Business

Telco stocks struggle in 2017

MTN was the best performing telco on the JSE in 2017.
MTN was the best performing telco on the JSE in 2017.

2017 was a tough year for South Africa's telecoms stocks listed on the Johannesburg Stock Exchange (JSE), with only MTN coming out with a positive return over the year.

MTN's share price grew by 8.3% between the beginning of January and the end of December 2017, according to data from Bloomberg.

In contrast, Vodacom's stock fell by 4.5% over the year. Blue Label Telecoms' significant investment in operator Cell C during 2017 did not inspire investors and the company's share price was down by 18.1% over the year. The worst performer over the year was Telkom, which saw its stock plunge by 35% in 2017.

So far in early 2018, most telcos' stocks were not fairing much better. MTN's share price, year to date (YTD), was up a miniscule 0.03% at R133.77 per share at the close of the market on 11 January.

Vodacom's share price has fallen 1.5% since the beginning of the year, trading at R141.80 per share. Blue Label has already seen an 11.3% drop YTD to R13.27 per share and Telkom was 1.6% lower YTD at R46.25 per share.

However, the majority of the stocks have performed well over a five-year period. Telkom's stock has grown by 174.5% over five years and Blue Label was up 50.8% over that period. Vodacom shares bought five years ago would now be worth 11.7% more.

The only stock that saw a decrease was MTN, as its share price dropped by 24.2% since January 2013.

Company

Share price

% change 2017

% change YTD

5YR return

MTN

R133.77

+8.3%

+0.03%

-24.2%

Vodacom

R141.80

-4.5%

-1.5%

+11.7%

Blue Label Telecoms

R13.27

-18.1%

-11.3%

+50.8%

Telkom

R46.25

-35%

-1.6%

+174.5%

* Share prices are all as at the market close on 11 January 2018; data from Bloomberg.

Read time 1min 30sec
Paula Gilbert
ITWeb telecoms editor.

Paula Gilbert is the Telecoms Editor at ITWeb. She is an award winning journalist covering telecoms, business, start-ups and new innovations in finance and mobile. She previously worked as a producer and reporter for business television channels Bloomberg TV Africa and CNBC Africa and started her career in radio. She has an Honours degree in Journalism from Rhodes University. Travel is always on Paula's mind, she has visited 30 countries so far and is currently researching her next adventure.

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