Proactive Investors - Vodafone Group PLC (LON:VOD) shares have hit their lowest level since 1997 as shareholders were left unconvinced by the turnaround plan for the British mobile phone giant.
Shares in the UK telco slumped around 6% to 84.93p after earlier hitting a session low of 83.13p.
It’s fair to say AJ Bell’s Russ Mould wasn’t overly impressed.
“The company can adjust, rebase and try to flatter its reported figures all it wants, but the share price fall shows the FTSE 100 firm isn’t fooling anyone, and that is because there are three glaring flaws in new Vodafone boss’ Margherita Della Valle’s plan to return Vodafone to investors’ favour,” he said.
“First, the strategy focuses on ‘Customers, Simplicity and Growth,’ but growth is not a strategy – it is what results from strategy.”
“Second, there is no growth, as Vodafone is steering down profit and cash flow guidance for the new fiscal year and declares another unchanged dividend.”
“Finally, the company still looks like an over-indebted investment trust of telecoms assets and the new CEO’s plan does nothing to address the structural challenges that face Vodafone, as it tries to compete on too many fronts, in too many markets with too little resource, thanks to its hefty borrowings.”
There was some good news with debt coming down while Della Vale flagged Turkey, Portugal, Ireland, the Czech Republic, South Africa and Greece as areas that are doing well.
"The bad news is that the firm’s biggest markets – the UK, Germany, Spain and Italy – are not performing as hoped or needed, so there is much work to be done," Mould added.