Vodafone Share Chat (VOD)

Aren't vodafone being sneaky and the press buying it as to the '40%' cut? Might it really be a 60% Dividend cut? That the interim dividend has already happened means technically it is 40% cut for this year. But come November is the next interim dividend really going to be held as per the last amount? Doubt it.

Excuse superfluous use of certain words in last comment as also focused on trading screens when posting. Cheers.

Hi trendfriend.

Quality post. I also went long yesterday, quite heavily, then to protect myself layered in some shorts near the close.
Almost all of those shorts closed, took the view that it bounces back up.

So now am net long and fairly heavy at that.
I also think it recovers, in time, could be some more pain along the way though.

I think the floor is not far away.

Sad to read of some being in so much loss.

ATB

soi

After almost a 10% drop this week the damage is already done and personally I would wait now and see if the SP settles at this level....
For the few remaining longer term holders thinking of selling....there are no doubt x 10 or more sniffing and noseying on the sidelines waiting to buy

For a few days it will no doubt be a bull/bear play-off

How many of those bears will soon decide to turn bulls ??

Hi Poker,

Thanks. Too right about their history. For eg. they paid £112 Billion or Mannesman in 2000. Also, new huge new investment tends to be essential every few years in this sector as tech changes fast. Net gain is minimal, bar keeping up with rivals.

I wish I'd read Peter Lynch's old investment/trading books before buying here. He's a successful investor with certain golden rules. He avoids sectors which need huge investment every few years at little net gain to holders. Ditto stocks with large debt. In his view, however rosy the picture looks on the surface when targets are being met, as soon as fundamentals deteriorate, markets easily get spooked by huge debt & sell off.

Thus he also avoids stocks paying generous dividends if allied with huge debt because if divis ever need significant cutting ( as here), large investment funds will ALWAYS exit substantially & transfer their funds into other top yielders, leaving SP battered & often facing very long roads to recovery. All sensible advice really. Hopefully, another lesson learnt for me. - Regards.

Cut Your Losses............ Centrica was the other one.gla.

Talking of history of overpaying was it really in Feb 2000 they took over Mannesmann bringing the sp down from £3.00 to £1.50Everyone saying o well in a few years Vod will be up and away and we will realise how cheap this was. Well 20 years on and its £1.25. As the Guardian puts it 'a dull utility'. Great investment for the supplier of plastic blue cricket bats and stumps for kwik cricket. Perhaps they should have stuck with that!

I’m going to hold but think this is a buying opportunity.

Hold.

I’m in a deep hole here down 80k average 177 ,Do I keep digging and average down or wait for the recovery, The reduced Dividend is still better than I can get putting the money on deposit.

Are positive buys again. Some people may scoff at these. But they are credible financial institutions. They don't just fly a kite and hope. They do their sums. GLA

Jack,
At the end of the day the debt reduction plan is basically asking shareholders to pay for the writedowns in India and the writedowns in acquisitions elsewhere, which have ended up on the debt pile

VOD paid 7.2 billion euros to buy Ono in Spain....and look at the revenues there now and the price war going on
I bet a fair few of those Ono customers are now using Vod Lowi ..https://www.lowi.es/ low cost branding....

VOD has a history of paying high prices to acquire customers and then finding it competitively tough to extract a decent customer profitable return from them

They have to change that with 5G and shared infrastructure etc with other operators.

The whole sector has to reduce combined Capex and work on better returns

The new CEO would try to set an achievable hurdle to trigger his long term incentive plan ( " bonus"). After all, he's in the job to make himself rich..not the shareholder.

" I totally agree with previous comments stating that the market is enequivocally underwhelmed by Vodafone’s plans going forward."

Indeed...but it may turn out that Read has decided to be cautious on guidance ....and go for the underwhelm on guidance but then over-deliver on results approach. ..... given that the market gives you a hard kicking if you dont meet your guidance expectational figures.

The div cut was a blow to the SP so why not tuck in with it a cautious guidance outlook in order to keep your head down for the moment and divert attention until later on in the year .....

Behind the scenes VOD are actually extremely busy and doing an awful lot in terms of getting 5G ready for 2020-2021 and beyond .....amongst a number of other IoT projects ......

One should try to maintain a positive outlook, difficult though it has been over the last two trading days. The sell-off will eventually subside, and then investors will have some idea as to how and when the share price will recover. I have lowered my target to 160p; I intend to leave this particular stage with a profit.

I totally agree with previous comments stating that the market is enequivocally underwhelmed by Vodafone’s plans going forward.

One positive!(!)..at least the share buyback programme is reducing shares at the current price and not £2 plus. They will be reducing their dividend burden going forward.

This reminds me of similar regulation applied to the energy industry a few years ago. There was a time when I switched my e.on contract three times in a matter of months, with each effecting a small saving. As long as all the telecom companies, including the minnows, are obliged to apply the regulations EVENLY, there should be some benefit to customers - without a detrimental effect for VOD shareholders.

