Berenberg reinstates Vodafone stock rating at hold with GBP0.80 target

Published 26/06/2025, 12:40
Berenberg reinstates Vodafone stock rating at hold with GBP0.80 target

Investing.com - Berenberg reinstated coverage on Vodafone (LON:VOD) Group (NASDAQ:VOD) with a hold rating and a price target of GBP0.80 on Thursday. The telecom giant, currently trading at $10.37 and near its 52-week high of $10.60, has seen its stock surge over 25% year-to-date.

The research firm cited Vodafone’s complex group structure as a concern, despite the company’s recent sales of its Spanish and Italian assets. Berenberg noted that Vodafone’s largest asset, its German business, has underperformed its market for several quarters.

Vodafone does present some positive aspects, according to Berenberg, as the stock "screens as relatively cheap" on their EV/BIC valuation framework. The firm also highlighted that Vodafone’s merger with ThreeUK is now complete.

The telecom company’s non-European assets, including Vodacom and operations in Turkey, continue to perform strongly, providing some balance to the challenges in its European markets.

Berenberg expects any turnaround in Vodafone’s crucial German business to be at least six months away, which factored into its hold rating decision.

In other recent news, Vodafone and Three UK have completed their merger, creating the largest mobile operator in the UK. The newly formed entity, VodafoneThree, is now the leading mobile operator, with ownership divided between Vodafone, holding a 51% stake, and CK Hutchison, the parent company of Three, holding 49%. Max Taylor, who currently leads Vodafone UK, will head the combined business. The companies have pledged to invest £11 billion over the next ten years, with £1.3 billion earmarked for the first year to enhance their network infrastructure. This merger and investment highlight a significant commitment to improving and expanding mobile network capabilities in the UK.

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