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144 or 125 makes no difference to me if I am not selling. Feb cash div plus June ex div to offset. Market is cannibalising divs to offset no interest over the last 18 months or so...Draghi says we have to wait another 9 months before interest rises

GLA

Hi Jack,
Yes I agree. As ever we will only know with certainty in hindsight.

The macro environment goes through a freeze unfreeze cycle. We are currently in a freeze.

But there are opportunties in the pipeline. Political and economic consensus in europe plus a good deal with Germany will make a big difference.

I bought more Vod yesterday morning on the strength of the div income and remodelled my portfolio over 15 years vs purchasing an equivalent annuity. Cheered me up.

Best of luck

Thank you Jack

While the IG chart shows price is well below the 200 MA, the 20, 50 and 100 may indicate a change in direction in the chart below.

https://www.marketscreener.com/VODAFONE-GROUP-15867071/charts/

I agree profitable customers (strategic balanced scorecards etc)

In the move to next gen tech, existing customer profitability subsidises the acquisition of new customers and all customers migrate to the new product economics such as AI.

Without product revenue/customer growth, a company will exit the (regulated) market

The regulated elements of Vod track to GDP and interest rates.
The unregulated parts track to customer acquisition and retention numbers.
One off initiatives underpin the freecash flow/ valuation.

Will be good if acquisition and retention numbers are up tomorrow

Waiting for clearance.
Politically and economically Germany is up for it. Competition remedies to be determined eg sell a Vod asset
http://ec.europa.eu/competition/elojade/isef/case_details.cfm?proc_code=2_M_8864

Go figure, RBC gave a target of 125 on Vod and 3000 on Metro...

Vod must be the best current example of the repricing of risk between equities and bonds. Both prices decline at the prospect of interest rate rises. However Vod pays 8%+ div for higher risk of holding an equity (including compensation for capital erosion)
Not much difference between the 2 asset classes respective capital values! But both imo give a better (riskier) return than buying an annuity while interest rates are low and to hold (live..) for 33 years to get your money back.....holding cash does that if you are disciplined :-)
Next week Draghi will give a hint when the QE reinvestment proceeds in fixed interest securities will be offset by interest rate rises. The recent Vod zero rate bond auction gave 50:50 results on risk between the 2 asset classes. Draghi may tip the balance and imo Vod will move higher. I think balance sheet qe unwind in US is rationalising (macro) liquidity flows that underpin US/ EU technology trade deals. EU in turn require real economy companies like Vod who have an 'EU technology footprint' to underpin a pan EU trade deal that can be monetised in real world domestic economies like Germany in need of next generation technology investment.

It all takes time, but Vod Q3 update is due shortly, our interim div is paid on 1st Feb for our pains ;-), a good H2 outlook and Liberty deal on the horizon, and DT broker forecast (and others) over £2...
Vod is an investment not a day trade. If a recession is coming, value will prevail and will be underpinned by well regulated EU markets.

The era of creative destruction/ disruption now needs to be monetised against the wider economic issues of zombie companies and non performing loans.

IMO Vod has a portfolio of assets that does and will perform.

Maybe the conditions for Vod UK ipo or sale to Hutch

Organic service revenue growth reported in H1
•Europe consumer fixed and mobile
•Emerging market consumer
•Vodafone Business segment

Perfect. Macquarie look like they erred forgetting the Cloud is not just physical infrastructure Good for Vod

Here is the link
https://www.ecb.europa.eu/mopo/implement/omt/html/index.en.html

Although the EU stopped purchasing assets under QE last month, we are now in the reinvestment phase of that programme ie as securities purchased come to maturity, they will be reinvested in the 'secondary markets or real economy' of EU participants. In January this is c€51Bn - see table in the link below.

Reinvestment in secondary markets 'avoids issues of integrity and transparency' in the transfer process ie money transfer disproportionately to the asset rich, not the general EU population ;-)

Would RBS and Macquarie revise their Vod SP targets up if interest rates rise?

IMO, if Vod SP is (negatively) correlated with the reinvestment programme timings, from the table, we could see the SP rise gradually from Feb through to a May peak c 170p, around the time of the Liberty deal and going ex div 1st week June

Happy days are here again

Q3 results - 25 Jan
Interim dividend paid - 1 Feb
Prelim FY results - 14 May

...the final div is not 100% until it is 'declared' [c.June 2019] but NR said it would be paid but not increase with inflation etc.

The BoD ambition to return to div growth per share is dependent on future performance, however they have given 'confident' forward guidance on FCF and sustainable div policy.

Attached H1 transcript and presentation with specific div reference on pages 3 and 9 of the transript and FCF objectives in the presentation.

https://www.vodafone.com/content/index/investors.html

A good update on Q3 performance and outlook required from NR .

