Goldman Sachs Adds Vodafone to Conviction List

In a research report published earlier today, Goldman Sachs has added Vodafone

to the Conviction List, as there is substantial rerating potential due to underperformance in the sector ytd. According to Goldman Sachs, “We forecast solid fiscal 2012 results on May 22. We expect management to reiterate long-term guidance for 1%-4% revenue growth and ‘stabilising' EBITDA margins, while acknowledging that revenue growth will trend around the bottom of this range in 2013 as MTR pressure progressively ramps in Europe. On a proportionate basis, we expect Vodafone to grow 2013 revenues and EBITDA by 2.5%, much faster than almost all its peers. Our 2013 FCF forecasts are 8% ahead of company-gathered consensus owing to our expectation that the VZW dividend will rise to $13 bn.” Goldman Sachs maintains its Buy rating and $36.90 PT on Vodafone, which is currently trading at $27.36.