# Spark New Zealand (SPK.AU)

Canonical: https://gigainvestors.com/s/SPK.AU

Analysis as of: 2026-10-16T07:40:53.010Z. Financial observations: FY1997–FY2026.

Listing currency: AUD. Reporting currency: NZD.

## Verdict

Not a wonderful business

Quality tests for Buy: not passed (profit record: fail; earnings resilience is evidence only). Published buy qualification: no.

Share price: AUD 1.54 per share; close as of 2026-10-15.

Estimated value: low AUD 2.05 per share, central AUD 2.33 per share, high AUD 2.70 per share. Buy at or below the central value AUD 2.33 per share. Valuation as of 2026-10-16T07:40:53.010Z; scenarios are not confidence intervals.

Expected annual return: 13.9% at the stated quote. About 13.9% a year at today's price (required return 10.0%). required return 10.0% a year (10% floor; AU 10-year bond 5.2% + 4 points).

## Checklist

### understandable: fail

- 4 revenue declines in the last 10 years (informational)

- negative average operating margin

- operating margin variation exceeds 0.35

- Financial history: 10 years

- Years with declining revenue: 4

- Years with a net loss: 1

- Operating margin variation: 9.96×

Chart: Operating margin; fiscal year observations.

- FY2017: -2.04×

- FY2018: 0.15×

- FY2019: 0.19×

- FY2020: 0.19×

- FY2021: 0.16×

- FY2022: 0.16×

- FY2023: 0.16×

- FY2024: 0.15×

- FY2025: 0.10×

- FY2026: 0.11×

### moat: fail

- ROIC median below threshold

- ROIC worst years below threshold (more than 1 bad year allowed)

- ROIC, median of available years: 13.5%

- ROIC, second-lowest year: 7.3%

- Typical minus recent gross margin: 3.5 pp

- Typical gross margin (annual median): 52.1%

- Recent gross margin (lower of latest and 3-year median): 48.6%

- Years with nonpositive capital: 0

- Capital spending / revenue: 11.5%

- ROIC including acquisitions, ten-year median: 12.0%

Chart: ROIC excluding acquisitions; fiscal year observations.

- FY2017: -11.3%

- FY2018: 15.9%

- FY2019: 15.6%

- FY2020: 15.5%

- FY2021: 13.0%

- FY2022: 14.1%

- FY2023: 18.0%

- FY2024: 10.0%

- FY2025: 7.3%

- FY2026: 11.2%

### economics: fail

- working capital as a share of revenue rose more than 10pp and ends positive

- Owner earnings / net income, 5-yr: 0.86×

- Cash conversion uses consolidated totals: No

- Owner earnings, five-year total: NZD 2.3B

- Net income, five-year total: NZD 2.6B

- Return on incremental invested capital: >100%

- Working capital / revenue, annual change: 4.0 pp

- Working capital / revenue, change between three-year averages: 24.6 pp

- Working capital / revenue, final three-year average: 4.9%

Chart: Annual owner cash / profit; fiscal year observations.

- FY2022: 1.06×

- FY2023: 0.86×

- FY2024: 0.25×

- FY2025: 0.91×

- FY2026: 1.05×

### management: pass

- Historical market-dollar context (not the management verdict): 2016 to 2026 (10 years)

- buybacks unrelated to price (informational)

- ROIC first 3 years vs last 3 years: 15.6% vs 10.0%

- Per-share earnings: -0.00 to 0.17 (three-year endpoint medians)

- Management verdict uses per-share economic progress: Yes

- Ordinary dilution, 10-year annual growth: 0.2%

- Ordinary dilution, 5-year annual growth: 0.2%

- Market cap gain: NZD -3.9B

- Cumulative retained earnings: NZD 793M

- Diluted shares, 10-year annual growth: 0.2%

- Diluted shares, 5-year annual growth: 0.2%

- $1 test, starting fiscal year: FY2016

- $1 test, ending fiscal year: FY2026

- Per-share value change: NZD 0.17

- Per-share value, starting three-year median: NZD -0.00

- Per-share value, ending three-year median: NZD 0.17

- Buybacks concentrated in cheaper years (correlation): -1.00

- Average buyback yield: 1.6%

- Buyback history: 2 years

- Debt-funded buybacks: No

- Acquisition spending: NZD 66M

- Cumulative net income, 10 years: NZD 4.2B

- ROIC, first three-year median: 15.6%

- ROIC, last three-year median: 10.0%

Chart: Earnings per share; fiscal year observations.

