on the ASX by individual investors like you
A healthy mix — insiders hold 6.4% (they have skin in the game) and professional fund managers hold 36.1% (they’ve done their homework and like the business). This balance is a good sign for long-term investors.
Current Snapshot
Insider %
6.4%
Institutional %
36.1%
Float %
57.5%
Why It Matters
Ownership mix affects governance incentives, liquidity, and share-price behaviour under large portfolio rebalancing flows.
Formula
Public Float (%) = 100 - Insider Ownership (%) - Institutional Ownership (%)Method
Use reported ownership percentages, convert to percentage terms, and compute remaining public float as the residual.
Worked Example
If insiders own 6.4% and institutions own 36.1%, public float is 57.5%.
How to Interpret
Higher insider ownership can improve alignment of incentives, while dominant institutional concentration can amplify short-term price moves.
A healthy mix — insiders hold 6.4% (they have skin in the game) and professional fund managers hold 36.1% (they’ve done their homework and like the business). This balance is a good sign for long-term investors.
Sources
Market data sourced from third-party financial data providers. Analysis generated using Warsi Criteria — proprietary scoring algorithms for value investing and dividend income analysis. Not financial advice. Learn how we analyse stocks →
Persistently negative free cash flow can force reliance on borrowing or equity issuance to maintain payouts.
Positive cash flow means dividends are funded by actual money, not accounting profits. As Buffett says, "Cash is fact, profit is opinion." Your income is backed by real cash generation.
Profit generated per $1 of shareholder investment
5.5% average is below the 12% threshold. This suggests the business may lack a durable competitive advantage.
Current Snapshot
10Y Avg
5.5%
Threshold
12.0%
Worst Year
-1.1%
Why It Matters
ROE shows how effectively management turns shareholder capital into profit. High and stable ROE can signal pricing power, cost discipline, or both.
Formula
Net Income / Shareholders' Equity x 100Method
Use the 10-year average ROE and review the weakest year to check whether returns stayed resilient across cycles.
Worked Example
This company's 10-year average ROE is 5.5%, meaning each $1 of shareholder equity generates $0.06 in annual profit. The threshold is 12%, and the worst single year was -1.1%.
How to Interpret
Higher and steadier ROE generally supports stronger long-term compounding. Large drawdowns in weak years can point to fragility.
Lower ROE means your investment compounds more slowly. At 5.5%, this business needs more capital to generate the same returns as competitors. Consider whether other strengths (yield, stability) compensate for weaker profitability.
Sources
How much the company owes vs. what it owns
Debt-to-equity of 5.82 is 5.8x over Buffett's limit. High leverage increases risk during downturns.
Current Snapshot
Current D/E
5.82x
Industry Limit
1.00x
Headroom
-4.82x
Why It Matters
Debt-to-equity shows balance-sheet risk. Lower leverage usually means more flexibility when earnings soften.
Formula
Total Debt / Shareholders' EquityMethod
Compare current D/E against the industry threshold used in the scoring framework, then assess remaining headroom.
Worked Example
This company's D/E is 5.82, meaning it carries 582 cents of debt for every $1 of equity. The telecommunications limit is 1.00, leaving it 4.82 over the limit.
How to Interpret
Lower values generally imply lower refinancing pressure and lower dividend stress in downturns.
High debt means interest payments come before dividends. During recessions, heavily indebted companies often cut dividends first to preserve cash. This adds risk to your income stream.
Sources
Price versus estimated intrinsic value and required return thresholds.
What percentage of the stock price comes back as earnings each year
0.1% earnings yield is below the 7.0% threshold. You'd earn nearly as much from safer government bonds, which means the extra risk of owning shares isn't being compensated.
Current Snapshot
Current Yield
0.1%
Required Yield
7.0%
Spread
-6.9pp
Why It Matters
Earnings yield reframes valuation as return on price paid. It helps compare equity earnings power against lower-risk alternatives.
Formula
(Earnings per Share / Stock Price) x 100Method
Calculate current earnings yield, then compare it to the required yield for the stock's industry setting.
Worked Example
With EPS of $0.01 and a share price of $7.82, earnings yield is 0.1%. The required yield for this industry is 7.0% (based on 4.5% government bond rate plus a risk premium).
How to Interpret
A yield above the required level suggests better valuation support; below it indicates thinner compensation for equity risk.
Returns don't justify the added risk compared to safe bonds. Consider whether the dividend yield alone compensates, or wait for a better price.
