Talktalk Telecom Share Discussion Threads

[masurenguy] 02/2/2018 07:58

Analysts at RBC Capital Markets upgraded its rating on telecom provider TalkTalk to 'outperform' on Thursday, saying that while not without issues, they believed concerns over the firm's balance sheet seemed to be overdone. RBC stated that with TalkTalk's revenues on the mend thanks to an uptick in subscribers in the fourth-quarter due to a solid adoption rate of its fixed low-price plans (FLPP), its analysts anticipated a top-line revenue growth from the firm of around 1.4% in 2019, before total revenue began to accelerate at a rate of around 2.7% in its 2020 trading year.

In terms of target price, RBC said, "We lower our price target from 190p to 150p. The change is mainly driven by a more conservative assumption on TalkTalk's corporate business. We had previously valued this at 14x EBITDA, in line with Gamma, and lower this to 10x. We also lower our estimates, factoring in a more conservative ARPU estimate. The analysts highlighted Ofcom's proposed 40mbps fibre price, due to be implemented before 1 April, as another potential saviour to TalkTalk's squeezed margins. Saving the group as much as £50m by 2021. "The balance sheet, whilst stretched, is not in danger, in our view. Peak leverage is at 3.1x in FY2018, comfortably below covenants at 4.0x," the report read.

[whatsup32] 01/2/2018 13:06

Eastborn. What was you saying about Vodafone:). Down nearly 4% today .
This market is making me nervous , worldwide share prices are going up but here in UK we are going down .

[quepassa] 01/2/2018 09:50

It will be interesting to see if ToscaFund further increase their stake at these historically cheap share price levels.


ALL IMO. DYOR.
QP

[bookbroker] 01/2/2018 09:02

Dividend should be cut completely, this company needs tos org out that debt pile, dividend is the nicest cut, basically lining the main shareholders pockets, he has quite enough thus far at the expense of small shareholders, but what do they matter!!

[eastbourne1982] 31/1/2018 21:56

VOD is riddled with debt yet it doesn't seem to impact on their share price.

[eeza] 31/1/2018 21:50

Well VOD have got the last part right. £24 for existing & £27 new. Most Co's have it the other way round and screw the loyal customers in favour of teasers to new customers.

[whatsup32] 31/1/2018 21:10

My comments re predictions was addressed to journalists . Case in point predictions by telegraph on M&S profit warning and there were a few others that I can’t recollect which proved to be correct .
I don’t usually listen to brokers too much as I don’t trust them .
In the case of Talk I can see the reasoning behind their predictions and if you are a holder please understand I am not trying to be negative for the sake of it .

Vodafone going head on into cheap broadband market will put huge pressure on talks margins , increase their churn and effect their market share . This business is all about market share.
They have to first buy the product from their COMPETITOR then sell it on with a margin added.
They have nothing else to sell. Many people only have land line for broadband these days so TALK can’t make any money from calls either
So in this case I think the predictions may not be too far out. If you have time go on to Vodafone site check out their broadband deals. It will blow your socks.
I am with Talk and pay £30 per month. Exact same deal is £27 on Vodafone for new customers and £24 for existing.

[septimus quaid] 31/1/2018 20:35

I was wondering what is a typical churn of shares for companies in the doo-doo (using today's volumes):

Capita, who today announced they were genuinely in a mess, had a total share churn of 10.6%.

Talk, who seem only in a mess due to market speculation, had a churn of 1.47%.

Another observation (illegal, insider dealing aside): there has been no new financial information for anyone to "pass a slide rule over" since the half-yearly report on 15/11/17.

As recently as 29/12/17, presumably referencing the same Nov 17 financials, Tosca (a large, well resourced, financial institution) thought it worthwhile to up their stake in Talk from 5.09% to 10.46%.

Again, privileged information aside, what have these negative brokers recently spotted in the Nov 17 results that hasn't been in "plain sight" to everybody else for the last 2+ months?

[whatsup32] 31/1/2018 20:34

I have also seen predictions mostly negative in the newspapers usually within a week or two pre company announcements. I was suprised by how accurate their predictions usually were. I suspected that the company may have implied what to expect in the results to a few select journalist . This way the market is softened up for the negative result and the journalist look good. In the case of Talk the writing is on the wall .
They have really just the one product and that is cheap broadband and they are now been undercut by Vodafone. And they have to buy that of Openreach and sell on with a margin.
Land phone most people usually use their mobile now so keep land line for broadband only.
They are trying to get into mobile and good luck with that.
Do they have anything else to offer?. NOPE
One trick pony now without a pony.

[whatsup32] 31/1/2018 18:41

TalkTalk plunges on cash fears. Source Daily telegraph. As a previous share holder would recommend reading the article. Article said Vodafone was after Talks customers

After reading the article I checked the Vodafone site . Found the deals offered were actually better then TalkTalk . I pay £30 for 76mpbs same deal on Vodafone £24 for existing customers and £27 new.

I am not sure how Talk will be able to handle the competition from Vodafone now. I can’t see them cutting the price to say £20 on like for like bases . That would be a huge drop . I think the div cut is definely on the table and maybe a rights issue to strengthening the bottom line

[bookbroker] 31/1/2018 17:29

Her other is a friggin MP., that why she is still involved in Govt., but her record here was nothing short of appalling!

[septimus quaid] 31/1/2018 14:32

Another lesson l have learned, never invest in a company with a woman at the helm.

Perversely, and this has a seriously negative impact for PIs, we have had female CEOs (present and previous) that are above any kind of criticism, constructive or otherwise, purely for reasons of political correctness (left-wing outfits like the BBC are kept at bay and the right-wing press are too scared of the PC brigade to say or do anything).

For sowing the seeds of Talk’s demise, Harding just didn’t get a damehood, she got a baronetcy FFS!

[bookbroker] 31/1/2018 13:05

I don’t expect he is that bothered (CW), he has already had over a hundred million in dividends from this one!

[septimus quaid] 31/1/2018 12:49

Normal procedure, in these situations, is to hide under the bedclothes in a foetal position.

Difficult to believe an old yard-dog like Dunstone got himself turned over like this, probably too busy gloating after getting one over on Dixon’s in the CPW sale.

[eastbourne1982] 31/1/2018 12:32

A divi cut won't really address the debt, they needed a rights issue two years ago, time is running out.

[septimus quaid] 31/1/2018 12:16

A dividend cut I can live with a rights issue would be a disaster.

A total rout today, irrespective of next Tuesday’s trading update, they need to get a RNS out.

Plus an investigation into insider dealing.

[muscletrade] 31/1/2018 11:39

Here is an extract of the Exane downgrade i mentioned.

'Historically TalkTalk has been the primary beneficiary of consumers spinning down, but this is no longer the case. Their trading momentum appears to have peaked, and their share of the discount market is coming under renewed pressure. We think there is another dividend cut ahead, and cut our price target by 35% to 90p".

[muscletrade] 31/1/2018 11:23

Exane Downgrade today i believe.

[bookbroker] 31/1/2018 11:02

East - always buy stock with a tidy balance sheet, you may not get the excitement, but at least you know your holding is safe, ok with a strong you generally find companies will squander it, but that initially drives the stock, that is when you bail when you have a profit, but often a good idea to retain a smidgeon just for the ride!

[eastbourne1982] 31/1/2018 10:44

I've taken hits over the last 12 months on companies with too much debt, any business with high debt is a no no for me now regardless of how tempting the valuation and chart look, those aspects mean nothing if the debt pile is far too big.

Wait for the finances to improve and then reassess.