Zacks Investment Research downgraded shares of Telefonica SA (NYSE:TEF) from a hold rating to a sell rating in a research note issued to investors on Tuesday.
According to Zacks, “In a major setback to Telefonica, the company recently suffered a serious jolt as it was forced to abandon its plan to conduct an IPO for its infrastructure division Telxius. Hence, Telefonica is looking forward towards a successful IPO of its U.K. wireless unit, O2 UK which should reduce its debt burden. Notably, the company has a debt laden balance sheet which may pose problems in future. Moreover, domestic competition along with increased competition in Brazil is a major threat. However, Telefonica is poised to benefit from the widespread adoption of broadband and data services, pricing revision, network enhancement and strategic collaborations. Launch of video services in several new Latin American markets, continued focus on organic growth, portfolio optimization and strong presence in the Mexican wireless industry bodes well. Telefonica is also capitalizing on the opportunities in the digital world through several growth strategies.”
Several other analysts have also issued reports on TEF. Goldman Sachs Group Inc. lowered Telefonica SA from a buy rating to a neutral rating in a report on Tuesday, June 28th. Royal Bank Of Canada initiated coverage on Telefonica SA in a report on Thursday, October 20th. They set an underperform rating on the stock. Four research analysts have rated the stock with a sell rating, one has issued a hold rating and three have assigned a buy rating to the company’s stock. The stock currently has a consensus rating of Hold and an average price target of €11.00 ($12.09).
Telefonica SA (NYSE:TEF) opened at 10.03 on Tuesday. The company has a market cap of $49.25 billion, a P/E ratio of 24.52 and a beta of 1.52. Telefonica SA has a 52-week low of $8.34 and a 52-week high of $13.53. The company’s 50 day moving average price is $10.08 and its 200 day moving average price is $10.09.
A number of hedge funds have recently added to or reduced their stakes in TEF. BlackRock Inc. acquired a new stake in Telefonica SA during the first quarter valued at about $3,133,000. M&T Bank Corp raised its stake in Telefonica SA by 4.7% in the first quarter. M&T Bank Corp now owns 30,085 shares of the company’s stock valued at $335,000 after buying an additional 1,358 shares in the last quarter. UBS Group AG raised its stake in Telefonica SA by 16.7% in the first quarter. UBS Group AG now owns 595,822 shares of the company’s stock valued at $6,632,000 after buying an additional 85,256 shares in the last quarter. BNP Paribas Arbitrage SA raised its stake in Telefonica SA by 188.8% in the second quarter. BNP Paribas Arbitrage SA now owns 17,889 shares of the company’s stock valued at $170,000 after buying an additional 11,694 shares in the last quarter. Finally, Creative Planning raised its stake in Telefonica SA by 184.1% in the second quarter. Creative Planning now owns 58,999 shares of the company’s stock valued at $559,000 after buying an additional 38,229 shares in the last quarter. Hedge funds and other institutional investors own 1.36% of the company’s stock.
About Telefonica SA
Telefonica, SA is an integrated and diversified telecommunications group operating in Europe and Latin America. The Company’s services and products include Mobile business, Fixed-line telephony business and Digital services. The Company’s segments include Telefonica Spain, Telefonica Brazil, Telefonica Germany, Telefonica UK and Telefonica Hispanoamerica.