Australia's largest stock trading and investment forum Australia's #1 stock forum

VOC

0.00%

$5.49 vocus group limited

VOC vs TPM vs TLS, page-27

First 27 Last

Share
Profile

Follow
DSD

15,757 Posts.

22/09/16

06:40

Post #: 19332362
Share

Originally posted by LightForce ↑

TPM is getting hit apparently because of NBN charging them more to recuperate the NBN astronomical cost (a total stuffed up project economically from the beginning). To lump TPM together with VOC and brand them as the same is not to understand their businesses properly.

Question to ask: How much of VOC's revenues are dependent on paying CVC? How much of a margin pressure does VOC have? VOC I thought is much more diversified than TPM, i.e. having more focus on fibre and data centre and voice products? Is not VOC supplying most of the data transfer through its own network of fibre? Most of the exposure to NBN CVC charges I would have thought is coming from Dodo that came with M2 merger? Surely VOC doesn't experience the same amount of margin pressure that TPM has? Not to mention that VOC has some revenue in NZ that doesn't get impacted by NBN. If anything, VOC sees that NBN gives an opportunity. Look at what it says in its annual report:

"Consumer revenue growth was derived from Vocus’ merger with M2. Future revenue growth is expected to be underpinned by growth in broadband services and supported by the NBN churn event where consumers are required to move to the NBN as the copper network is decommissioned. "

With 11000 km of fibre (and with further more to come from Nextgen), VOC will be a real major player to contend with. The fact that it's not fully utilising its capacity of its network offers significant growth prospects for it in a world of data traffic exponential growth. At worst case scenarios, I would see that VOC would at least achieve early teen double-digit growth for a few more years.

The other thing to mention here is the CFO departure. If the resignation of CFO (yes I think it's poorly timed as the market is reeling from TPM fall and nervous about the whole industry) would trigger such a share price plunge, then maybe being a CFO isn't a good job to undertake. Once a CFO of a company, forever the CFO of the company? Woww..

Ok, even ignoring all the above, and focusing just on short-term technicals, would not this stock be oversold all the way from $9.50 to a low of $5.62 today and closing at $6.09?

For the multitude of reasons above, I'm betting a small amount on VOC that it will rebound up to $7-$8 in the short-term. Do not throw the baby out with the bathwater. VOC is not TPM!

Expand

Looking at just the past month from high to low:
VOC has fallen 29%
TPM down 32%

But VOC's yr end 4 weeks ago v TPM of 2 days. Clearly TPM now far better value than 4 weeks ago but one needs to compare the 2 telcos at current SPs and to my way of thinking VOC represents better value although gap has obviously closed. The concern i have is that a couple of posters have mentioned billing probs since VOC made recent acquisitions. If true its bad for cash flow and customer relations. No telco can afford to lose customers to their opposition.

VOC Price at posting: $6.09 Sentiment: None Disclosure: Held
Upvote

0 Great analysis

Reply

Top Stories

SS1

Sun Silver gets that drill to thrill feeling from high grade hits at Maverick Spring

RCE

Recce's R327 found effective against E.coli during clinical trial

Wealth Within weighs in on shock 4% inflation read – and stocks that could survive the gloom

LRV

Larvotto identifies new exploration target at NSW's Hillgrove, boosting shares by nearly 20%

CMX

ChemX Materials kicks off first stage works at WA high purity alumina pilot

AVA

Ava Risk Group expands US presence with A$0.7M Substation Deal

Microcap Wrap: 5 explorers with news out today

Week 26 Wrap: Cerberus of inflation barks – rents, electricity & fuel – and world watches two elders bicker

LU7

Lithium Universe (ASX:LU7) board visits Quebec to engage key stakeholders

SVL

Silver Mines models five new calderas close to 396Moz Bowdens deposit