Member Info for KevRow

"The legal papers add that “Vodafone gathered information on state relief that had been awarded to some of the claimants” – and then used its knowledge of the small business grants to reduce the commission payments it was making to franchisees. These actions, the legal papers allege, effectively meant Vodafone took the benefit of government support intended for small businesses."

In specific relation to covid, you'd think the above would be reasonably straight forward to establish. Time will tell if they did anything improper and I'm sure the wider case is much more complicated in terms of apportioning any blame, so might drag on.

It looks like this is gaining traction and doesn't put Vodafone in a good light as it unfolds.

https://www.theguardian.com/business/2025/jan/07/business-secretary-vodafone-covid-corruption-commissioner

"Proposed space launches within next two years could ultimately deliver mobile phone signal even to most remote areas"

https://www.theguardian.com/business/2025/jan/05/amazon-aims-to-branch-into-uk-internet-market-with-satellite-broadband-plan

Https://www.theguardian.com/business/2024/dec/10/vodafone-store-managers-debts-franchise-operators-legal-claim

"A group of 62 of about 150 Vodafone franchise operators – some of whom said they had had suicidal thoughts because of the pressure exerted by the telecoms group – say the resulting personal debts have prompted them to join a £120m-plus legal claim against the company."

What impact would you expect a deal between Vodafone Spain (which has been sold) and Telefonica to have on the share price?

It's one things to be optimistic but a minimum 40% increase based purely on the announcement of the merger being approved (without even knowing any of the conditions attached to the merger approval) is delusional.

A 40% increase would add about £8 billion to the market cap and Vodafone's stake in the new entity isn't project to be worth that much in it's entirety. Vodafone will get 51% of a £15 billion newly merged business worth about £7.5 billion if the new valuation is to be believed.

I'd say a very optimistic increase would be £7.5 billion minus whatever the UK assets are valued at the moment, add that to the market cap, and hope that the market has so much faith in the merger that the value is added purely on the merger being approved.

"Strategic buying and Three merger - target of £1. "

No one knows what the final merger will look like yet, so how can a meaningful value be attached to it?

"if the inquiry group finds no competition concerns, the merger can go ahead as planned

if the inquiry group finds that the merger may be expected to result in a substantial lessening of competition, it will decide how its concerns should be remedied. For example, this can include selling part of the business or prohibiting the merger altogether"

I'd be surprised if the merger is blocked but it could be approved with enough caveats to make it not worth doing or that significantly dilutes the benefits. I'd hope Vodafone don't agree to the merger at any cost and are prepared to walk away if the conditions aren't right.

"Following this decision, the period within which the report on this reference is

to be prepared and published is now 7 December 2024. The Inquiry Group

aims to complete the inquiry as soon as possible. As such, the report may be

published in advance of this date."

https://www.independent.co.uk/business/vodafonethree-ps15bn-merger-delayed-further-as-watchdog-extends-probe-b2590268.html

https://assets.publishing.service.gov.uk/media/66ac9ed249b9c0597fdb09d5/__Notice_of_extension__.pdf

"If that's true Kev then you should immediately fill out your online self assessment tax form, for all this money you're making on your paper gains from unsold shares; Wait a minute, the HMRC only tax gains when you sell stock, looks as though they agree with me."

Yes, which is why there is a distinction between a real and paper loss that no one is disputing. The nature of the loss/gain is different, as one is realised and the other is a moving target but they are still losses/gains. To characterise it any other way is a personal choice.

"When my Lloyds shares were showing a loss of £40,000 last October was I losing money? Now that my Lloyds shares are up £42,000 have I made money without selling?"

Yes to both. A paper loss/gain is still a loss/gain. I can understand rationalising it so that it's only "real" when you sell but that sounds like it's more to do with a personal outlook than reality.

"Will the lack of optimism by some on VOD's future SP one wonders why they don't sell. I get despondent from time to time but I do believe as TGR has pointed that the MC is way undervalued."

24 hours later and with no change in share price.......

"What an awful investment this is. I wonder how many thousands of honest investors have lost their shirts on this dog over the years and it's seemingly not finished yet. Inflicting losses on investors seems to be the only game in town with VOD. 😔"

To be fair, Vodafone would try the patience of a saint!

"At current levels. That is the buyback yield."

Indeed. If the share price stays stable at the current level for the next few years, that's the yield. As the company has had to dispose of assets to raise the money to buy them back, you have fewer shares in a company that's worth less due to the asset disposal.

Obviously no one has a working crystal ball, so it'll be a matter of some time before it's clear if the share buy backs were a good idea or not and that will be based on future business performance (not buybacks) which is also going to take time to become apparent. There are reasons to be optimistic but Vodafone are also facing significant headwinds over the next 12 months i.e. the TV unbundling changes in Germany that have now kicked in etc.

"(€2Billion from a €22Billion market cap in 12 months)"

These figures suggest you don't believe the share price will hit £1 any time soon then?

"€22+ Billion Market cap of which €2Billion is within 12 month at least"

2 billion is 9.1% of 22 billion. As has been discussed at length before, you also end up 2 billion lighter at the end of it. So if the share price has shot up it was a great idea; if the share price has gone sideways it's arguable the money could have been better spent elsewhere; and if it goes down it was a bad idea.

The buybacks are ongoing and won't be completed for quite some time, so any calculations at this stage are guess work, and the future share price will determine if they were even a good idea or not.

I'm more than happy to take lessons and only a fool wouldn't. It's the ones who seem to think they know better than the market, and more often that not, categorically don't that need the lesson most of all.

Time will indeed tell if your wish list will come to pass but it's little more than that.

"As stated. PB ratio 0.37.

At that level you are not just a target for rival telcos. You are a takeover target across the board."

Well it's been at that level for some time now and everyone seems to have resisted the urge so far. Perhaps they don't just rely on one metric.

"See yesterday with the articles on Vodafone Portugal. Someone somewhere wants a part of everything. So why not pick up the whole lot while it trades a PB ratio of 0.37? Easy to do. "

It makes far more sense for any rival telcos to pick up any bits that compliment their existing business rather than buy up the various bits and bobs that make up Vodafone and end up in the same predicament that they currently find themselves in of selling off the bits they can't make work. I'd imaging that any rival big enough to take over the whole thing would find it far from easy due to all the required regulatory approval etc. that they'd need to obtain.

"Where the dividend is now 5.4%. There is an additional buyback yield which improves the EPS and thus reduction in the PE ratio. The company is buying back €4 Billion on a €22+ Billion Market cap of which €2Billion is within 12 month atleast.

Thus In effect the yield is higher than 10% and more like 14.5%.

The mathematics can not be clearer. Market is wrong. £1+. No question."

I'm not sure where the 10% and 14.5% are coming from?

The dividend for this year is €0.045 per share. The share buys backs result in a saving this year to the business by reducing the number of shares receiving €0.045 per share and won't increase the % yield?

"Its clear we will need more and more data to fuel the ever increasing connectedness and I bet AI will boost demand for data to no end. In my view, Vodafone is a growth stock, and one with a tasty dividend. "

Customer data usage has been increasing year on year for many years and will continue to do so for the foreseeable future. Now that unlimited data plans, or data plans with very high allowances and a flat fee are common place, if I use increasing amounts of data, it most likely represents an increase in cost with no increase in profit.