Is it Vodafone or is it LSE2 Dec 2023 00:02
There are a lot of people slating Vodafone, but any company that can generate more than £3Bn FCF must have something going for it.
So is the drop in VOD price due to the company performance or due to major cash outflow from the a London exchanges? Several companies are using outflow as a reason for their poor share price performance this last 12 months. Some are taking action and either dual listing or looking at changing listing location.
The reasons behind the outflow are not clear, but possible candidates include overall higher tax burdens, Brexit and trading barriers, overall state of UK economy, inevitable Labour next election win, dire Tory mismanagement of the economy, or just that there are better prospects elsewhere than in the exchanges of our sometimes tawdry little island. Whatever the reason the babies are going out with the bathwater with PEs in lownsingle figures, double digit yields and ROCE promises in the 20s and above.
The outflow of cash on the London exchanges is significant enough to have gathered a momentum of its own. A few lifeboat companies are still doing OK, UK money has to go somewhere, but those with any questions over debt, earnings, market position or just general mood music are being punished.
Would VOD be rated higher if it was listed in NY, on the NASDAQ or elsewhere?