France Telecom. France's dominant fixed line and important mobile telephony operator, part owned by the government. The share price has recently been caned, because the company seemed incapable of keeping to any policy for more that a few weeks; one example from 2005 was targeting no acquisitions unless they were earnings enhancing, then buying out a North African mobile system which was clearly value-destructive eight weeks later. However, albeit reluctantly, the company appears to have been forced into less Napoleonic strategies and to concentrate on its balance sheet - witness a recent announcement laying off 16,000 employees, mostly in France. Undoubtedly this will not happen in full, given the company's track record of disingenuity, but subsequent changes in management suggest that the government does not want a lame dog telephony company. Moreover, with falling capital expenditure, cost-cutting and debt refinancing, France Telecom is now throwing off considerable free cash flow and the share price is clearly supported by a well covered yield in excess of 5%.
| Sedol |
Type |
Price |
Date |
|
5176177 |
Buy |
EUR 17.092 |
18/05/2006 |
|
5176177 |
Buy |
EUR 17.94 |
19/04/2006 |
|
5176177 |
Buy |
EUR 18.559 |
03/04/2006 |
|
5176177 |
Buy |
EUR 18.444 |
07/03/2006 |
|