Sources
How current price compares with estimated intrinsic value
How much earnings are consumed by capital expenditure
CapEx consumes 1000% of cumulative earnings — above the 75% threshold. Expected for this capital-intensive sector.
Current Snapshot
10Y CapEx Intensity
1000%
Threshold
75%
Buffer
-925%
Why It Matters
CapEx intensity estimates how much of earnings must be reinvested just to sustain operations.
Formula
Cumulative CapEx (10yr) / Cumulative Net Income (10yr) x 100Method
Aggregate 10-year CapEx and net income, then compare the ratio with the sector threshold in the framework.
Worked Example
Over 10 years, 1000% of this company's cumulative earnings were consumed by capital expenditure. The telecommunications threshold is 75%, leaving a buffer of -925% (over threshold).
How to Interpret
Lower ratios usually indicate better cash conversion. Higher ratios can reduce room for dividends and buybacks.
High capital intensity means most earnings go back into maintaining the business rather than rewarding shareholders. This is typical for this sector but limits dividend growth potential.
Sources
Percentage of revenue that becomes profit after all expenses
How efficiently the company turns money into profit
Consistency of profits over time
Years of earnings needed to retire all long-term debt
Is the business growing — and is debt being managed responsibly?
Debt growing with stable revenue — check whether new borrowing is productive or a warning sign for dividend sustainability.
Current Snapshot
Revenue Change
-0.6%
Debt Change
+106.5%
Trend State
Mixed
Why It Matters
Revenue trend shows whether the business is expanding or contracting. Debt trend adds context on whether growth is being funded conservatively.
Formula
Revenue Change (%) = (Latest Revenue - Earliest Revenue) / |Earliest Revenue| x 100; Debt Change (%) = (Latest Debt - Earliest Debt) / |Earliest Debt| x 100Method
Map annual revenue history and, where relevant, annual debt history. For financial companies, debt is excluded because deposits and reserves distort this signal.
Worked Example
Revenue changed by -0.6% across the displayed period, while debt changed by +106.5%.
How to Interpret
Rising revenue with stable or falling debt is typically stronger than rising revenue funded by rapidly rising leverage.
Debt growing with stable revenue — check whether new borrowing is productive or a warning sign for dividend sustainability.
Sources
4.01% yield is well below the 6% target. Not suitable for Barsi's income strategy.
Current Snapshot
6Y Avg Yield
4.0%
6% Requirement
6.0%
Gross Yield
N/A
Why It Matters
Yield translates dividend income into a percentage of the price paid, which is central to income-first screening.
Formula
Annual Dividends per Share / Stock Price x 100Method
Use the 6-year average annual dividend for consistency and compare the result with the 6% framework requirement.
Worked Example
With a 6-year average annual dividend of $0.31 and a share price of $7.82, the Barsi yield is 4.0%. The minimum requirement is 6%.
How to Interpret
Higher sustainable yield improves upfront income, but unusually high yields may reflect elevated risk or weak coverage.
Low yield means you need significant capital to generate meaningful income. Barsi's strategy focuses on stocks that provide substantial cash flow from day one.
Sources
Track record of consistent dividend payments
| Ex-Date | Pay Date | Gross | Franking | Net | Credit |
|---|---|---|---|---|---|
| 16 Mar 2026Interim | 14 Apr 2026 | $0.17 | 0% | $0.17 | $0.00 |
| ~15 Sept 2026Est | ~7 Oct 2026 | ~$0.18 | 0% | ~$0.18 | $0.00 |
| Ex-Date | Pay Date | Gross | Franking | Net | Credit |
|---|---|---|---|---|---|
| 15 Sept 2025Final | 7 Oct 2025 | $0.26 | 0% | $0.26 | $0.00 |
| 17 Mar 2025Interim | 21 Apr 2025 | $0.21 | 0% | $0.21 | $0.00 |
| 16 Sept 2024Final | 21 Oct 2024 | $0.22 | 0% | $0.22 | $0.00 |
| 18 Mar 2024Interim | 16 Apr 2024 | $0.15 | 0% | $0.15 | $0.00 |
| 11 Sept 2023Final | 10 Oct 2023 | $0.20 | 0% | $0.20 | $0.00 |
| 13 Mar 2023Interim | 11 Apr 2023 | $0.13 | 0% | $0.13 | $0.00 |
| 12 Sept 2022Final | 11 Oct 2022 | $0.16 | 0% | $0.16 | $0.00 |
| 14 Mar 2022Interim | 12 Apr 2022 | $0.13 | 0% | $0.13 | $0.00 |
| 13 Sept 2021Final | 12 Oct 2021 | $0.14 | 0% | $0.14 | $0.00 |
| 15 Mar 2021Interim | 13 Apr 2021 | $0.10 | 0% | $0.10 | $0.00 |
Excellent track record. 11 years of consistent dividends through multiple market cycles.
