@IAmShareCrazy, if Mr Market is crazy enough to give an opportunity to buy VOD at 160p then I’ll do so. I know you are a shorter, so just keep shorting VOD if you like for me please until you shorts come off! (See what I did there!) Good luck to you from the bottom of my heart whatever you do!
@ValueSeeker8 - VOD isn’t the only company that has to include such “accounting necessities” in financial statements. Fact is that total revenue was disappointing last time around and in a couple of months if there’s the same level disappointment then some here will be averaging down all the way to 150 and claiming what a bargain they have.
On top of that… until Brexit uncertainties are eliminated (and how many months longer will that be?) then there’s also risks concerning potential network design issues in moving move data freely between the UK and EU states… which the outgoing CE referred to a number of times… one of those times when Project Fear comes back to bite.
Mr Market has so many mood swings predominantly swayed by fickle sentiment, it’s often not a bad idea to ignore Mr M altogether, unless of course over-leveraged or trading short-term only.
Even since VOD’s last earnings report on 25/7, as recently as 8th August Mr Market valued VOD at 188+ (day highs). Only a few market days later, mindful of weekends & Bank Holiday, Mr M wants us to believe VOD is worth only 164+.
Key thing is avoiding getting too caught up in Mr M’s herd behaviour, unless there are compelling, stock-specific reasons to be concerned. Like you & others, I don’t see that with VOD longer-term.
That’s not to say we can rule out seeing slightly lower ahead. But no doubt we’ve all been in similar places with other stocks before. We know that just as they get overbought, at other times they also get oversold. Market sentiment swings from irrational doom & panic, to no less irrational ebullience. Then back again.
Little question that this will be much higher again later. Only the timeframe remains in doubt. - Regards. Edit: typo.
Traded this share on and off for the last 20 years. Planning to go back in on Monday with a decent stake. Normally I would look for 5% and then close out. Will be looking for at least 10% here. Will be happy to go in again if it falls sharply lower.
@J_Westlock, @jackdawsson, thank you for your comments. I am fully aware that VOD may fall further. And how much it has already fallen particularly in past 3 sessions. The reason for this drop is not the disappointing revenue figure reported on the 25/07 update which was mainly due to having to adopt a different accounting standards and adverse FX. The SP did rise to 188+ as JD kindly pointed out. But now we know it is due to an analyst downgrade first and VOD intention to raise 30 bn Euro in new unsecured notes which was announced by an RNS published at 15:48 yesterday. Such information may have been leaked prior to that, but notice the yesterday’s SP behaviour as depicted below:
No wonder then that VOD SP dropped. However, I am already in VOD and will continue to hold and may even add more (if dividend yield > 8%) as I am reasonably confident of the company’s ability to reward its stakeholders appropriately.
Vodafone triggers six flags, with auditors highlighting risk in the accuracy of revenue recognition. Voda screens for consistent exceptionals use, rising receivables and payables, falling deferred revenue and stretched cash dividend cover. From a research note last year.
And yet the SP continued to rise all the way to 239.65 even during the first week of this year. Isn’t that amazing or crazy? You tell me. We all know that VOD is a growing, large, geographically diversified and exceptional company and we know about the dividend cover as it has been discussed extensively.
Your chart is too small to see and it don’t expand (for me anyway). All I see is a downward trend throughout 2018 and in recent days a nasty drop on Wednesday 29th August… and I very much doubt that the latter drop is caused by yesterday’s RNS being leaked… buy yes, yesterday the SP dropped about 1% in less than an hour around lunchtime but it’s done that plenty of times before esp. on a Friday.
Regarding that… this is why some distrust VOD and their unclear accounting… we will see in November what they have to say about the 6-month figures as they can’t keep using that one.
