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Of course, one of the most bearish titles out there at the moment are those that correspond to Telefónica. They have visualized how in a few months the price of their shares has gone from almost 8 euros per share to worth less than 5 euros. In other words, it has suffered a depreciation of more than 30% to the despair of its shareholders. Under a downtrend that was not remembered in a long time. Where the sales pressure has been imposed with particular clarity on the buyer. And what is worse, with a volume of recruitment that must be classified as quite acceptable.
At this time, very few small and medium investors trust national telecommunications par excellence. And that is why they prefer other options to make their savings profitable with greater guarantees of success in setting prices. As an example, in the electricity companies that are exercising safe haven values in the scenario of greater volatility in the equity markets. To the point that some analysts in the financial markets believe that the securities of the teleco may rise to the level of 5 euros per share from now on.
A scenario that possibly does not invite you to take positions in the value. If not, on the contrary, it is advisable to wait until the first signs of training of a soil can be given. From where it manages to retreat in the medium and long term and that can present a very attractive revaluation potential for the interests of small and medium investors. On the other hand, it hopes to buy its shares with prices that are more adjusted than those presented by the company at the moment. When a few years ago I was still testing the levels at ten euros per share.
Telefónica: dividend increase
However, the positive side of this conduct by Telefónica in the equity markets is that its dividend yield is now higher than before the summer. With an interest that offers around 7% and one of the highest of the values that make up the selective index of Spanish equities. Even ahead of the values of the electricity sector, which has traditionally led this ranking in recent decades. This is a curious effect that has caused the company's shares to fall and in such a way that savers are its main beneficiaries.
Telefónica pays each year 0.40 euros as a dividend through a fixed charge, which is guaranteed divided into two installments of 0.20 euros each. From this dynamic, a person who invests his savings at 5.80 euros per share will have an estimated dividend of 4,000 euros per year and after deducting taxes. In other words, you will have a monthly income each year very close to 350 euros. Anyway, well above what banking products and fixed income derivatives offer today. In other words, form a portfolio of fixed income within the variable. Whatever happens in the stock markets.
Sorry for the debt and Latin America
Sea cual sea el caso, los últimos resultados de la empresa no han sido del todo malos, pero por otra parte, muy mal acogidos por los mercados financieros. Donde, Telefónica cerró el primer semestre del año con un beneficio de 1.787 millones de euros, lo que supone una mejora del 2,8% respecto al mismo periodo del año anterior. Es evidente que el buen comportamiento del negocio en España, Reino Unido y Alemania compensa las caídas registradas en Brasil y Argentina. Pero algunas de sus líneas de negocio siguen creando muchas dudas entre los pequeños y medianos inversores.
While, on the other hand, the true Achilles heel of national telecommunications is its high debt, which is very frowned upon by financial analysts. Among other reasons, because it can overload your business accounts during the next few quarters. Where one of the solutions you have at hand to reduce it is to lower the dividend yield. And this is a fact that financial agents do not like, since if it occurs it would generate a new downward escalation in their prices. To the point that this is going to be one of the keys to the future of the telecommunications company in the coming years. And what is worse, with a volume of recruitment that must be classified as quite acceptable.
Soccer League Rights
Movistar has renewed for the following season the broadcasting rights in Horecas (hotels, restaurants and cafeterias) of the football content of Santander League, the Champions League and the Europa League, so that customers of the premises that have Movistar + can enjoy the most complete sports offer on television. But it is not clear that this procedure is profitable for the interests of telecommunications and there are even doubts that the contract can be renewed in the coming years. It is another of the factors that come to clarify the sharp fall in prices in recent weeks or even months.
De todos modos, los derechos de retransmisión de partidos de fútbol pueden ir en contra de los intereses de esta compañía cotizada. Hasta que scope niveles más bajos de los que se comercializan hoy en día. A tal efecto, es preferible esperar lo que suceda con el emission rights happens to make a choice. Or to open positions or, on the contrary, to forget about the value for a very long period of time and not have more than one obstacle with the price of its shares. Even though there are many financial intermediaries who think that their prices are very cheap at the moment. Or at least they are very well adjusted.
Discounts on your products
All this despite the fact that users of the telecommunications company will benefit from additional discounts up to 150 euros in high-end smartphones, and all Apple Watch can be financed without interest with six months of free multiSim. At the same time, BuyBack is the service through which the company from now on will buy customers their old device when they buy a new one. A piece of news that may not have traded higher in the equity markets. If not, on the contrary, it has been neutral within a clear bearish context in the medium and short term.
Whatever the case, bad times are ahead for investment in the coming years as a result of the opportunity for its price to approach levels close to 5 euros per share. Beyond other series of technical considerations and perhaps also from the point of view of its fundamental principles.
Leader in fiber optics
In Spain, there are already more than six million households that are using Telefónica's fiber optics to receive their connectivity services, which represents an increase of more than 24% compared to the same period of the previous year. This growth in the number of households that access its services through the Telefónica network is reflected in its optimization, since the use of the operator's fiber reached 27% of the total in June, a percentage higher by 3 points than in June of 2018.
To this end, Telefónica has the largest fiber optic network to the home in Europe and continues to undertake an ambitious deployment plan with the aspiration of reaching comprehensive fiber coverage by 2025. As of today, the operator has already covered with fiber the 70% of the national territory. As of June 30, the number of Real Estate Units passed by fiber reached 22.2 million, an increase of almost 10%. In connection with June of last year, two million new homes that have the network at their disposal. This represents more than 2 or 3 of the total of Real Estate Units.
With customers' 68%
Of the more than six million households that use Telefónica's fiber, 4.15 million are Movistar customers, which represents 68% of those who use BAF, and the rest, 1.86 million, are wholesale customers that access the network through another operator. Both groups of clients have experienced sustained growth in recent years. If we compare it with the previous year, as of June 2019, Movistar clients have grown more than 13% while wholesale clients have reached an increase of 61%.
Movistar, a pioneer in the deployment of fiber infrastructure, began to market it in 2008 with a download speed of 30 Mbps. Since that date, the evolution has been unstoppable, both in the number of homes passed with fiber, and in the clients that have contracted services in that infrastructure and in the speed of the network, reaching 600 Mbps symmetric this year.
