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Investing.com - BofA Securities initiated coverage on Telecom Plus Plc. (LON:TEP) with a Buy rating and a price target of GBP21.23.
The research firm described Telecom Plus as a "high-quality business" with a 2025E return on invested capital (ROIC) of 19.7%, which is expected to rise to 22% in 2026E and reach 26% by 2030E.
BofA highlighted the company’s free cash conversion of above 90% and an "attractive c.6% dividend yield," noting that customer growth acceleration appears sustainable with acquisitions providing an additional growth avenue.
The firm pointed to operational leverage as a source of further upside potential and observed that Telecom Plus generates approximately 45% EBITDA margins as a consumer platform-focused business.
BofA’s base case projects a 2025-30E EBITDA compound annual growth rate of 9%, with a potential total shareholder return of 32% based on their 2123p discounted cash flow valuation.
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