Current Snapshot
History
11yr
Predictability
Variable
Payout Health
One-off event
Why It Matters
Payment consistency is a direct test of dividend reliability. Large cuts or skips often appear before confidence recovers.
Formula
Consecutive Years = count of years with dividend payments and no disqualifying skip/cut eventsMethod
Require at least 6 years of history, then check for skipped years and large cuts, allowing approved systemic-event exceptions.
Worked Example
This company has 11 years of dividend history (2016–2026). No suspensions detected — 11 consecutive years of payments. Predictability: Variable. Payout health: One-off event. The minimum requirement is 6 years.
How to Interpret
Longer uninterrupted records generally signal stronger income reliability than high yield alone.
A 11-year track record through multiple economic cycles gives confidence your income will continue. This company has proven it prioritises shareholder returns.
Sources
Highest price to lock in 6% yield
Current price ($7.82) is 50% above the ceiling. Wait for a drop to lock in 6% yield.
Current Snapshot
Current Price
$7.82
Max Buy Price
$5.23
Delta
-49.5%
Why It Matters
The price ceiling links valuation discipline to income targets by defining the price that aligns with a 6% yield target.
Formula
6-Year Average Annual Dividend / 0.06Method
Use the 6-year average dividend (not one year) and divide by 0.06 to estimate the maximum entry price for target yield.
Worked Example
With a current price of $7.82 and a ceiling of $5.23, the entry is 49.5% above the ceiling.
How to Interpret
Prices below the ceiling imply a historical yield above 6%; prices above it imply a lower historical yield at entry.
At this price, you won't achieve Barsi's target 6% yield. Consider waiting for a pullback — market volatility often creates more favourable valuations for patient investors.
Sources
Industry category of the business
Telecom is an essential service sector with stable, predictable cash flows - ideal for dividend investing.
Current Snapshot
Industry
Telecom Services
BESST Match
Yes
Score Impact
+3 points
Why It Matters
Sector classification helps contextualise risk and demand durability, which can materially affect dividend stability.
Formula
BESST Match = Sector in {Banks, Energy, Sanitation, Insurance, Telecom}Method
Match company sector or industry against BESST categories. A match adds scoring support but does not replace core dividend checks.
Worked Example
This company operates in Telecom Services (Communication Services sector). It matches the Telecom category — an essential service sector with stable demand, earning a +3 point scoring advantage.
How to Interpret
BESST alignment is a positive context signal. Non-BESST stocks can still qualify with strong yield and dividend consistency.
Essential services maintain demand regardless of economic conditions - people always need electricity, banking, and telecommunications. Your income is protected by inelastic demand.
Sources
How much of a company's earnings are paid out as dividends
The company is paying out more in dividends than it earns (860%). This is unsustainable long-term and often signals a dividend cut ahead. An inflated payout also distorts the price ceiling calculation used in our analysis.
Current Snapshot
Latest Ratio
859.9%
Healthy Range
30%-75%
Zone
Unsustainable
Why It Matters
Payout ratio links dividends to earnings capacity and helps evaluate whether current distributions are likely to remain supportable.
Formula
Payout Ratio (%) = (Annual Dividend per Share / Earnings per Share) x 100Method
Calculate year-by-year payout ratios where EPS is positive, classify each year by sustainability zone, and compare with the current TTM ratio.
Worked Example
$0.48 dividend / $0.01 EPS equals 6424.3% payout ratio.
How to Interpret
Ratios in the middle range are usually more sustainable than very high ratios. Values above 100% indicate dividends exceeded earnings in that period.
The company is paying out more in dividends than it earns (860%). This is unsustainable long-term and often signals a dividend cut ahead. An inflated payout also distorts the price ceiling calculation used in our analysis.
Sources
Stock is trading 262% ABOVE the fair-value threshold (includes 30% margin of safety) and above the estimated intrinsic value.
Current Snapshot
Current Margin
-153.1%
Industry Threshold
30%
Status
153% Overvalued
Why It Matters
Margin of safety provides a valuation buffer against modelling uncertainty and adverse business outcomes.
