JSE:VOD

Stock Analysis Report

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Executive Summary

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.

Rewards

Earnings have grown 5.3% per year over the past 5 years

Pays a high and reliable dividend of 6%

Risk Analysis

No risks detected for VOD from our risk checks.


Snowflake Analysis

Excellent balance sheet established dividend payer.


Similar Companies

Share Price & News

How has Vodacom Group's share price performed over time and what events caused price changes?


Latest Share Price and Events

Stable Share Price: VOD has not had significant price volatility in the past 3 months.


Market Performance


7 Day Return

3.6%

VOD

1.6%

ZA Wireless Telecom

6.1%

ZA Market


1 Year Return

5.5%

VOD

-12.7%

ZA Wireless Telecom

-20.8%

ZA Market

Return vs Industry: VOD exceeded the ZA Wireless Telecom industry which returned -12.7% over the past year.

Return vs Market: VOD exceeded the ZA Market which returned -20.8% over the past year.


Shareholder returns

VODIndustryMarket
7 Day3.6%1.6%6.1%
30 Day7.6%1.9%6.9%
90 Day17.2%-3.0%-3.0%
1 Year12.8%5.5%-5.8%-12.7%-9.3%-20.8%
3 Year-5.2%-21.3%-3.2%-19.4%8.2%-12.5%
5 Year30.6%-2.7%-3.7%-30.0%15.2%-13.9%

Price Volatility Vs. Market

How volatile is Vodacom Group's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is Vodacom Group undervalued compared to its fair value and its price relative to the market?

13.92x

Price to Earnings (PE) ratio


Share Price vs. Fair Value

Below Fair Value: VOD (ZAR130.8) is trading above our estimate of fair value (ZAR82.98)

Significantly Below Fair Value: VOD is trading above our estimate of fair value.


Price To Earnings Ratio

PE vs Industry: VOD is poor value based on its PE Ratio (13.9x) compared to the Wireless Telecom industry average (13.6x).

PE vs Market: VOD is poor value based on its PE Ratio (13.9x) compared to the ZA market (8.4x).


Price to Earnings Growth Ratio

PEG Ratio: VOD is poor value based on its PEG Ratio (1.8x)


Price to Book Ratio

PB vs Industry: VOD is overvalued based on its PB Ratio (2.4x) compared to the XF Wireless Telecom industry average (2.2x).


Next Steps

Future Growth

How is Vodacom Group forecast to perform in the next 1 to 3 years based on estimates from 9 analysts?

7.8%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: VOD's forecast earnings growth (7.8% per year) is below the savings rate (9.5%).

Earnings vs Market: VOD's earnings (7.8% per year) are forecast to grow slower than the ZA market (19.6% per year).

High Growth Earnings: VOD's earnings are forecast to grow, but not significantly.

Revenue vs Market: VOD's revenue (3.9% per year) is forecast to grow slower than the ZA market (8.3% per year).

High Growth Revenue: VOD's revenue (3.9% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: VOD's Return on Equity is forecast to be high in 3 years time (20.9%)


Next Steps

Past Performance

How has Vodacom Group performed over the past 5 years?

5.3%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: VOD has high quality earnings.

Growing Profit Margin: VOD's current net profit margins (17.6%) are higher than last year (17.1%).


Past Earnings Growth Analysis

Earnings Trend: VOD's earnings have grown by 5.3% per year over the past 5 years.

Accelerating Growth: VOD's earnings growth over the past year (7.5%) exceeds its 5-year average (5.3% per year).

Earnings vs Industry: VOD earnings growth over the past year (7.5%) underperformed the Wireless Telecom industry 7.5%.


Return on Equity

High ROE: VOD's Return on Equity (16.6%) is considered low.


Next Steps

Financial Health

How is Vodacom Group's financial position?


Financial Position Analysis

Short Term Liabilities: VOD's short term assets (ZAR47.8B) exceed its short term liabilities (ZAR36.8B).

Long Term Liabilities: VOD's short term assets (ZAR47.8B) do not cover its long term liabilities (ZAR53.4B).


Debt to Equity History and Analysis

Debt Level: VOD's debt to equity ratio (39.4%) is considered satisfactory.

Reducing Debt: VOD's debt to equity ratio has reduced from 114% to 39.4% over the past 5 years.

Debt Coverage: VOD's debt is well covered by operating cash flow (83.3%).

Interest Coverage: VOD's interest payments on its debt are well covered by EBIT (6.2x coverage).


