"This is clearly a huge vote of confidence for Avanti coming from a major European telecoms network operator and for mission critical work. As well as potentially serving as a stepping stone to other work for the wider Vodafone group, we believe this contract win will act as an excellent advertisement to other carriers considering Avanti for similar work."
However the T1ps view is that Avanti is a speculative buy, due to various risk factors, including the unpredictability of earnings.
It does seem that we are talking here of an investment that involves the possibility of huge rewards, but that carries risks. Living is risky, I for one am excited by the possibilities of the huge rewards and continue to accept the risks. What do others of you say?
See that this is already getting a fair bit of press. Anything to do with Vodafone always gets good press coverage. Expecting to see this climb this afternoon and rest of the week should be positive for the sp.
Avanti shares have climbed 6% to 217.75p on the news. Analysts at French bank Natixis said:
The service will enable Vodafone to connect up its base stations and core network at a much lower cost than with terrestrial solutions (fibre, DSL, radio) in isolated and sparsely populated regions.
Avanti had already mentioned that it was conducting tests with Vodafone. As such, this contract is not entirely surprising. It is still extremely good news for Avanti, however, as it provides proof of the quality of Avanti's backhaul solution, [it] will substantially boost the group's prospective sales in the second half of 2014 [and] in the medium term, it opens up enormous potential in terms of demand. Indeed, the connection of just 2,000 base stations would be enough to use up all of the capacity on the two satellites Avanti currently has in orbit.
Tomorrow should be another blue day. There should be a mention of the new contract in the national press, although it's a little disappointing that no figures have been provided. City Confidential should also give an update soon, either tomorrow or next week - they added Avanti shares to their Aggressive Growth Portfolio in December 2013 @ £2.43.
Datafeed and UK data supplied by NBTrader and Digital Look.
While London South East do their best to maintain the high quality of the information displayed on this site,
we cannot be held responsible for any loss due to incorrect information found here. All information is provided free of charge, 'as-is', and you use it at your own risk.
The contents of all 'Chat' messages should not be construed as advice and represent the opinions of the authors, not those of London South East Limited, or its affiliates.
London South East does not authorise or approve this content, and reserves the right to remove items at its discretion.