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Vodafone connects people throughout Europe and beyond, providing wireless voice and data services.
This deal needs to happen more for Vodafone than Liberty, Vodafone is pretty much a mobile only offering in a quad play world (think BT/EE - best in class 4g, fibre, tv including football rights and land line) yes it has some cable assets in Europe.http://www.ft.com/cms/s/0/24db757c-9ea1-11e5-8ce1-f6219b685d74.html#axzz3uPaN5Vtd“The deal depends on the valuation between Vodafone and Liberty narrowing?.?.?.?more simply the share price of Vodafone has to go up a fair bit to make it work,” as this would probably be a merger not a takeover especially given the state of the high yield market and the issuance size that Liberty/Malone would require (also leverage would become far too stretched if all cash).Deutsche pushing the sector this morning also in a 2016 sector outlook (worth a read given its our biggest sector overweight) We view that there were two main drivers of Telco out-performance, hopes for consolidation and improving top line trends. Whilst a number of deals were announced (BT+EE, O2+3, Wind+3) hopes that the European authorities would wave through these mergers with limited remedies were dealt a blow in September on collapse of the deal to merge TeliaSonera and Telenor assets inDenmark). More consolidation an upside, not a necessary precursor to sector performance The dip in telco shares and sentiment on the sector post cancelation of the Denmark deal was material. Our note “Growth re-rating further to run, though EM still drags” dated 16 September 2015 however flagged that the event was more of a removal of a tailwind than headwind and the sector has recovered. We also note that widening credit spreads which compounded the difficulties for Altice financing the acquisition of CVC also hit confidence on the sector, though we note that European Telcos as a whole tend to do well, relatively, at times of widening credit spreads.We remind that remedies on mergers are designed to prevent a diminution in consumer price competition but still produce benefits for the merging parties, such as lower costs. Regulators are seeking new powers to regulate ‘tight oligopolies’ to ensure that consolidation does not result in a negative outcome for consumers. We assume the O2-3 and Wind-3 deals to go through albeit with significant remedies up to and including the effective establishment of a fourth operator in each market. Such a scenario should not be worse than the status quo at least, but we note that in the UK, a simultaneous push by BT into mobile for the first time could result in an increase in competition in a market that was somewhat resilient to the travails of other European markets.Regardless of consolidation European Telco revenue trends are improving chiefly driven by mobile, post subsidence of four simultaneous drags on growth: the economy, regulation, competition (exacerbated by weak private consumption and facilitated by regulation) and lack of secular growth (e.g. demand for mobile data has been depressed in part due to economic factors but also lower network investment than in other regions). We see upside risk to growth particularly from mobile where our expectations have been moving higher.Maurice Patrick, analyst at Barclays, says there has been an inflection point in Vodafone’s performance. “Revenues are now going up again following Project Spring and there is capacity to cut costs, leading to the potential for 5 per cent [core earnings] growth with a fully covered dividend,” he adds.A fully covered dividend (Vodafone has had the highest yield + bonus yield in Europe over a 5yr time frame) in excess of the market with earnings growth looks like an investable prospect to me.
Part of a screener test. I looked at 4-5 star stocks, with a dividend yield above 2.5%, gross margins above 25%, price 0-50% below 52-week high, with 3-year EPS of 5+, P/E < 40. These are all interesting PEGY plays for me.
The European malaise will end sooner rather than later. Now that Vodafone is disentangled from Verizon they are free to expand their networks and upgrade their installed infrastructure. Also, they are expanding (further) into new emerging markets. Big opportunity in an undervalued safe stock which also yields better than 3% dividend.
fundementals look good, expanding network
With it’s large infusion of cash, from the Verizon deal, I look for them to increase their footprint in the developing world.
Scruffy believes in this company.
went up for portofeile. Belgian company
Cashing in on Verizon sale and investing in strong growth markets and strategies.
Early first pick for this portfolio. Has been both up and down, but holding has reduced my start price.Div. (Yield) $2.06 (4.3%) (wrong....5.8%)Current Yield 9.0%
60% of their profit came from Verizon.
Cash used from VZ stake buy out will boost opportunity for expansion in other parts of world and make happy shareholders.
Dividend should be pretty great!
With VOD owning 45% of VZ, it's likely VZ will buy it out, otherwise, Vodafone is expanding it's businesses from U.K and Europe into Eastern Europe, Mid East, and especially, the EXPLODING AFRICAN CONTINENT!
real money: mom and kids
Great Price to Accumulate, Owns 45% of verizon which itself is reason to buy which fetches at least $20 when Verizon buys the shares from Vodafone, Also, I believe Kabel Deutschland deal will go through , In addition to all this there is very good dividend to wait for the right time.
nice dividend ,while waiting for big payout fronm verizon
as the economic situation in europe stabilizes, vodafone will stabilize. further consolidation potential in telco industry and potential verizon wireless buyout provides upside
Possible take over, big dividend, low P/E
The second largest mobile company in the world, after China Mobile. They have had a growth of 100 million customers from 2011 to 2012 and is therefore close to half a billion customers. They are present in something like half of the world.I imagine that Vodafone sooner or later will provide some sort of international subscription, that will be attractive to many people (business and travelling) and be hard to compete with for other mobile operators.The need for mobile voice and data is growing. It provides a comfort that people do not want to be without once they have become accustomed to it.They have a low price / book ratio of 1.3, and they provide a good dividend of approx. 3.5%.So I consider this a good growth stock with a nice dividend.I personally used their service in Germany and Dominican Republic on vacations, buying a local sim, and I was very satisfied by their 3G coverage. The service in Germany was very good. The service in Dominican Republic was bad to put it mildly, but that's the standard outside the tourist resorts.
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