Vodafone - 5 year low

[OLTB]

Afternoon all

I'm thinking this might be a good time to capture some future income - VOD is below the average value of my HYP holdings and a quick search on the HL charting tool shows that VOD is at a five year low.

The chart also shows that it tends to 'see-saw' in value and it just may be an opportune time.

Cheers, OLTB.

[OLTB]

Afternoon all

I'm thinking this might be a good time to capture some future income - VOD is below the average value of my HYP holdings and a quick search on the HL charting tool shows that VOD is at a five year low.

The chart also shows that it tends to 'see-saw' in value and it just may be an opportune time.

Cheers, OLTB.

I had twitchy fingers and bought some...

Cheers, OLTB.

[Gilgongo]

I too am mulling Vodafone.

The only thing that makes me reluctant is the very high dividend (and thin cover). However, I've had them for almost 10 years now and they're contributing almost 6% to the dividends from my portfolio. So if they did cut I would have had a decent run for my money.

[Arborbridge]

I too am mulling Vodafone.

The only thing that makes me reluctant is the very high dividend (and thin cover). However, I've had them for almost 10 years now and they're contributing almost 6% to the dividends from my portfolio. So if they did cut I would have had a decent run for my money.

I don't know if you are living on the proceeds of your HYP, but supposing that 6% of income were reduced to 3% - how would you feel? It might not be a disaster, but it might make you feel that in future you would rather not be so reliant on one share for such a large percentage.

Just a thought, based on how I felt when BP "went down". Which is why I have a soft limit of 4% and firm cut off at 5%.


Arb.

[carioca]

I have been looking for ideas on what to buy when I get rid of the only unit trust I still hold. Vodafone was one of the options I looked at and decided to ignore. That does not mean that others can't buy and profit from the shares.

For me the main drawback is that Vodafone today is not the same company it was five years ago. Frankly, I don't think I know where Vodafone is today, and even less where it is going. Therefore, the fact that it is at a 5 year low has little relevance, just like any other comparison over this time frame.

[OLTB]

I have been looking for ideas on what to buy when I get rid of the only unit trust I still hold. Vodafone was one of the options I looked at and decided to ignore. That does not mean that others can't buy and profit from the shares.

For me the main drawback is that Vodafone today is not the same company it was five years ago. Frankly, I don't think I know where Vodafone is today, and even less where it is going. Therefore, the fact that it is at a 5 year low has little relevance, just like any other comparison over this time frame.

Fair point - I've increased my holding because it's below average value of my HYP holdings and has a decent yield. The 5 year reference doesn't come into significance when discussing a HYP apart from the time frame of a share's increasing dividend record.

Cheers, OLTB.

[Arborbridge]

For me the main drawback is that Vodafone today is not the same company it was five years ago. Frankly, I don't think I know where Vodafone is today, and even less where it is going. Therefore, the fact that it is at a 5 year low has little relevance, just like any other comparison over this time frame.

I thought you were going to say something to the effect: "the five year low is relevant because it shows the markets doesn't know where Vodafone is going either" I would have thought that was the "therefore" conclusion.

Arb.

PS I'm not sure I ever knew were Vod was going, except that it keeps churning out dividends. In fact, do we truly know where any company is going? I doubt it.

[idpickering]

Vodafone for me have become virtually bond-like. They amount to 3.5% in capital value of my 32 share HYP, and I have pumped my second largest amount of cash into buying their shares, and I'm in no mind to further my bet on VOD by buying even more. Apart from the dividends received, a disappointing investment tbh. A hold for me.

Ian.

[Arborbridge]

Apart from the dividends received,
Ian.

[moorfield]

Surely here on HYP Practical this thread should be called

Vodafone - 5 year high

[idpickering]

Surely here on HYP Practical this thread should be called

Vodafone - 5 year high

Very funny Moorfield. but probably right.

Ian.

[Walrus]

2.5 percent of my HYP. Hopefully it doesn't 'recover before I have enough readies for another chunk . 4 percent is my self imposed limit.

[YeeWo]

Vodafone is now circa 11% of my portfolio, I’ve been loading up this year as the SP’s fallen. I won’t be adding any more, will enjoy the dividends and will trim aggressively when/and/or if the SP recovers to 250p-ish (this FWIW is the Broker Consensus’ SP forecast for the business). Time will tell........

[idpickering]

Vodafone is now circa 11% of my portfolio, I’ve been loading up this year as the SP’s fallen. I won’t be adding any more, will enjoy the dividends and will trim aggressively when/and/or if the SP recovers to 250p-ish (this FWIW is the Broker Consensus’ SP forecast for the business). Time will tell........

