Week 24 delivered a gain of 0.1 percent to our European telecoms stock index, far behind the EuroStoxx 50’s 1.7 percent gain. The winners included Inmarsat (+11%) and Iridium (+8.3%), lagging this year’s solid performance of other satellite stocks. TalkTalk (+9.4%) and VEON (+7.1%) also did well, regaining some ground on losses suffered earlier in the year. Greek micro cap Forthnet (-15%) and Spanish small cap MasMovil (-10%) were the weakest stocks in our basket.
Mobile industry and Belgium
Significant news came for the mobile industry, with the finalisation of the Release 15 specification, the basis for 5G mobile technology. At the same time, the Belgian mobile market was shaken by telecoms minister De Croo, who suggested that the market needs a number four mobile network operator. Both Proximus (-5.2%) and Orange Belgium (-3.5%) were quick to oppose the suggestion of a newcomer facilitated by an upcoming 5G spectrum auction. Telenet (-2.7%) also ended the week down and announced price increases for next month.
Italy and Spain
In Italy, FastWeb, a unit of Swisscom (+0.2%) and Wind Tre, a joint venture of CK Hutchison (-1.7%) and VEON (+7.1%), responded to Iliad’s (-4.5%) recent market entry. Sky Italia scooped up broadcast rights for three seasons of Serie A football. Meanwhile, the EC cleared the acquisition of parent company Sky (-0.2%) by US cableco Comcast. And in the UK, CityFibre’s (+0.2%) takeover by Antin was also approved.
Telefonica (-1.7%) denied market rumours of planning a sale of its majority stake in Telefonica Deutschland (+0.1%). Meanwhile, in Spain Telefonica on the one hand raised several tariffs of its main Movistar brand and also launched the O2 brand into the market, with a low priced quad play offering.
YTD: outperformance for Sweden and Finland
Year-to-date there was little change from the previous week. Intelsat (+413%) and Altice (+160%) are still in the lead, whereas VEON and Tele Columbus (both -33%) are still closing the ranks. Geographically, a few regions stand out in a positive sense. First of all, satellite stocks are generally doing well. Eutelsat (-11%) is an exception, possible over fears of losing business from Sky Italia, launching broadband and terrestrial services. Swedish stocks are also up, except micro cap A3 (-30%): Com Hem (+25%), Telia (+16%) and Tele2 (+9.5%). For the best performances we still need to take a look at Finland: DNA (+30%) and Elisa (+20%).
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