Balance Sheet


Next Steps

Dividend

What is Vodacom Group's current dividend yield, its reliability and sustainability?

6.00%

Current Dividend Yield


Upcoming Dividend Payment


Dividend Yield vs Market

Notable Dividend: VOD's dividend (6%) is higher than the bottom 25% of dividend payers in the ZA market (4.19%).

High Dividend: VOD's dividend (6%) is low compared to the top 25% of dividend payers in the ZA market (11.59%).


Stability and Growth of Payments

Stable Dividend: VOD's dividends per share have been stable in the past 10 years.

Growing Dividend: VOD's dividend payments have increased over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: At its current payout ratio (83.6%), VOD's payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: VOD's dividends in 3 years are forecast to be covered by earnings (88.6% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

5.5yrs

Average management tenure


CEO

Mohamed Shameel Joosub (48yo)

7.75yrs

Tenure

R38,261,997

Compensation

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 ...


CEO Compensation Analysis

Compensation vs Market: Mohamed Shameel's total compensation ($USD2.27M) is about average for companies of similar size in the ZA market ($USD2.93M).

Compensation vs Earnings: Mohamed Shameel's compensation has been consistent with company performance over the past year.


Leadership Team

NamePositionTenureCompensationOwnership
Mohamed Shameel Joosub
CEO & Executive Director7.75yrsR38.26m0.070% ZAR155.9m
Phil Streichert
CFO & Executive Director4.83yrsR927.75kno data
Dejan Kastelic
Chief Technology Officer0.083yrno datano data
Nkateko Nyoka
Chief Officer of Legal & Regulatory12.67yrsR8.14mno data
Matimba Mbungela
Chief Human Resources Officer6.08yrsR5.86mno data
T. Ralebitso
Managing Director of Vodacom Venturesno datano datano data
Johan van Graan
Chief Risk Officerno datano datano data
Muriel Loriloux
Managing Director of Vodacom Congono datano datano data
Jerry Mobbs
Managing Director of Vodacom Mozambiqueno datano datano data
Joaquim Jorge Mendes
Chief Officer of Consumer Business Unit4yrsno datano data

5.5yrs

Average Tenure

47yo

Average Age

Experienced Management: VOD's management team is seasoned and experienced (5.5 years average tenure).


Board Members

NamePositionTenureCompensationOwnership
Mohamed Shameel Joosub
CEO & Executive Director7.75yrsR38.26m0.070% ZAR155.9m
Phil Streichert
CFO & Executive Director4.83yrsR927.75kno data
David Brown
Independent Non-Executive Director8.42yrsR1.16mno data
Sakumzi Macozoma
Lead Independent Non-Executive Director2.92yrsR1.03mno data
Phillip Moleketi
Independent Non Executive Chairman2.92yrsR2.70m0.00095% ZAR2.1m
Phuti Mahanyele-Dabengwa
Independent Non-Executive Director1.42yrsR183.31kno data
Vivek Badrinath
Non Executive Director3.5yrsR880.98kno data
Sunil Sood
Non-Executive Director1.92yrsR332.23kno data
Leanne Wood
Non-Independent Non-Executive Director0.92yrno datano data
John William Otty
Non-Executive Director7.75yrsR611.45kno data

3.2yrs

Average Tenure

52.5yo

Average Age

Experienced Board: VOD's board of directors are considered experienced (3.2 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

Vodacom Group Limited's company bio, employee growth, exchange listings and data sources


Key Information

  • Name: Vodacom Group Limited
  • Ticker: VOD
  • Exchange: JSE
  • Founded: 1993
  • Industry: Wireless Telecommunication Services
  • Sector: Telecom
  • Market Cap: R222.277b
  • Shares outstanding: 1.70b
  • Website: https://www.vodacom.com

Number of Employees


Location

  • Vodacom Group Limited
  • Vodacom Corporate Park
  • 082 Vodacom Boulevard
  • Midrand
  • Gauteng
  • 1685
  • South Africa

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
VODJSE (The Johannesburg Securities Exchange)YesOrdinary SharesZAZARMay 2009
5VDDB (Deutsche Boerse AG)YesOrdinary SharesDEEURMay 2009
VODA.FOTCPK (Pink Sheets LLC)YesOrdinary SharesUSUSDMay 2009
VDMC.YOTCPK (Pink Sheets LLC)SPONSORED ADRUSUSDDec 2009

Biography

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, 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. 


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2020/06/06 20:31
End of Day Share Price2020/06/05 00:00
Earnings2020/03/31
Annual Earnings2020/03/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.