Formula
(Estimated Intrinsic Value per Share - Current Price) / Estimated Intrinsic Value per Share x 100Method
Estimate intrinsic value using a two-stage DCF (10-year projection plus terminal value), then compare with current price.
Worked Example
For this stock now: intrinsic value is $3.09 per share, current price is $7.82, and margin of safety is -153.1%.
How to Interpret
Positive margin indicates price below modelled value; negative margin indicates price above modelled value. Compare against the industry's required buffer.
The market price is above both your required threshold and intrinsic value estimate. Under this methodology, there is no valuation buffer for estimate error or market volatility.
Sources
0.4% net margin is below the 10% threshold. May reflect this sector's structural characteristics.
Current Snapshot
Current Margin
0.4%
Threshold
10.0%
Relative Position
-9.6%
Why It Matters
Net income margin shows how much profit the business keeps from each dollar of revenue after all costs.
Formula
Net Income / Total Revenue x 100Method
Compare current margin with the industry-specific threshold to avoid cross-sector distortions.
Worked Example
This company's net income margin is 0.4% — it keeps 0 cents of every revenue dollar as profit after all expenses. The telecommunications threshold is 10%, putting it 9.6% below the requirement.
How to Interpret
Margins that are both strong and stable can indicate competitive strength; persistent weakness may limit reinvestment and payout capacity.
Lower margins in this sector are common, but they leave less cushion if costs rise or revenue drops. Monitor whether margins are stable over time — consistency matters more than the absolute level.
Sources
4.8% ROIC is below the 10.0% threshold. Company may not be earning enough to justify the money invested in it.
Current Snapshot
5Y Avg
4.8%
Threshold
10.0%
WACC Delta
-3.2pp
Why It Matters
ROIC measures capital efficiency. Businesses that repeatedly earn above their funding cost can compound value more effectively.
Formula
After-Tax Operating Profit / Invested Capital x 100Method
Use the 5-year average ROIC and compare it with industry WACC plus the required spread in this framework.
Worked Example
This company's 5-year average ROIC is 4.8%, with a cost of capital (WACC) of 8.0%. The -3.2pp gap below WACC suggests it may be destroying value on each dollar invested.
How to Interpret
A healthy spread above WACC suggests value creation; a narrow or negative spread points to weaker capital efficiency.
Returns below the cost of borrowing mean the business destroys value over time. This can erode the foundation that supports dividends — proceed with caution.
Sources
1 loss years detected (max 0 allowed). Unpredictable earnings make valuation difficult.
Current Snapshot
Positive Years
9/10
Allowed Losses
0
EPS CAGR
-33.0%
Why It Matters
Consistency in EPS helps distinguish resilient earnings power from one-off performance spikes.
Formula
Positive EPS Years / Available EPS YearsMethod
For 8+ years of data, apply industry-specific loss tolerance. For limited data, every available year must be positive.
Worked Example
This company reported positive earnings in 9 of the last 10 years, with 1 loss year. The allowed loss tolerance for this industry is 0 years. EPS growth rate (CAGR) is -33.0%.
How to Interpret
Fewer loss years and stronger EPS continuity generally improve confidence in future dividend and valuation assumptions.
Volatile earnings create dividend uncertainty. When profits disappear, dividends often follow. Forecasting your future income becomes difficult.
Sources
Would take 437.7 years of earnings to pay off long-term debt — above the 6-year threshold. Heavy debt relative to earnings.
Current Snapshot
Payoff Years
437.7yr
Target Years
6yr
Gap
-431.7yr
Why It Matters
Debt payoff years converts leverage into an intuitive time measure, making debt burden easier to compare across stocks.
Formula
Long-Term Debt / Average Net Income (3yr)Method
Use current long-term debt and the 3-year average net income to smooth one-off profit noise.
Worked Example
With $2.9B in long-term debt and $7M in average annual earnings (3yr), it would take 437.7 years of earnings to pay off all debt. The telecommunications threshold is 6 years.
How to Interpret
Lower values generally indicate stronger debt capacity. Very high values can constrain dividend resilience.
High debt relative to earnings means interest payments compete with dividends for available cash. If earnings dip, the dividend is at risk because debt must be serviced first.
Sources
TPG Telecom Limited
Telstra Group Limited
SEEK Limited
Spark New Zealand Limited
CAR Group Limited
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