Motley fool

M2 Group Ltd
M2 has been one of the best performing telecommunication stocks over the past 10 years and has delivered, on average, 46.3% each year over the last 10 years to investors.
M2 once again delivered another strong profit result recently, with underlying earnings per share increasing by 16% and it also rewarded shareholders with a 23% increase in the dividend for FY15.
The most impressive aspect of this result was that the majority of earnings growth resulted from organic growth. Its only acquisition for the year was the New Zealand-based CallPlus, which only contributed one month’s worth of earnings. M2 Group achieved especially strong growth in fixed voice and broadband services and these segments are expected to continue to grow at high double digit rates in the short to medium term.
Importantly for investors, the positive earnings momentum is forecast to continue in FY16, with management guiding for revenue growth of around 25% and NPAT growth of between 30%-35%.
With the share price falling nearly 25% from its yearly highs, M2 Group now appears to be attractively valued. Based on FY16 estimates, the shares are trading on a forward price-to-earnings ratio of around 13 and investors can expect to receive a fully franked dividend yield of more than 4%.