Benchmark raises VEON stock price target to $56, maintains buy rating

On Monday, Benchmark analyst Matt Harrigan updated the financial outlook for VEON Ltd (AS:VON) (NASDAQ:VEON), increasing the price target to $56 from the previous $48, while maintaining a Buy rating for the company’s shares. Currently trading at $45.20, VEON has attracted strong analyst consensus with price targets ranging from $48 to $65. The adjustment reflects Benchmark’s positive view of VEON as a leading mobile operator in frontier markets, now headquartered in Dubai. According to InvestingPro data, the company has demonstrated impressive performance with a 72.22% return over the past year.

Harrigan’s optimism is partly based on the potential positive impact of any interim settlement in the Ukrainian conflict on VEON’s Ukrainian Kyivstar business, which is the company’s second-largest national asset. The analyst believes that despite uncertainties surrounding Vladimir Putin’s long-term actions, Kyivstar will play a crucial role in the reconstruction of Ukraine’s economy. Supporting this positive outlook, VEON maintains an impressive gross profit margin of 87.61%. The Ukrainian government’s support for the rights of international investors, even under challenging conditions, is seen as a critical factor for VEON.

Kyivstar, which is wholly owned by VEON, is estimated to represent approximately 28% of VEON’s asset value, excluding headquarters overhead costs. In January, VEON disclosed its plans to enter a business combination with Cohen Circle Acquisition Corp. (Nasdaq: CCIRU), aiming to indirectly list Kyivstar on the Nasdaq in New York. This move followed the signing of a Letter of Intent with the special purpose acquisition company. InvestingPro analysis suggests VEON is currently undervalued, with additional insights available in the comprehensive Pro Research Report covering this and 1,400+ other top stocks.

Additionally, VEON’s Jazz operation in Pakistan is highlighted as another attractive prospect for a public listing. Harrigan notes Jazz’s dominant position in both the mobile and fintech sectors within the Pakistani market, suggesting further potential for growth and investment interest in VEON’s diversified portfolio. InvestingPro rates VEON’s overall financial health as GREAT, with a score of 3.04, offering investors additional confidence in the company’s operational strength. Subscribers can access 10+ additional ProTips and detailed financial metrics to make more informed investment decisions.

In other recent news, VEON Ltd. reported a significant 9.8% increase in revenue for Q3 2024, reaching $1.036 billion, while its EBITDA saw a slight decline of 1.5% in USD terms. The company’s cash position improved notably, up 80% year-on-year, despite a rise in capital expenditures by 51.2%. VEON is also making strategic moves, including relocating its headquarters to Dubai and transitioning to exclusive trading on NASDAQ. Analysts have shown interest in these developments, particularly in the context of the company’s financial strategy and future bond maturities. Additionally, VEON’s focus on digital services continues to gain traction, now representing 11% of total revenues, with direct digital revenues rising by 40%. The company is optimistic about its future performance, projecting full-year revenue growth of 8-10% in USD and EBITDA growth of 46% in USD. These recent developments reflect VEON’s strategic initiatives and financial maneuvers amidst changing market conditions.

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