Wednesday, January 19

Telefónica loses sexapil. Vodafone will stand out on the stock market

‘Telefónica’s seized share: from 9.3 to 3.8 euros in 6 years’This is how the magazine Inversión titled one of its reports from the 15-page special of the magazine’s issue entitled How can Telefónica grow?

The drop in value corresponds to the time in which Jose Maria Alvarez-Pallete leads to the controls of the teleco and doubts about the evolution of the share persist and the potential for revaluation suffers compared to that offered by its peers in the Old Continent.

The stock is still lower after extensive investment analysis, which was well received by the financial community, and the titles now move about 3.5 euros.

The market consensus throws an average target price above 4 euros, a level that would open the doors of heaven for Pallete regarding the share, by raising it to 4.55 euros for one year.

The price translates to an average potential of 20 percent, but far from the juicy returns that are appreciated among European pairs.

Vodafone has the greatest potential

Vodafone offers a return for the next 12 months of 50 percent, the highest in the industry. The securities trade around 109 pounds and can go up to 164.86 pounds, according to the consensus compiled by Bloomberg.

Deutsche Telekom has a potential of revaluation for the same period of 45 percent at trading above 15.4 euros with an average target price of 22.49 euros.

Orange point to some rises greater than 30 percent at 12 months, while it is trading at 9 euros with an average target price of 12.06 euros based on the estimates of each consensus expert.

The price of Telecom Italia is conditioned by the takeover bid presented by the venture capital fund KKR over 100 percent of the company, distorting expert ratings.

Telecom Italia lives convulsive moments. The Government has not yet ruled on the matter, although it has advanced that the company is “strategic”, which could make the operation difficult, and the CEO has just resigned.

Reuters advanced that Luigi Gubitosi he was leaving office due to the situation after the takeover, something that would be to the liking of Vivendi, the first shareholder of the teleco. Pietro Labriola, adviser TIM Brazil delegate, is the substitute.

The current potential for Telecom Italia is negative, at -5 percent, after exceeding the average target price of 0.47 percent thanks to the rise recorded with the announcement of the takeover bid and which led the value to an annual rise of 20 percent, which it maintains.

Telefónica, the highest increase in the year

Telefónica does stand out compared to its competitors in stock market performance, leaving aside the situation of Telecom Italia.

The titles of the Spanish company advance about 15 percent so far this year in the IBEX 35, although their revaluation is flat in the accumulated of the last 12 months.

Deutsche Telekom rises in the DAX German by about 5 percent so far in 2021 and earnings are up less than that percentage over the past 12 months.

Vodafone falls 5 percent since January in the British FTSE 100 and the decline rises to 10 percent from a year ago.

Orange loses in the Euronext French slightly more than 5 percent since the beginning of the year, a decrease that grows to more than 10 percent in the accumulated 12 months.

Deutsche Telekom leads the boards

Telefónica’s stock market performance is superior, but the market consensus valuations are lower compared to the rest of European telecoms.

The market consensus is divided with Pallete’s company and the “buy” and “hold” recommendations have the same followers, 42.9 percent. The rest, 14.3 percent, urged to “sell” the titles.

On the other hand, Deutsche Telekom does not register any recommendation to “sell” and 88.5 percent of the experts choose to “buy” shares of the German company for 11.5 percent who prefer to “keep” the positions in the portfolio.

The advice to “buy” is higher in Vodafone, 92 percent, but it does have recommendations to “sell”, 4 percent, the same percentage to “keep”.

58.6 percent of experts prefer to “buy” shares of Orange, by 34.5 percent who advise “keep” and 6.9 percent who urge “sell”.

The consensus calls for “maintaining” the positions in Telecom Italia, 63.6 percent, and does not record recommendations to “sell” as the remaining 36.4 percent choose to “buy.”