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Dan
why is it that the vodafone market cap has increased since the announcement of the 4 Billion buyback - in your mind it would make no sense as you say that the valuation would go down.
''That disposal, along with other deals, has left Vodafone with a load of cash, €4 billion of which it will return to investors via buybacks. Predictably, investors cheered, the stock is up about 4% this morning.''
https://www.bloomberg.com/news/newsletters/2024-03-15/vodafone-plans-4-billion-share-buyback-after-asset-sales
Dan
''This is basic stuff, so please can we move from this nonsense. L.T.I. please give us a break, because you have not a clue what you are talking about.''
I think it is you who is coming out with nonsense. You have a lot to learn
''because there are less shares in circulation after cancelling the shares, each share will be worth about the same''
if they remain the same after spending 4 Billion euro, that would equate to a 4 Billion devaluation of Vodafone meaning the market cap falling from the current £19 Billion to
about £15.58 Billion.
THINK AGAIN - who on earth would be investing with that sort on devaluation.
I think you will find that the market will value Vodafone on it's profitability which will not be affected negatively with the sale of non performing assets.
The market cap is likely to remain at about the same level or increase from full year results time as the benefits of the vodafone investment materialises.
Share buy backs. If vod spend 4 billion euro's buying back shares, then of course 4 billion euro's comes off it's balance sheet (not rocket science is it?) But because there are less shares in circulation after cancelling the shares, each share will be worth about the same. This is basic stuff, so please can we move from this nonsense. L.T.I. please give us a break, because you have not a clue what you are talking about.
Rob. Up is good, down is bad. You can't argue with that. Well some on here can, but what can you say? It is alright for you though with big profits from international funds, . Have a good good weekend mate. Don't let your wife nag you into buying premium bonds?! Are you a man, or a mouse??!! Nice to see fleccy back, but I still can't understand what he is going on about. One day perhaps I will? Cheers fleccy. The only way is up. New tax year Monday. So time to buy into an I.S.A. if this year is full up. I am hoping for a big rise after Monday.
Well let's hope the results will give this a good push up, i mean down then up again before next year i think lol
very confusing this, i think i will go and buy some premium bonds, then i know i just want them to win
anyway good luck all and let's hope it's a good day tomorrow, urgh what is a good day
cheers LTI
Fleccy can i have a second opinion please
only joking guys
May 14th is the next date of significance - hopefully will get a more accurate timing for the start of the buyback
It will be interesting to see if you guys are shouting for this to go up or down tomorrow
Downe 530, I is afrade tommorow culd be a verey bade daye agane sadley.
Nuthin will make vodefone go upp.
Kr
are you a shareholder? if so are you selling ?
Downe ovver 500 points rite know
"Kr
''Anyone who thinks that a business can cannibalise itself to buy back it's shares and somehow be worth the same at the end of it with less shares in issue needs to start engaging their brain.''
you have a lot to learn"
Everyone does. Those who think they don't tend to just be arrogant and belligerent.
"Kr
as i said -
Anyone who thinks that the Vodafone valuation is going to drop by 4 Billion euro (a large percentage of current market cap) maybe should stay clear for a couple of years."
Why? If the valuation drop is matched by a reduction in shares, it's largely zero sum. Anyone who believes that the main catalyst for an improved share price is buy backs funded by one off asset sales are probably the ones who are better off steering clear.
Kr
i expect if you are a shareholder you will be contemplating selling, with the 4 Billion 'devaluation' coming up
Kr
as i said -
Anyone who thinks that the Vodafone valuation is going to drop by 4 Billion euro (a large percentage of current market cap) maybe should stay clear for a couple of years.
Kr
''Anyone who thinks that a business can cannibalise itself to buy back it's shares and somehow be worth the same at the end of it with less shares in issue needs to start engaging their brain.''
you have a lot to learn
"Anyone who thinks that the Vodafone valuation is going to drop by 4 Billion euro (a large percentage of current market cap) maybe should stay clear for a couple of years."
Anyone who thinks that a business can cannibalise itself to buy back it's shares and somehow be worth the same at the end of it with less shares in issue needs to start engaging their brain.
"''then clearly it will be valued at less.''
why is that? - what value was the market placing on non performing assets that may have continued to deteriorate further , before a clear cash amount was offered.? "
The value is 4 billion for Vodafone Spain and 8 billion for Vodafone Italy which has now, or will be, realised through their sale. If 4 billion of the money generated as a result of that one-off sale of assets is spent on the buying back shares, you will have less shares and a company worth, give or take, 4 billion less. Combine the two together and I'm not sure it will have the much impact on the share price one way or the other.
I has bean talkin abowt this for somme tyme.
The sell of have beggun in USA, dowe down 430.
I takes a lott off stick hear for tellin the truff.
Somme off use don't like the truff.
You wants me to blowe hot air up you're a s s es, well that's ain't hapening...
Anyone who thinks that the Vodafone valuation is going to drop by 4 Billion euro (a large percentage of current market cap) maybe should stay clear for a couple of years.
Kr
''then clearly it will be valued at less.''
why is that? - what value was the market placing on non performing assets that may have continued to deteriorate further , before a clear cash amount was offered.?
An asset is no good to a business if there is no return. Profitability of Vodafone will not be decreased from the asset sale, and the market likes profits on deployed assets.
The price per share has risen about over 10% from recent lows, despite some saying that the price would plummet further on an announcement of a dividend cut let alone a 50% cut.
4 Billion euro is being invested in Vodafone stock, not being paid as a 'special dividend'.
Each shareholder retaining their shares will see their percentage ownership increase by an amount , dependant on the reduction in share count.
From what you have posted you are expecting a depreciating of value effect during the course of the 4 Billion investment. I would be more than happy if the buybacks were conducted at these price levels throughout.
"Buybacks have NOTHING to do with what the market values a business at (market cap). "
Perhaps not in all instances but if a business uses a few billion Euros it gained from a one off asset sale, rather than cash it generated, to buy back the shares, then clearly it will be valued at less.
Rob
'' let's hope it can change direction''
that is the hope of the reset - selling non performing assets whilst they still had some value to someone, reducing the dividends and investing in the remainder of the Vodafone business that give a return via buybacks
Totally incorrect
There are many factors that are use to determine SP, and 100% a companies NAV and DCF estimates play some part in the SP value. To imply otherwise is disingenuous at best, and plain stupid at worst. So which are you LTI?
LTI, well i will give the thumbs up for whatever pushes the share price up, whatever it may be, you know full well this has been going in the wrong direction for far to many years, let's hope it can change direction
Rob
''Lloyds have done massive buybacks, ok the share price is up at the moment, but not sure if the buybacks can take any credit for that''
Lloyds is my 2nd largest holding after HSBC
Buybacks have NOTHING to do with what the market values a business at (market cap).
The sole purpose of a buyback for cancellation is to reduce share capital.
The reduction of shares in issue will mean that the price per share will be higher than it would otherwise have been.
A share price could be lower as well as higher after shares have been removed from the market - determined by the valuation that the market places on the business.
Dan, shall we stick to our old and trusted formula, if the share price is going up it's good if down not so good, unless? we won't go there,
Lloyds have done massive buybacks, ok the share price is up at the moment, but not sure if the buybacks can take any credit for that, I think fleccy is right, the markets players will decide on the price depending on sentiment