- FY2017: NZD -0.00

- FY2018: NZD 0.21

- FY2019: NZD 0.22

- FY2020: NZD 0.23

- FY2021: NZD 0.21

- FY2022: NZD 0.22

- FY2023: NZD 0.61

- FY2024: NZD 0.17

- FY2025: NZD 0.14

- FY2026: NZD 0.26

### accounting: pass

- Sloan accruals: -12.5%

- Receivables to sales index (DSRI): 1.00×

- Restructuring years, last five: 0

- Stock compensation / operating cash flow: 0.0%

- Earnings backed by cash: Yes

- Operating cash / earnings: 2.08×

- Accounting red flags: 0

- Goodwill and intangibles / equity: 0.48×

Chart: Sloan accruals; fiscal year observations.

- FY2017: -5.3%

- FY2018: -12.7%

- FY2019: -8.8%

- FY2020: -11.0%

- FY2021: -11.5%

- FY2022: -12.4%

- FY2024: -9.7%

- FY2025: -9.3%

- FY2026: -12.5%

## Holders

## Price story

Down 69% since Dec 2022 · sales +0.4%

Story as of 2026-10-16T10:00:11.709Z; price observation 2026-10-15.

Price needs cash profits to shrink 4.4% a year for ten years

### Sales · FY2025–2026

sales +0.4%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2017: NZD 1.5M 

- FY2018: NZD 3.6B 

- FY2019: NZD 3.5B 

- FY2020: NZD 3.6B 

- FY2021: NZD 3.6B 

- FY2022: NZD 3.7B 

- FY2023: NZD 3.9B 

- FY2024: NZD 3.8B 

- FY2025: NZD 3.6B 

- FY2026: NZD 3.6B 

### Gross margin · FY2026

gross margin 48.6%; source https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/; observed 2026-10-16.

- FY2017: 12.4% 

- FY2018: 98.3% 

- FY2019: 98.3% 

- FY2020: 98.2% 

- FY2021: 53.0% 

- FY2022: 52.4% 

- FY2023: 51.8% 

- FY2024: 51.5% 

- FY2025: 50.1% 

- FY2026: 48.6% 

## Owner memo

Memo as of 2026-10-16T08:06:05.509Z.

### How it makes money

Annual sales are NZD 3.6 billion.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2026-06-30 (filed 2026-10-16T07:40:53.010Z); FY2026: revenue 3637000000; grossProfit 1769000000; margin = grossProfit / revenue.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); SPK.AU: Spark New Zealand Limited, together with its subsidiaries, operates as a telecommunications company in New Zealand. It operates through Cloud, IT Services Management, and Other Connectivity segments. The company offers telecommunications, information technology, and other digital products and services, including mobile services; broadband services; voice services; other connectivity; cloud services; IT services management; procurement and partner services; and business connectivity services. It also provides fixed modems and mobile handsets; installation or set-up services; network infrastructure; IT infrastructure build and maintenance services; distribution and supply chain services; and wholesale and outsourced telecommunications services. In addition, the company is involved in rental of equipment; data analytics business; finance activities; and insurance activities. It serves individuals, households, small businesses, governments, and large enterprises. The company was formerly known as Telecom Corporation of New Zealand Limited and changed its name to Spark New Zealand Limited in August 2014. Spark New Zealand Limited was incorporated in 1987 and is based in Auckland, New Zealand.

### Why customers stay

Margins ranged from 48.6% to 51.5% during 2024–26; it earns 13.5% on its capital.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2024-06-30 (filed 2026-10-16T07:40:53.010Z); FY2024: grossProfit / revenue = 51.5%.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2025-06-30 (filed 2026-10-16T07:40:53.010Z); FY2025: grossProfit / revenue = 50.1%.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2026-06-30 (filed 2026-10-16T07:40:53.010Z); FY2026: grossProfit / revenue = 48.6%.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:40:53.010Z); 10-year return on capital observations [[2017,-0.11273935928850168],[2018,0.15883940620782727],[2019,0.15626279721039718],[2020,0.15499098383040036],[2021,0.12971951679479996],[2022,0.14067170939396684],[2023,0.17950004446384685],[2024,0.09960252192982456],[2025,0.072723203044123],[2026,0.11171137486317897]]; median 0.13519561309438338. ROIC follows the displayed moat series; financial companies use return on tangible equity.

### Can it raise prices

Kept about a 52% gross margin through 2022 cost inflation.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:40:53.010Z); Gross margin observations: [[2021,0.5298737727910239],[2022,0.5238224147265836],[2023,0.5181935483870967]]; range within 2 percentage points.

