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Well at least we stayed above £1.36 - could have been a lot worse .
Just as it claws some back America opens .
Russian roulette. Lets hope the odds on a Russian invasion are more then 5/1 against? Micky is sounding very calm? Hopefully not the calm before the storm?
"nor am i sure the prices are not going to drop further"
Trying to judge the bottom, or top, when it comes to shares is a futile exercise and not something I worry about, I just invest where I see value.
That sounds the sensible thing to do fleccy, but not sure if putin cares about any of that, nor am i sure the prices are not going to drop further
"Mikey, your spot on there mate, look the other way for a few days at least, everything's taking a thumping today"
It depends on your assessment of the geopolitical outcomes, and your attitude to risk. I bought more Lloyds this morning, when the price was over 4% down, but I don't believe Russia will invade Ukraine due to the consequences.
I don't see Russia invading Ukraine, because the Russians will likely get a bloody nose from the war itself, with lots of casualties on both sides; Another reason is the crippling sanctions, which will likely lock Russia out of western world finance; Another might be a stronger Europe, with the EU arming up to become another potential superpower on Russia's doorstep. History shows occupying armies don't have a good track record, and Russia could open themselves up to resistance movements within occupied countries, and terrorism at home. There are multiple reasons why Russia invading Ukraine would be bad for Russia, with the only possible gain, from an invasion, being short lived hubris.
There's a possibility that Russia and China have quietly decided to form some sort of pact, with Russia taking Ukraine and China taking Taiwan, purposely aiming to hard split the World between East and West, but that would be a dystopian outcome, and would it suit China and Russia?
Mikey, your spot on there mate, look the other way for a few days at least, everything's taking a thumping today
Yep. Bit of a bloodbath this morning with European indexes down 3% +.
Markets could quite easily pull back 10% + from here, or rebound sharply if everyone kisses and makes up.
Might be a rough few weeks / months, but geopolitical problems historically don’t cause bear markets - only recessions do that.
Underlying world economy is still good, Vod still undervalued and won’t be directly effected by any regional conflict.
Any losses should be regained during the course of the year.
I’ll be riding this one out as markets could swing either way within a few minutes of any news.
Time to stay away from the share price - too much going on with Russia etc . Markets are going to be all over the place . Hopefully we can stay above £1.30
Not entirely unexpected, in view of the merger between VM and O2. I wonder if VMO2 will have to pay compensation to VOD, for terminating the contract early. It's further proof that the tie up betwen VM and O2 was carried out in extremely short order, since the agreement between VOD & VM was only inked 6 months before the VM O2 merger. It makes me wonder what drove the urgency for the VM O2 merger, to be pushed through so quickly.
I'm surprised there isn't more articles mentioning this.
Good find Mikey. I was always surprised VOD gave 5G access to VM especially as VOD incurred the cost of end to end service and network build. I drove past 3 HQ in Maidenhead yesterday and the building is empty, moved to Reading apparently. A 3/ VOD tie up probably pushes VOD to cut the overhead cost of the Newbury Campus also (or share it).
Looks like UK deal landing anytime soon? Hope the SP dips so I can buy back my recently sells.
**I guess if VOD is entering a period of low/ less intense capital reinvestment, then it must look to innovation to grow profits
..or fewer participants in their markets?
Dan, ' It wont take him long before he loses the whole lot back, right down to his last 3p'. I think you are right.
I am sure we have all met a few characters over the years. Hopefully VOD wont take my last 3p but if it did get down to 3p I think I might be betting the house on it LoL
'Telecom providers are better equipped to raise prices than Airlines, look at the recent CPI plus 3.9% price rises'
I guess it different in each 'market' and the timing of any effect is different as each regulator in each market drives for a 'common' agreed definition of cost, ie a WTO definition.
For example, rather than raise prices in India, fierce competition on price has resulted in the Gov taking an investment position to facilitate a new ownership structure. In the end, there is no such thing as 'free' as someone has to pay for it.
So its inevitable there will be 'inefficiencies' in SP pricing. On the other side, the regulator wont allow an inefficient operator to pass on costs to the consumer (citizen) and simply lowering costs to avoid losses ultimately results in an operator exiting a market while more efficient operators will realise profits over regulated prices by investing and or innovating. As a consequence, gains in productive efficiency put pressure on final service prices (and contribute to end user welfare).
I guess if VOD is entering a period of low/ less intense capital reinvestment, then it must look to innovation to grow profits. I suspect the answer is some mix of both investment and innovation on a glide path to lower long run incremental costs... as VOD says in its strategy 'Vodafone is strongly positioned and through 'increased investment', we are taking action now to ensure we play a leadership role and capture the opportunities that these changes create.'
https://investors.vodafone.com/about-us/our-purpose-and-strategy
nobleo, sorry typo, I meant robleo. You are pottery in motion, Upwards though would be better than round & round? Except if you are in the film ghost of course? Then both !!??
Poetry i. Meant, duh
Nice one fleccy, you outdid dan with the potry there, Dan your up next lol
"let's just hope Putin, doesn't put the bootin & spoil the party?"
I can't help but think that routin-tootin Putin won't put the bootin, as the result of lootin & shootin would lead to the World reputin Putin as an imputin warmonger; Plus it would hit him and his mates in their most sensitive area, their wallets.
