Telefónica, cathartic: changes its face, runs out of shorts and will reduce debt
Telefonica presents a cathartic message on its Board. It changes its logo or as it is now called, marketing through, launches a corporate image, highlighting its new identity, says the company “resulting from the strategic plan presented in 2019”. It is now being implemented with the reelection of its president by five more points, with almost 85% of the support and several announcements on the table.
Here we see the evolution of the logo, which takes the air from the image created in the 80s to leave the name in the background. First change of face in 23 years going back to the past, but trying, they point out, to conquer the future.
A future that its re-elected president, José María Álvarez Pallete, has spoken about to show some brushstrokes. One of them, the intention to reduce the galloping debt that continues to weigh heavily on the operator, despite the strong corrections in recent years. Without giving dates, “in the coming months” they speak of reducing debt to 26,000 million and that still exceeds 35,200 million euros. If successful, it would mean placing it at half of 2016 levels.
And at its base, divestments will continue to be able to implement it, hand in hand with the new Telefónica Tech that includes submarine cables, data centers or some businesses of its subsidiaries in Latin America. But perhaps one of the most direct messages of the company is the one referred to the price to which its president indicates that it will be given. absolute priority, good news, if true, for shareholders.
And that price is the one that we now analyze with the operator that continues to cut monthly positions, despite yesterday’s rise, without being able to resume the level of 4 euros per share lost on March 26 and on which it has not been returned. To place In the month it yields 6.3% but gains in the year 16.22%.
The analysts who have just renewed their opinion on Telefónica in the last week, they place their average target price, with advice to maintain the value, at 4,283 euros per share, which means giving the value an upward trend of 13.5%. If we break it down, the best comes from Bank of America Merrill Lynch, which grants it a PO of 5.4 euros with purchase advice, followed by Alantra, who also bets on buying with a PO of 4.45 euros per share. Barclays continues, which sees it neutral with 4.2 euros, Goldman Sachs, also neutral with a target price of 4.1 euros per share, Credit Suisse, also neutral, with 3.8 euros and closes the also neutral on the value Citi, whose PO stands at 3.75 euros per share.
Another novelty in recent days for the stock is that relevant short positions evaporate: AQR Capital abandoned its positions on the 20th of this month from 0.49% after having entered Telefónica more than a year later, last April 9 and after oscillating to a negative 0.52% on the value.
The Investment Strategies premium indicators reveal that Telefónica, revised downwards and with a rebound effect, barely achieves a score of 4 out of 10 possible points. In the most favorable part, the long-term upward trend and the overall slow positive moment stand out for the telecommunications operator. On the other side, we find that the medium-term trend is downward for the value, the fast total moment is negative, the business volume, in its two aspects, is decreasing for the value and the volatility is increasing both in the medium and long term. .
Following from a technical point of view, Telefónica “the transfer of positions forces it to drill both its simple moving average of 40 periods or the medium term and the upward guideline that starts from 2,568 euros per share, references whose violation They open a technical decline with the next downward target of 3.518 euros per share, a level that is an approximation to its 200-period or long-term simple moving average “, according to the technical analyst of Investment Strategies, José Antonio González.
Telefónica on daily chart with average amplitude range in percentage, MACD oscillator and trading volume.
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