@J_Westlock, the chart only shows the intraday SP curve for Friday 31/08/2018 from 8am to 4:30 pm which I copied from Google Finance. I don’t know what device you are using to make the chart small and unrecognisable but it shows clearly on my PC screen. I, like you will see the November update, they will of course have to use the new MiFID II (Markets in Financial Instruments Directive II) accounting. If you are interested, Hardman & Co has published an interesting document on the impact of this new regime on the liquidity and valuation of stocks traded on the LSE: http://hardmanandco.com/docs/default-source/newsletters/mifid-ii-monitor---august-2018c48b1843094f6dc8b783ff000066fb4b.pdf The study gives some preliminary findings and acknowledges that it is a bit too early to draw more concrete conclusions.
@IAmShareCrazy, Sorry that I can’t find any earlier data than displayed in my earlier post. VOD to me is a reliable cash cow (which says: moo) and will remain invested for as long as that is the case. So, I don’t care about the ups and downs neither. In fact, the cheaper I could buy VOD the better and wish the dividend yield will get as high as possible as long as it is maintained. I don’t read charts, but do occasionally trade only if I think it is safe to do so.
Hi @NewBill1703, congratulations on your WTB success. Good time to sell perhaps having disposed of their jewel in the crown ?. Just my personal opinion you understand !. I had a similar success with ESUR a couple of weeks back, nice feeling - I sold almost immediately just in case the deal evaporated !.
As ever I remain wary of getting too exposed to VOD (or indeed any other single stock). The new 30 billion euros of debt is a concern, personally I suspect that this is perhaps the major cause of the price drop ? - though god alone knows telcos have plenty of stuff to spend big money on I guess. Not sure about the dividend cover situation, most sites I have looked at don’t show it fully covered - nothing new there though. No other negative news that I’m aware of, and indeed India and Australia news sound pretty positive.
Can only agree with the concept of buy and hold just need to avoid businesses like CLLN which I ditched about 5 years ago [even then cash flow was dreadful] and CNA, should never have bought but finally lost patience and took a loss.
Otherwise I hold through the markets ups and downs. Has served me well with the likes of HSBA, RDSB, GSK etc Just need recovery from VOD, SSE and NG.
Thanks. It’s certainly an approach that has served me well for years with real shares. Experience has taught me that, with exceptions, many stocks recover well after periods of irrational selling, especially when some of the issues seem sector-related & down to less predictable global factors.
Where I slightly differ is in being very glad to book gains after seeing strong rises, or close to L/T resistance levels. Later on, I try to repeat a similar process & so on.
But a number of approaches can be successful in this business, with some methods suiting different individuals more so than others. Always best to stick by what one knows works well for one over time. - Regards.
Good to see a decent debate here. VOD my largest holding : @SP1.67, 10.8% of Portfolio on an XIRR of -14.3%. Not good but I’m holding on like others. The long term strategy of VOD seems sound enough, the short term problem seems to be Awful Price Wars in many Key Markets (IN & AU primarily.) VOD’s response seems to be locally listed entities that VOD.L has a meaningful stake in. The strategy does secrete the debt in a locally listed entity and in a local currency which provides a rational hedge. Turkey and associated problems clearly aren’t helping. Once the whole industry stops-bleeding Vodafone’s global investments, branding and infrastructure will remain. It would be great if VOD.L could emphasis the Value they’re adding to the foreign subsidiaries for all stakeholders. Likewise it does seem that the Vodafone brand has huge potential as a marketing platform. As long as the dividend keeps being paid, no need to panic IMHO. Good Luck All!
With holding a significant stake here now in obvious huge paper loss, so perhaps also with some subliminal bias in favour of seeing eventual recovery, my view of VOD being a firm L/T hold (for me at least) won’t change, even if we go significantly lower.
However, with SP continuing to drop, despite the occasional up day breather, & today seeing a new 52-week intraday low of 162.78 as I write, on balance, it’s only fair to relay that on other financial forums I’ve noticed an increase in the number of technical calls thinking this may revisit close to 155.
As we’ve seen with other charts here, similar levels tested twice in the last 7 years, but not since early 2013. I’m not saying I agree with circa 155 as being likely. More so, as disappointing as it’ll be, we can’t rule it out technically if 160 goes over the coming days. - GLA.