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Spark New Zealand Ltd (SPKKY) is one of only three big integrated telecommunications groups in New Zealand. It is the dominant provider of fixed-line services in the country and is effectively an equal-number-one player in the mobile telephone market.

It also has a commanding presence in New Zealand corporate and wholesale telecommunications services. Spark's operations are split into mobile, voice, broadband, and digital-related services.

The company was formerly known as Telecom Corporation of New Zealand Limited and changed its name to Spark New Zealand Limited in August 2014.

The company was incorporated in 1987 and is headquartered in Auckland, New Zealand.

Three key data points gauge Spark or any dividend-paying firm.

The key three are:

(1) Price

(2) Dividends

(3) Returns

Those three basic keys best tell whether any company has made, is making, and will make money.

SPKKY Price

Over the past year, Spark’s share price fell 1.0% from $15.25 to $15.09 as of Wednesday’s market close.

If SPKKY stock trades in the range of $14.00 to $18.00 this next year, its recent $15.09 share price might rise to $16.30 by next year. Of course, Spark’s price could drop about the same $1.21 estimated amount or more.

My upside estimate of $1.21, however, is a few cents less than the average annual price gain by SPKKY over the past three and one-half years.

SPKKY Dividend

Spark New Zealand Limited has paid variable semi-annual dividends since March 31, 2000.  Spark’s most recent  SA dividend, of $0.47 was paid October q6. A February dividend has not yet been declared. The forward-looking SPKKY $0.97 annual dividend yield would be 6.43%

SPKKY Returns

Putting it all together, we add the estimated forward-looking dividend of  $0.97 to my estimated price upside of $1.21 and find a $2.18 gross gain.

At Wednesday’s $15.09 closing price, a little over $1000 would buy 66 shares.

A $10 broker fee (if charged), paid half at purchase and half at sale, might cost us about $0.15 per share.

Subtracting that likely $0.15 brokerage cost from the $2.18 estimated gross gain per share makes a net gain of $2.03 X 66 shares = $133.98 or about a 13.4% net gain.

You might choose to pounce on Spark New Zealand Ltd shares. Spark is an established telecommunications company. Furthermore, the estimated $64.30 dividend income from $1k invested is about 4.25 times greater than the price of a single share.

The question of what will happen to Spark’s price and dividend is yet to be answered.

Remember the true value of any stock is best realized through personal ownership of shares.

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