### Where the cash goes

Paid dividends in 9 of 10 years.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2018-06-30 (filed 2026-10-16T07:40:53.010Z); FY2018: growth capex 0; upkeep 414000000; owner earnings 405000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2019-06-30 (filed 2026-10-16T07:40:53.010Z); FY2019: growth capex 0; upkeep 415000000; owner earnings 373000000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2020-06-30 (filed 2026-10-16T07:40:53.010Z); FY2020: growth capex 0; upkeep 393000000; owner earnings 398600000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2021-06-30 (filed 2026-10-16T07:40:53.010Z); FY2021: growth capex 0; upkeep 386000000; owner earnings 427800000. Growth capex / owner earnings = 0.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2022-06-30 (filed 2026-10-16T07:40:53.010Z); FY2022: growth capex 0; upkeep 425000000; cash acquisitions 7000000; owner earnings 436200000. Growth capex plus acquisitions / owner earnings = 0.016047684548372305.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2023-06-30 (filed 2026-10-16T07:40:53.010Z); FY2023: growth capex 1000000; upkeep 480000000; owner earnings 979400000. Growth capex / owner earnings = 0.0010210332856851133.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2024-06-30 (filed 2026-10-16T07:40:53.010Z); FY2024: growth capex 0; upkeep 590000000; cash acquisitions 5000000; owner earnings 79600000. Growth capex plus acquisitions / owner earnings = 0.06281407035175879.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2025-06-30 (filed 2026-10-16T07:40:53.010Z); FY2025: growth capex 0; upkeep 440000000; cash acquisitions 0; owner earnings 236600000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://eodhd.com/api/fundamentals/NZT.STU.json#2026-06-30 (filed 2026-10-16T07:40:53.010Z); FY2026: growth capex 0; upkeep 375000000; cash acquisitions 0; owner earnings 523600000. Growth capex plus acquisitions / owner earnings = 0.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:40:53.010Z); Dividend observations: [[2017,0],[2018,458000000],[2019,459000000],[2020,459000000],[2021,330000000],[2022,449000000],[2023,486000000],[2024,494000000],[2025,302000000],[2026,387000000]]. Zero only counted when supported by a complete cash-flow statement.

### Are managers owners

Insiders own 7% of the company.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16); SPK.AU SharesStats.PercentInsiders = 6.99 percentage points; cache date 2026-10-16.

### What the price says

The price assumes cash profits shrink 4.4% yearly over ten years.

- Source: https://eodhd.com/financial-apis/stock-etfs-fundamental-data-feeds/ (filed 2026-10-16T07:40:53.010Z); Ten-year compound average after fade. Initial solved rate -0.07495439257506092. Price 1.54; FX 0.8124078517533463; discount 0.1; same standard ten-year fade to terminal 0.03. FY2016 owner earnings/share -0.0018770382404718247 → FY2026 0.277037037037037. Closing-price date 2026-10-15.

