American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Business

Vodafone share price rally has stalled: buy, sell, or hold?

by admin October 16, 2024
October 16, 2024
Vodafone share price rally has stalled: buy, sell, or hold?

Vodafone (LON: VOD) share price has done well this year, helped by its ongoing transformation under Margherita Della Valle, the CEO. It has jumped by more than 25% from its lowest point in February.

Slowing blue-chip company

Vodafone is one of the biggest telecom companies globally. According to Companies by Market Cap, it is the 29th biggest player in the world and the sixth in Europe.

It has operations in Europe, Asia, Africa, and other countries, where it offers broadband, fixed line, internet, mobile money, and other solutions to millions of companies. 

Its biggest markets are in the UK and Germany, which account for a substantial share of its business. It also has major operations in India, through its troubled Vodafone Idea brand. 

Vodafone has been in a transformation journey in the past few years. As part of this strategy, the company has exited some markets and business solutions. 

For example, it spun out its tower business as a standalone company known as Vantage Towers in 2020, and has been reducing its stake since then. In July, it sold another 10% in the company worth 1.3 billion euros.

Vodafone has also exited some other less profitable markets. It sold its Spanish operations to Zegona in a $5.3 billion and its Italian business to Swisscom for 8 billion euros. 

The company has used these exits to boost its balance sheet by reducing its substantial debt, with its leverage being between 2.25x and 2.75x. The exits also helped the management to right-size the brand by focusing in countries where it has a substantial market share. 

Additionally, investors benefited by increased distributions. In a statement, the firm said that it would provide €4 billion in share buybacks. It will also rebase its dividend to 4.5c per share from next year. 

Vodafone’s stable business

Like most telecom companies of its size, Vodafone is no longer a growing firm since most people already have their phone subscribers.

People who invest in the company do so because of its stability, dividends, and room for improvement.

The most recent financial results showed that Vodafone’s total revenue rose by 2.8% in Q1’25 to €9.03 billion. This growth was primarily because of its service revenue, which rose by 3.2% to €7.46 billion. 

A key concern among many investors is that Germany, its biggest market is not doing well as competition with Telefonica and Deutsche Telekom rising. Its German revenue dropped from over €3.14 billion in Q1’24 to €3.095 billion in the same quarter this year. 

The German growth has been offset by Turkey, where revenue soared from €456 million to over €664 million. Its UK and African operations are also doing well.

The case for Vodafone

A case for investing in Vodafone can be made. First, today’s Vodafone is much different from the one that existed a few years ago. It is a leaner company that will be more profitable in the coming years.

Second, the firm is solidifying its market position in the UK through its merger with Three. The resulting company will be a more formidable competitor to BT Group, the parent company of EE. 

Third, Vodafone has a strong dividend yield of over 9%, making it one of the top-income companies in the FTSE 100 index. It will remain a solid income play even after rebasing its dividend next year. 

Additionally, the management has room to shed or improve some of the other weak businesses like Vodafone Business. 

Vodafone share price analysis

The daily chart shows that the VOD stock price has done well in the past few months, helped by its strong turnaround. It has risen above the 23.6% Fibonacci Retracement level, meaning that bulls are in control.

The stock has also formed an ascending channel and remained above the 100-day and 50-day Exponential Moving Averages (EMA).

It has also moved above the key support at 72p, the lowest point in December 2022 and the 23.6% retracement point.

Therefore, the stock will likely continue rising as bulls target the year-to-date high of 80p. A break above that level will see it rise to the 50% retracement point at 86p.

The post Vodafone share price rally has stalled: buy, sell, or hold? appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
Why Google and Microsoft are turning to nuclear power for their AI data centers
next post
Long SOTK: Sono-Tek Earnings Beat Expectations, Rounded Bottom Pattern and Strong Data Suggest Bullish Extension

Related Posts

Extreme heat is prompting higher home cooling costs....

August 1, 2024

iDEGEN presale gains surpass expectations, overshadowing Sui’s bearish...

January 23, 2025

S&P 500, Nasdaq close at all-time highs ahead...

July 12, 2024

Burberry share price jumps 15% on cost cuts...

May 14, 2025

Metaplanet buys 1,005 BTC, issues over $200M in...

June 30, 2025

Intel shares plunge 28%, dragging down global chip...

August 3, 2024

Shipowners reroute from Strait of Hormuz as conflict...

June 17, 2025

Target says Pride collection will appear in ‘select’...

May 15, 2024

AMD stock price analysis after the $245 billion...

April 17, 2025

SMH, SOXX, FTXL, SOXL ETFs crash as chip...

April 14, 2025

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • Kraft Heinz plans breakup, weighs $20 billion grocery spin-off: report

      July 13, 2025
    • Trump’s 50% tariff on Brazil imports to brew trouble for Starbucks and Dutch Bros

      July 13, 2025
    • US to announce 30% tariff on EU and Mexico says Trump

      July 13, 2025
    • Why India is rushing to build bigger banks and what’s standing in the way

      July 13, 2025
    • Wall Street braces for weakest earnings season since 2023 amid market highs

      July 13, 2025

    Categories

    • Business (3,388)
    • Investing (2,615)
    • Latest News (2,017)
    • Politics (1,530)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved