KUALA LUMPUR (Jan 23): TIME dotCom Bhd (KL:TIMECOM) may pay out all of its profits in the next two years to shareholders, a research house said, amid rising dividend expectations that sent its shares to new record highs.
The internet service provider would still be in net cash position beyond 2027 with distribution of 100% of its earnings, Maybank Investment Bank said in a note. TIME dotCom could sustain a 150% payout, providing dividend yields of up to 7.0% in 2026, before it turns net debt, the house noted.
“We believe it is possible for TIME to distribute its entire cash reserves,” Maybank Investment said.
TIME dotCom climbed to a new record high of RM5.86 on Friday. Its shares have gained 28% in value after the company announced a relatively massive special dividend in November, prompting more analysts to turn bullish on the stock.
The company has been in a net cash position, partly due to stake sale of its data centre entity AIMS in 2023. While TIME dotCom has conservatively committed to paying out 50% of its profits as dividends, the company has surprised investors with special dividends since 2015.
The company most recently declared a special dividend of about 22 sen per share.
The gain in the past two months is likely in reaction to a more proactive capital management, said Maybank Investment.
“Amid tapering growth, the management’s more proactive stance on capital management has reinforced our thesis of TIME morphing into a yield stock,” the house said and kept its ‘hold recommendation.