## Monthly share-price history (AUD per share)

- 2016-10: AUD 3.40 per share

- 2016-11: AUD 3.45 per share

- 2016-12: AUD 3.29 per share

- 2017-01: AUD 3.43 per share

- 2017-02: AUD 3.32 per share

- 2017-03: AUD 3.18 per share

- 2017-04: AUD 3.39 per share

- 2017-05: AUD 3.59 per share

- 2017-06: AUD 3.60 per share

- 2017-07: AUD 3.55 per share

- 2017-08: AUD 3.55 per share

- 2017-09: AUD 3.33 per share

- 2017-10: AUD 3.28 per share

- 2017-11: AUD 3.28 per share

- 2017-12: AUD 3.30 per share

- 2018-01: AUD 3.24 per share

- 2018-02: AUD 3.10 per share

- 2018-03: AUD 3.15 per share

- 2018-04: AUD 3.23 per share

- 2018-05: AUD 3.37 per share

- 2018-06: AUD 3.42 per share

- 2018-07: AUD 3.56 per share

- 2018-08: AUD 3.65 per share

- 2018-09: AUD 3.69 per share

- 2018-10: AUD 3.66 per share

- 2018-11: AUD 3.96 per share

- 2018-12: AUD 4.02 per share

- 2019-01: AUD 3.85 per share

- 2019-02: AUD 3.56 per share

- 2019-03: AUD 3.63 per share

- 2019-04: AUD 3.49 per share

- 2019-05: AUD 3.58 per share

- 2019-06: AUD 3.81 per share

- 2019-07: AUD 3.81 per share

- 2019-08: AUD 4.14 per share

- 2019-09: AUD 4.09 per share

- 2019-10: AUD 4.16 per share

- 2019-11: AUD 4.29 per share

- 2019-12: AUD 4.10 per share

- 2020-01: AUD 4.49 per share

- 2020-02: AUD 4.35 per share

- 2020-03: AUD 4.00 per share

- 2020-04: AUD 4.18 per share

- 2020-05: AUD 4.12 per share

- 2020-06: AUD 4.24 per share

- 2020-07: AUD 4.55 per share

- 2020-08: AUD 4.42 per share

- 2020-09: AUD 4.31 per share

- 2020-10: AUD 4.21 per share

- 2020-11: AUD 4.33 per share

- 2020-12: AUD 4.40 per share

- 2021-01: AUD 4.48 per share

- 2021-02: AUD 4.30 per share

- 2021-03: AUD 4.11 per share

- 2021-04: AUD 4.12 per share

- 2021-05: AUD 4.27 per share

- 2021-06: AUD 4.46 per share

- 2021-07: AUD 4.48 per share

- 2021-08: AUD 4.67 per share

- 2021-09: AUD 4.57 per share

- 2021-10: AUD 4.32 per share

- 2021-11: AUD 4.31 per share

- 2021-12: AUD 4.29 per share

- 2022-01: AUD 4.06 per share

- 2022-02: AUD 4.25 per share

- 2022-03: AUD 4.24 per share

- 2022-04: AUD 4.52 per share

- 2022-05: AUD 4.41 per share

- 2022-06: AUD 4.33 per share

- 2022-07: AUD 4.54 per share

- 2022-08: AUD 4.84 per share

- 2022-09: AUD 4.44 per share

- 2022-10: AUD 4.65 per share

- 2022-11: AUD 4.78 per share

- 2022-12: AUD 5.02 per share

- 2023-01: AUD 4.80 per share

- 2023-02: AUD 4.61 per share

- 2023-03: AUD 4.69 per share

- 2023-04: AUD 4.85 per share

- 2023-05: AUD 4.80 per share

- 2023-06: AUD 4.67 per share

- 2023-07: AUD 4.79 per share

- 2023-08: AUD 4.67 per share

- 2023-09: AUD 4.47 per share

- 2023-10: AUD 4.55 per share

- 2023-11: AUD 4.79 per share

- 2023-12: AUD 4.81 per share

- 2024-01: AUD 4.94 per share

- 2024-02: AUD 4.72 per share

- 2024-03: AUD 4.37 per share

- 2024-04: AUD 4.33 per share

- 2024-05: AUD 3.80 per share

- 2024-06: AUD 3.83 per share

- 2024-07: AUD 3.93 per share

- 2024-08: AUD 3.33 per share

- 2024-09: AUD 2.82 per share

- 2024-10: AUD 2.65 per share

- 2024-11: AUD 2.65 per share

- 2024-12: AUD 2.69 per share

- 2025-01: AUD 2.63 per share

- 2025-02: AUD 2.05 per share

- 2025-03: AUD 1.87 per share

- 2025-04: AUD 1.93 per share

- 2025-05: AUD 2.08 per share

- 2025-06: AUD 2.25 per share

- 2025-07: AUD 2.23 per share

- 2025-08: AUD 2.32 per share

- 2025-09: AUD 2.06 per share

- 2025-10: AUD 2.14 per share

- 2025-11: AUD 1.99 per share

- 2025-12: AUD 1.95 per share

- 2026-01: AUD 1.96 per share

- 2026-02: AUD 1.92 per share

- 2026-03: AUD 1.73 per share

- 2026-04: AUD 1.70 per share

- 2026-05: AUD 1.63 per share

- 2026-06: AUD 1.54 per share

- 2026-07: AUD 1.63 per share

- 2026-08: AUD 1.77 per share

- 2026-09: AUD 1.60 per share

- 2026-10: AUD 1.55 per share

## Annual estimated value (AUD per share)

- FY2020: low AUD 1.84 per share, central AUD 2.09 per share, high AUD 2.43 per share

- FY2021: low AUD 1.88 per share, central AUD 2.14 per share, high AUD 2.49 per share

- FY2022: low AUD 1.98 per share, central AUD 2.25 per share, high AUD 2.61 per share

- FY2023: low AUD 2.18 per share, central AUD 2.48 per share, high AUD 2.88 per share

- FY2024: low AUD 2.16 per share, central AUD 2.46 per share, high AUD 2.85 per share

- FY2025: low AUD 2.06 per share, central AUD 2.34 per share, high AUD 2.72 per share

- FY2026: low AUD 2.05 per share, central AUD 2.33 per share, high AUD 2.70 per share

Historical values use today's bond yield for every fiscal year

Historical values use today's FX rate into trading currency for every fiscal year

Historical values use current restated fundamentals and current commodity classification; they are not point-in-time estimates

## Sources

Estimates depend on assumptions and are not guarantees or investment advice. Underlying data remains subject to its source licenses; public reading does not grant bulk redistribution rights.