Broadband, phone and pay-TV providers will be required to tell customers when their contract is coming to an end and give details of the best deals available under new rules announced by the telecoms regulator. The move by Ofcom aims to stop up to 20m loyal subscribers falling onto high tariffs and allow them to identify better deals with either their existing provider or a competitor.
One in seven consumers do not know whether they are still tied to a telecoms contract while one in eight do not know when their contract ends. Consumers who do not sign a new deal after their contract period expires generally face significantly higher bills.
Customers purchasing landline and broadband services in a single bundle pay an average of 20pc more after their initial fixed-term contracts expire, Ofcom said. For customers whose bundles include TV packages, this rises to 26pc.
"We're making sure customers are treated fairly, by making companies give them the information they need, when they need it,” said Ofcom's Lindsey Fussell. “This will put power in the hands of millions of people who're paying more than necessary when they're no longer tied to a contract."
Under the new rules, providers must send personalised information to customers by text, email or letter between 10 and 40 days before their contracts are due to expire. From Feb 15, 2020, providers will be required to inform customers of the best deals available, including details of prices available to new customers. New customers often benefit from cut-price deals as telecoms companies aim to woo them from rivals.
The alerts must also include details such as the contract end date, any changes to the price after that date and the notice period for terminating the contract. Customers who do not switch provider or sign up to a new contract must be sent an annual update about their provider's best deals.
“Ofcom is finally moving the telecoms sector towards what consumers have come to expect in other areas such as energy and insurance,” said Richard Neudegg, at uSwitch.com. From July, new rules will also make it quicker and easier to switch mobile provider.
The changes do not go as far as some had hoped. Citizens Advice had called for providers to be required to send more than one notification to customers and to reveal how many of their customers were out of contract, as well as the average difference in prices paid by in-contract and out-of-contract customers.

Mikey,

L/T chart look bad. It could even eventually see circa 116 at this rate. Markets simply unimpressed with NR's forward guidance & his debt-reducing plan.

As I said earlier, if the EU refused to sanction this Liberty Global deal, decision next month (actually part of former CEO Colao's strategy), they may be doing us a favour. Standard use of 5G technology, especially via mobiles, is years away! Since this deal, it's all been downhill for VOD. - Regards.

This is ******* relentless

dog share.

What amazes me, VOD is one of the biggest companies in the telecoms world but yet the SP doesn't show that.
Temptation is always to sell on a falling share, But hey-ho, I will just hang onto them for now

Once the market gets over its itself and stops banging on about Vodafone's debt, i can see big upside.
Telecoms are a necessity of modern life and VOD have assets in a big chunk of the world. Competition may be an issue, but you're going to have that in any lucrative industry. NZ is out on a limb, so i can see why they saw it as a disposable asset.

https://www.sharesmagazine.co.uk/shares/share/VOD/fundamentals

Vodafone is also stripping out costs, improving and selling off parts of its mast infrastructure, and overhauling its customer service systems to reconnect its growth, but the scale of the losses registered last year signals the size of the task faced.
The company reported a loss of €7.6bn as its trading challenges were compounded by the merger of its Indian operation with a rival. The defensive deal crystallised the firm’s struggle to compete in a mobile price war with Mukesh Ambani, the subcontinent’s richest man, and asset impairments.

Total turnover of €43.7bn signalled a decline of 6.2pc, which include the impact of Vodafone’s exit from Qatar. After adjustments for costs the company said were exceptional, organic service revenue crept up just 0.3pc. As Mr Colao’s former right hand, Mr Read cannot claim he was ambushed by the company’s problems. Yet he did not expect Vodafone to be a turnaround job.

Part of yesterday’s Daily Telegraph interview with Nick Read.

There has been no honeymoon for Nick Read since he took over at the helm of Vodafone in October.
After steering the company through the back end of a “challenging year”, the former finance chief was forced on Tuesday to take action no boss of the mobile giant has had to take in nearly three decades.
Following an unbroken run of increases, one of the stock market’s biggest and most dependable dividends was finally ended with a cut of 40pc.
Coming only six months after Vodafone rejected pressure from the City to curb the payout, it signalled a tricky about-turn for the new chief executive to execute.
“I would say it has been a disproportionately challenging year,” he offered by way of explanation.
“We had sufficient headroom [in November] – but a combination of factors meant it was feeling very tight.”
Vodafone’s sprawling global empire has always delivered a mixture of bright spots and dark corners, but in Mr Read’s first six months the balance has tilted against him.
A protracted price war in Spain, fierce competition in Italy and recession in South Africa have conspired to squeeze the finances. Growing markets have slowed too.
Set against heavy debts that are poised to balloon towards the €50bn (£43bn) mark this summer when Vodafone completes its €18bn takeover of Liberty Global cable networks in Germany and central Europe, the dividend became too much for the company to bear.
The borrowing will nudge Vodafone beyond its debt target and ratings agencies have already increased the price Mr Read must pay to tap the bond markets. The last year’s dividend bill of more than €4bn could not be repeated, much less outspent, especially as bills for 5G licences begin to mount up.
Italy and Germany’s auctions of frequencies for the new technology, which also requires a major overhaul of network equipment, have already surpassed cost estimates. While Mr Read insisted that a recent downturn in Vodafone’s fortunes forced his hand, some investors had expected to arrive ever since his predecessor Vittorio Colao agreed his big final deal with Liberty Global a year ago.
The share price has been southbound ever since, and on Tuesday lost almost another 4pc, to leave the company resting at its lowest level since late 2002 and the post-dotcom slump.
“Are we happy with the share price where it is today?” said Mr Read. “No, and we’re working really hard with a lot of urgency to improve the situation.”
He assured investors that the fourth quarter of last year, when organic service revenue, the measure of Vodafone’s core business, declined 0.6pc, would mark a nadir. In the first half of the new financial year turnover growth is expected to return, a moment Mr Read said would be a “key lever” to lift the shares.

In football there is a Premier League and of course lower divisions....so ideally you learn and move up as you excel

In the stock market ...there is only one division and everyone whether experienced or a beginner or a master trader is all mixed in together....

That makes it more difficult and a big mistake can be very costly...

My advise is...

Dont act on what you think.....

Act on what the MARKET thinks...

A bull and a bear are big beasts and you fight the wrong side of either and you will ALWAYS come off worse

Stay safe...sleep easy...and dont have nightmares LOL