Vodafone

[moorfield]

The Human Condition - that painting of a painting (ie. IT) in front of a window (ie. HYP) - was one of Magritte's also!

https://en.wikipedia.org/wiki/The_Human ... _(Magritte)

[Arborbridge]

"This is not a HYP! * "

monabri 2019


(*) it also has ITs ......

"This is not a HYP comment": but anyone interested in this subject to look at #thisisnotapipe on instagram, where there are 5467 images, many of which are quite witty, paying homage to the original. I even have one of my own on there, although you would never find it!

Nuff said from me on this OT subject.

Arb.

[strowger]

The yield is ridiculous and clearly signalling trouble.

However, we can be pretty sure the dividend will not be cut this year. The new chief exec has firmly committed himself to it (I'm not allowed to post links but if you look: news.sky.com/story/vodafone-dials-in-dividend-despite-cut-pressure-11553419), so, if it's unsustainable, he will sustain it until it has well and truly buggered the company.

Vittorio Colao was a rounded and widely-experienced business person; he created value through buying and selling businesses. Nick Read is an accountant; he will create the appearance of value through finding creative ways to add debt and disguise the fact that debt is present. The hiving-off of the hosting business announced this week (with accompanying liabilities due to IBM) is an example of this, as is the hiving-off of the cellsites (towers) which he has talked about before.

I don't necessarily think either of these decisions are terrible, FWIW. The hosting business was terrible and needed a total change of strategy. The markets have long undervalued Vodafone's assets so the hiving-off of cellsites might help them be valued appropriately. But it IS more debt once they're gone and a liability to the new owner is created.

[Arborbridge]

The yield is ridiculous and clearly signalling trouble.

The trouble is, that that statement could apply to many companies at present, so what are we to do? - except sit back and wait? From my own HYP, these are all of similarly high yield (over 8%):

CNA
BAT
SLA
PSN
AV.
IMB
BHP

All to be written off because they have a ridiculous yield? Indeed, one might say the the whole market has a ridiculous yield at present, which in former times would be pointed out as a buying opportinity - except that this time there isn't a low P/e to go with it.

Arb.

[jackdaww]

The yield is ridiculous and clearly signalling trouble.

The trouble is, that that statement could apply to many companies at present, so what are we to do? - except sit back and wait? From my own HYP, these are all of similarly high yield (over 8%):

CNA
BAT
SLA
PSN
AV.
IMB
BHP

All to be written off because they have a ridiculous yield? Indeed, one might say the the whole market has a ridiculous yield at present, which in former times would be pointed out as a buying opportinity - except that this time there isn't a low P/e to go with it.

Arb.

================================

certainly not written off , the risks may never happen , on the contrary .

its quite easy to point out flaws and risks with most of these HYP candidates.

that is why they are high yielders - they carry high risk.

[Dod101]

I only hold the two tobaccos from Arb's list, and I think their yield can be explained as can at least some of the others, although I do not much like many of the others for various reasons. I think we need to take the yield as an indicator, not necessarily a reason in itself to reject a particular share. jackdaaw is right, just be on our guard

Dod

[idpickering]

I hold all of Arb's list, save for Centrica. I get that they might be perceived as being of higher risk, but as they're amongst other holdings in my 32 share HYP, it's a risk I'm ok with.

Ian.

[Arborbridge]

================================

certainly not written off , the risks may never happen , on the contrary .

its quite easy to point out flaws and risks with most of these HYP candidates.

that is why they are high yielders - they carry high risk.

Exactly. I've always pointed out that high yield is a risky strategy - the best way to work it is to be in it for the long run with a widely diverse portfolio.
It's easy to point out flaws in most high yield candidates, as you say, so we rely on the "portfolio effect" as our "backstop" to come to our aid.


Arb

[moorfield]

It's easy to point out flaws in most high yield candidates, as you say, so we rely on the "portfolio effect" as our "backstop" to come to our aid.

Indeed. I hold CNA and VOD which have both been bouncing around 2 * FTSE100 yield for the last year or so. I've dealt with this by simply ignoring them, and reinvesting dividend income elsewhere. Meanwhile, overall portfolio income is trucking along nicely thank you.

[IanTHughes]

The [Vodafone PLC] yield is ridiculous and clearly signalling trouble.

I do not know what you mean by ridiculous but the only signal I am getting is that Investors are fearful with regard to the prospects for Vodafone PLC (VOD). They are therefore demanding a higher return, as indicated by the setting of a low price / high yield. I do not see a "clear indication" of trouble ahead as the Investor fearfulness may well turn out to be unjustified.


Ian

[moorfield]

I do not see a "clear indication" of trouble ahead as the Investor fearfulness may well turn out to be unjustified.

Well we'll find out on Friday if Dod's dither-tinker was prescient or not. No doubt another VOD thread will be appearing at 7.01am on the day.

[monabri]

"IBM and Vodafone have partnered to launch a new venture aimed at boosting European 5G, artificial intelligence (AI) and cloud capabilities."

"The deal will help bolster Vodafone’s revenue as it competes against other large mobiles companies across Europe"


https://www.softwaretestingnews.co.uk/1 ... g-venture/

[Dod101]

Well we'll find out on Friday if Dod's dither-tinker was prescient or not. No doubt another VOD thread will be appearing at 7.01am on the day.

Friday is only a Trading Statement and could include a profits warning but I doubt unless the sky has fallen in, that they will say anything about the dividend. I do not of course mind either way because having sold I feel better and if the results are good then that is good for continuing holders.

Dod

[88V8]

I do hold some of Arb's list, but what distinguishes VOD for me is the degree of divi uncoveredness.
When hard times come down the pipe, those with the least cover will surely cut the most?

V8

[Arborbridge]

I do hold some of Arb's list, but what distinguishes VOD for me is the degree of divi uncoveredness.
When hard times come down the pipe, those with the least cover will surely cut the most?

V8

Yes, this lingering uncovered-ness happened after they got out of Verizon, and I thought it might be some sort of acccounting artefact which might unwind. It's the main reason I've rarely topped up VOD since then - though I did weaken last year. I'm perplexed about the whole outfit, - caught between selling off because it is all rather suspicious, and leaving it be as it's a huge company which will surely find its way forward - and that is what HYPers do. i.e. trust the management since they know more than we do.

Arb.