"The discounted cashflow models they use try to express the time value of money in todays terms and so make estimates about future interest rates, inflation, growth, scientific improvements etc. "
Actually, Telecom providers are better equiped to raise prices than Airlines, look at the recent CPI plus 3.9% price rises.
https://www.which.co.uk/news/2022/01/broadband-annual-price-rises-which-providers-will-hike-costs-the-most-in-2022/
Of course much depends on competition, and Telecom companies will allow customers onto new offers at the end of their current contract. I have a TV & Broadband contract with Sky, and my monthly bill was due to go up to £70 per month at the end of my then contract; I asked for a new contract and now pay £42 a month, for more or less the same service, at least I don't notice the differences.
There are no guarantees Air travel will resume as normal in the long term, businesses may decide to do more via Video Conferencing, and although Tourism Air Travel may see a boost from the lifting of restricions, and current low fares, the enthusiasm may decline as pricing normalises. Telecom services just tick over month after month, with the revenue clocking up with minimal intervention, and mostly guaranteed. Whereas Air Travel might be viewed as a luxury, internet & phone services are a necessity in this age of online banking, shopping, etc, etc.
Some will say i'm biased, due to my background and investments, but no matter how I try and view it, I see Telecoms as a much safer bet than Airlines.
Android. Betfred winner. It wont take him long before he looses the whole lot back, right down to his last 3p... The reason bookies make so much money is because of the gamblers who think they know better than the rest. Without them, the bookies would be out of business. Still good luck, I like a bet myself of course. Vod still on a great run, let's just hope Putin, doesn't put the bootin & spoil the party?
Fleccy, Compound, thanks for very thoughtful structured posts.
The only thing front of my mind why there are inefficiencies in pricing and in particular, the airline industry vs telecoms is methodology. For example, where analysts attribute higher value to £1 receivable in time 1 vs £1 receivable in time 20. The discounted cashflow models they use try to express the time value of money in todays terms and so make estimates about future interest rates, inflation, growth, scientific improvements etc. I suspect the recovery from the pandemic changed some of their assumptions about cash receivable in time 1 where airlines quickly ratchet up whilst telcos have broadly annuitised their returns in line with regulatory controls over a longer regulated time period.
Even with low telco capital reinvestment cycles, the regulator probably would not allow higher returns in time 20 and regulate they are passed on to consumers (citizens) in lower regulated tariffs. I guess a telco could crystallise some of that future value before it is regulated by restructuring now, hence the current bid/ M&A excitement.
"You just need to look for inefficiencies in pricing in both and consistently put your money into those opportunities with a disciplined approach to position size, profit taking and risk management."
Wise words Compound; I always read your posts with interest, and haven't found disagreement with anything you've stated in any of them.
Much depends on investment window, as retail investors we should think in terms of years, not days and months. The professionals need to consistently show profits year on year, so they're time limited on holding paper losses.
Because Covid is so recent, it gives some brilliant examples of irrational pricing between sectors during the pandemic; For example, why were Telecom stocks severely affected along with Airline stocks, and why did some Airline stocks actually outperform Telecom stocks?
https://www.google.com/finance/quote/VOD:LON?sa=X&ved=2ahUKEwj1yduf8fn1AhXDlFwKHcveB8AQ_AUoAXoECAIQAw&window=5Y&comparison=ETR%3ARY4C%2CLON%3ABT.A
The market decided to re-rate Telecom stocks downards, years ago, using competition, and constant cycles of investment into new tech with no return on the investment, as the excuses. I always like to use Ryanair as a comparison to my Telecom holdings, since it's easy to see the differences in market sentiment, and pricing. Ryanair doesn't pay a dividend, so investors are completely dependant on capital gains, with profit/loss entirely determined by when you buy, or sell. On the 5 year chart, linked above, the declines in Vodafone and BT are easy to see, but what's really surprising is the difference in performance during Covid, where Ryanair price outperformed Vodafone by more than 55%, and BT's by even more, which is especially surprising with BT and Vodafone still making profit, whereas Ryanair has lost Billions. The competition and constant investment in new Tech arguments, doesn't just apply to the Telecom sector. Because of concerns around ESG, the Airline industry is under the carbon emission cosh, facing big investment in new planes and carbon offseting. Competion is also a concern for Airlines, with many Airlines competing for the same routes, and Governments in Europe discussing alternatives like high speed train. Why is so much made of the infrastructure investment cycles, in respect of Telecoms, yet no mention of the investment in new planes required by the Airline industry?
My career has been in Telecoms, and I've seen the upgrade cycles and investment in new Network Tech, like the moves from PDH to SDH, and more recently to DWDM and Cloud. I totally disagree with the market argument that Telecoms will constantly require ongoing upgrade cycles, just to stand still. Once the FTTP and 5G upgrades are completed, I don't see any further network evolution for generations. FTTP has enough bandwidth capability to serve everyone's needs, and 5/6G will be more about cell density and coverage, with 6G just being an extension of 5G, not a replacement.
Hi Rovernut,
Okay, I'll have to take your word for it regarding the exact price at which you bought, and as you can see there has now been lengthy discussion here about the effects of consolidations etc since the "good old days". The simple point is that you bought at a very much higher price than the price today, and you're now sadly very much "under water". My sympathies about that. My current holding is also still significantly below the average acquisition cost, but to nothing like the same extent as yours.
All the best,
Mike.
"Rovernut,
Are you on the right share? When was it 280? I've been involved with Vodafone shares on and off for nearly 20 years, and I certainly don't remember it being anywhere near 280. I think the highest was just after it sold its part of Verizon, and that would only be in the low 200s."
Unfortunately yes Mike. It was 320 in June 2000, and I've followed it all the way down.??