Very brave YeeWo, if I may say. Can I ask how many shares you hold? My limits are no more than 5% per share, and 10% per sector.

Ian.

[OLTB]

Vodafone is now circa 11% of my portfolio, I’ve been loading up this year as the SP’s fallen. I won’t be adding any more, will enjoy the dividends and will trim aggressively when/and/or if the SP recovers to 250p-ish (this FWIW is the Broker Consensus’ SP forecast for the business). Time will tell........

Thanks YeeWo

I don't know if you're in the 'building' or 'drawing' phase - I'm in the building phase and if the share price did rise to (say) 250p as you mention above, I would choose to top up other constituents from capital/built up dividends rather than trim VOD as hopefully it will still be paying the dividends bought from the shares at the current low price.

As Ian mentions, 11% is a high percentage of a portfolio and my HYP tends to average out at about 6% per constituent. This is probably why you would wish to trim!

Cheers, OLTB.

[monabri]

Vodafone is now circa 11% of my portfolio, I’ve been loading up this year as the SP’s fallen. I won’t be adding any more, will enjoy the dividends and will trim aggressively when/and/or if the SP recovers to 250p-ish (this FWIW is the Broker Consensus’ SP forecast for the business). Time will tell........

At 11% of your p/f I'd say that it not strict HYP but is erring towards a calculated gamble. However, is it a " bad thing"? If we take recent examples of the big megacaps such as RDSB, GSK...how I wish I could go back in time and snap them up when their yield was very shiny!

Is the time to buy "now" or when there is poor sentiment? ( I'm confining this to companies with a market cap of say £20 billion +). Maybe one should consider going a little overboard when the yield is right?

11% of a p/f on companies at the lower end of the ftse100 is " brave/ reckless" - VOD, however, is at the top end of the ftse100. Does one see VOD going under anytime soon? ( I actually think they will recover ...and the yield will decrease )

Itsallaguess as itsallaguess will no doubt tell you!

.p.s. brokers disagree and can change their mind on a whim ( to suit themselves!).

[Gengulphus]

At 11% of your p/f I'd say that it not strict HYP but is erring towards a calculated gamble. However, is it a " bad thing"? If we take recent examples of the big megacaps such as RDSB, GSK...how I wish I could go back in time and snap them up when their yield was very shiny!

And people who thought that about Lloyds or RBS in 2007 and early 2008 wish they hadn't! Likewise FirstGroup in 2011 and 2012, and quite a few other examples...

That's what makes it a gamble. Being a calculated gamble only makes it better to the extent that one's calculations are correct - and at least the vast majority of investors will run into a case where they're wrong sooner or later. So especially in a long-term strategy like HYP, make certain it won't be too painful when it happens.

Gengulphus

[idpickering]

Well said Gengulphus. Have a rec sir.

Ian.

[moorfield]

Vodafone is now circa 11% of my portfolio, I’ve been loading up this year as the SP’s fallen.

At 11% of your p/f I'd say that it not strict HYP but is erring towards a calculated gamble.

Well pyad's HYP1 (https://lemonfool.co.uk/viewtopic.php?f=15&t=8409) holds BATS (20% of income, 25% of capital) and PSN (19% and 16%). Unless you are a medianic tinkerer, I don't think HYP places any upper % limit on any holdings once bought does it? For me Vodafone currently accounts for 6.7% capital and 10.0% of income overall. At my limit currently, but which I'm quite comfortable with. As a builder for at least the next 12-15 years, I can reduce that weight simply by topping up other holdings over time.

[idpickering]

Well pyad's HYP1 (https://lemonfool.co.uk/viewtopic.php?f=15&t=8409) holds BATS (20% of income, 25% of capital) and PSN (19% and 16%). Unless you are a medianic tinkerer, I don't think HYP places any upper % limit on any holdings once bought does it? For me Vodafone currently accounts for 6.7% capital and 10.0% of income overall. At my limit currently, but which I'm quite comfortable with. As a builder for at least the next 12-15 years, I can reduce that weight simply by topping up other holdings over time.

Good point moorfield. I don't recall anything other than Stephen advising an equally weighted HYP at time of purchase. I guess Doris may end up with an unbalanced HYP in the future, due to market movements etc, and any over-weighting wouldn't bother her anyway. Much like letting your winners run. Maybe we could learn from her and not over think things? Less is more and all that.

Ian.