This is the PR summary from H1 update

Highlights
• Group revenue of €21.8 billion and loss for the financial period of €7.8 billion, primarily due to a loss on the disposal of Vodafone India (following the completion of the merger with Idea Cellular) and impairments
• Organic service revenue (excluding handset financing, IAS 18 basis) up 0.8%** and Q2 up 0.5%** with good commercial and financial performance in most markets offset by increased competition in Italy and Spain
• Growth drivers: good momentum in fixed broadband (384,000 net adds) and convergence (616,000 net adds); Vodafone Business grew 1.0%*, led by strong growth in IoT; Emerging Consumer up 7.4%* driven by data growth
• Organic adjusted EBITDA up 2.9%** (excluding handset financing and settlements, IAS 18 basis), supported by a third consecutive year of net reduction in operating expenses
• Updating full year guidance: underlying organic adjusted EBITDA growth narrowed to c.3% (previously 1-5%); Free cash flow (pre-spectrum) raised to c.€5.4 billion (previously ‘at least €5.2 billion’)
• Stable interim dividend per share of 4.84 eurocents; full year dividend per share expected to be in-line with FY18

https://www.vodafone.com/content/index/investors.html

This is what NR said at the September Goldman webcast. Regarding the Liberty deal and 2 meetings with the EU Commission ..'the transaction plays into the agenda of the commission, wanting to build champions, infrastructure builders, people that will take the digital agenda forward for Europe'...so Macquarie broker forecast is at odds with this statement and we could do with some clarification!!

https://www.vodafone.com/content/index/investors/investor_information/presentations.html

I topped up today with this months dividend income. Market yield % is nonsense since QT(QE) started in US. IMO EU will tighten fiscal policies and maintain 'accommodative interest rates' until trade deals are in place.

My capital account is depressing but I am not selling/ rebalancing until price is >180p

Thanks Drift/ LTI,

I agree 5G is different. In addition to new products, revenue streams etc, it is also a material move toward a single platform with material cost efficiency...

The link below gives an idea how the EU is thinking. The paper... 'aims to help the Body of European Regulators for Electronic Communications (berec) improve its understanding of 5G in terms of the key technologies and services that may emerge, and the obstacles and enablers for success, with a focus on the near term, specifically the time period from 2018-2022. In particular, BEREC would like to understand the implications of 5G for market structure, market dynamics and competition in the telecommunications market and other related markets'...

https://berec.europa.eu/eng/document_register/subject_matter/berec/reports/8008-study-on-implications-of-5g-deployment-on-future-business-models

I agree the German economy is slowing. Vod is proposing the Liberty deal with its significant capital investment going forward and is positioned against the ECB interest rates/ Bond stasis, preserves jobs and stops Germany falling behind technologically. Vod (and O2) have invested hugely in capex and in German jobs to date, so I suspect that counts for something in the final analysis. Poorer performance in Spain is being offset with job cuts to preserve cashflow (including the Div).

RBC/Soc G..I remember Vod when it was 80p and the debate was is it a utility or a growth company? BT is in the same boat and it will be be 2020 before their P&Ls materially show the revenue growth from data/ iptv that will lead to broker reating from RBC... Most of the impact from the price caps creating the marginal revenue = marginal cost stasis is passed and the new revenue streams are already showing. In the meantime, IMO Vod will continue to pay a div and longterm capital preservation with a new CEO/ experienced Vod employee/ financial engineer at the helm.

Facebook pays Vod for access to its network (access to Vod customers) and is why Vod customers can access facebook content while on their country estates far from the madding crowd or travelling on a red London bus. So facebook indirectly shares its revenues with Vod.

In EU markets, a citizens right to privacy and welfare is ranked highly and heavily regulated. It will be interesting to see the German 5G auction play out. I assume Google/ Facebook et al (if they bid for 5G) will need to meet the same requirements as existing operators and currently subject to legal action/ 5G auction rules definition.

Germany rigorously maintain domestic data warehousing borders, so Facebook will create incremental taxable revenues. EU has recently set a record fine for Google over similar business economics and the general media narrative is that the FANGS pay little tax as it is

In the 3G German auction, high frequencies were not highly valued but 900Mhz was because of the ability of signals to pass through walls etc providing a better citizen/ consumer experience. 5G should increase the consumer experience. it wont create more citizens.. but Vod may attract more traffic/ consumers to its network if Vod/Liberty goes through..

Vod has a strong regulatory governance framework and 30 years cumulative competitive advantage. NR is a commercial exec with some talented 1st reports eg UK turn around etc.

Everything to play for..

EU employment (redundancy) regulations are fairly onerous unlike UK where you can hire and fire relatively easily.

Interesting how this plays out in Brexit as it relates to Vodafones ambition in EU countries and pan european