Vodacom Group Limited, a unified communications provider, provides mobile voice, messaging, data, financial, and converged services to the consumer, business, and enterprise customers in South Africa and internationally.
The last earnings update was 4 days ago.
Discounted Cash Flow Calculation for DB:5VD using 2 Stage Free Cash Flow to Equity Model
The calculations below outline how an intrinsic value for
is arrived at by discounting future cash flows to their present value using the 2 stage method.
We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.
DB:5VD DCF 1st Stage: Next 10 year cash flow forecast
Amount off the current price
is available for.
Share price is
vs Future cash flow value of
Current Discount Checks
to be considered undervalued it must be available for at least 20% below the
current price. Less than 40% is even better.
Vodacom Group's share price is below the future cash flow value, and at a moderate discount (> 20%).
Vodacom Group's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for
it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing
when they are out of season, or how much your home is worth.
The amount the stock market is willing to pay for
is considered below, and whether this is a fair price.
Price based on past earnings
Vodacom Group's earnings available for a low price, and how does
this compare to other companies in the same industry?
Vodacom Group's earnings are expected to grow by 8.8% yearly, however this is not considered high growth (20% yearly).
Vodacom Group's revenue is expected to grow by 4.6% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can
be gauged below. We look back 3 years and see if they were any good at
predicting what actually occurred. We also show the highest and lowest estimates
looking forward to see if there is a wide range.
Vodacom Group's performance over the past 5 years by checking for:
Has earnings increased in past 5 years? (1 check)
Has the earnings growth in the last year exceeded that of the
industry? (1 check)
Is the recent earnings growth over the last year higher than the average annual growth over the
past 5 years? (1 check)
Is the Return on Equity (ROE) higher than 20%? (1 check)
Is the Return on Assets (ROA) above industry average? (1 check)
Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent
earnings report. Some checks require at least 3 or 5 years worth of data.
has a total score of
2/6, see the detailed checks below.
Note: We use GAAP Net Income excluding extraordinary items in all our calculations.
Management is one of the most important areas of a company. We look at
unreasonable CEO compensation, how long the team and board of directors have
been around for and insider trading.
TENURE AS CEO
Mr. Mohamed Shameel Aziz Joosub has been the Chief Executive Officer of Vodacom Group Limited since September 1, 2012. Mr. Joosub served as Managing Director of Vodacom (Pty) Limited from April 01, 2005 to March 31, 2011. Mr. Joosub served as the Chief Executive Officer at Vodafone España, S.A. (Vodafone Spain) since April 1, 2011. He served as the Managing Director of Vodacom Service Provider Company (Proprietary) Limited since September 2000 until February 2005. He was the Founder and Managing Director of Vodacom Equipment Company (Proprietary) Limited since 1998, the handset distribution company in the Vodacom Group. Mr. Joosub served as Managing Director of Vodacom South Africa at Telkom SA Ltd. from March 2005 to March 2011. He has International operational experience, Sound financial expertise, Strategy business leadership and Strong ICT experience and is Commercial strategist. He joined Vodacom in March 1994 and held various positions within the Group. He has been an Executive Director of Vodacom Group Limited since September 1, 2012 and previously served as its Executive Director from September 2000 to March 31, 2011. He has been Non Executive Director at Safaricom Limited since August 31, 2017. He was also appointed as non executive director of Vodacom Tanzania in August 2017. He served as Non-Executive Director of YeboYethu Limited. He is an Associated General Accountant and Commercial and Financial Accountant (South Africa). Mr. Joosub holds a Bachelor of Accounting Science (Honours) from the University of South Africa and holds a Masters of Business Administration degree from the University of Southern Queensland, Australia.
Mohamed Shameel's compensation has increased by more than 20% in the past year whilst earnings fell less than 20%.
Mohamed Shameel's remuneration is about average for companies of similar size in Germany.
Management Team Tenure
Average tenure and age of the
management team in years:
The average tenure for the Vodacom Group management team is over 5 years, this suggests they are a seasoned and experienced team.
Mohamed Shameel Joosub
CEO & Executive Director
CFO & Executive Director
Andries Daniel Delport
Chief Technology Officer
Chief Officer of Legal & Regulatory
Chief Human Resources Officer
Managing Director of Vodacom Ventures
Johan van Graan
Chief Risk Officer
Chief Officer of Strategy & New Business
Managing Director of Vodacom Congo
Managing Director of Vodacom Mozambique
Board of Directors Tenure
Average tenure and age of the
board of directors in years:
The tenure for the Vodacom Group board of directors is about average.
Vodacom Group Limited, a unified communications provider, provides mobile voice, messaging, data, financial, and converged services to the consumer, business, and enterprise customers in South Africa and internationally. The company offers contract or prepaid voice, messaging, and data services, as well as handsets. It also provides connectivity, and Internet and virtual private network services to its customers over various wireless, fixed-line, satellite, mobile, and converged technologies; and hosted cloud services, as well as enterprise mobility, unified communication, machine to machine communications, broadband, track and monitor, mHealth, and mEducation services. In addition, the company operates customer service operation centers; and offers carrier service products, including wholesale APN data, microwave, managed satellite, WiFi, international private leased circuit, Internet protocol (IP) transit, fiber, and IP-virtual private network. The company was founded in 1993 and is headquartered in Midrand, South Africa. Vodacom Group Limited is a subsidiary of Vodafone Investments SA (Pty) Limited.
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