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Vodacom Group Limited (VDMCY)
OTHER OTC:VDMCY
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Vodacom Group
(OTC:VDMCY)
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Rating:76Outperform
Price Target:
$9.00
▲(14.50% Upside)
Vodacom Group's strong financial performance is the most significant factor, supported by solid profitability and cash flow metrics. The technical analysis indicates stability, while the valuation is fair with an attractive dividend yield. These factors collectively contribute to a robust overall stock score.
Vodacom Group (VDMCY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$14.93B
Dividend Yield4.3%
Average Volume (3M)1.30K
Price to Earnings (P/E)16.4
Beta (1Y)0.70
Revenue Growth3.88%
EPS Growth4.83%
CountryUS
Employees7,642
SectorCommunication Services
Sector Strength97
IndustryTelecommunications Services
Share Statistics
EPS (TTM)N/A
Shares Outstanding2,077,841,300
10 Day Avg. Volume535
30 Day Avg. Volume1,300
Financial Highlights & Ratios
PEG Ratio3.89
Price to Book (P/B)2.72
Price to Sales (P/S)1.64
P/FCF Ratio8.90
Enterprise Value/Market Cap1.13
Enterprise Value/Revenue0.11
Enterprise Value/Gross Profit0.20
Enterprise Value/Ebitda0.31
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusModerate Buy
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Vodacom Group Business Overview & Revenue Model
Company DescriptionVodacom Group (VDMCY) is a leading telecommunications company based in South Africa, providing a wide range of communication services across multiple sectors, including mobile voice, messaging, data, and fixed-line services. Established in 1994, Vodacom operates primarily in South Africa but also has significant operations in several African countries, including Tanzania, Mozambique, and the Democratic Republic of the Congo. The company offers core products and services such as mobile network services, mobile banking, IoT solutions, and digital services, aiming to enhance connectivity and digital inclusion across the continent.
How the Company Makes MoneyVodacom generates revenue primarily through its mobile network services, which include voice calls, SMS, and data services. The company has a robust subscriber base, with revenue significantly driven by data usage as consumers increasingly rely on mobile internet for communication and entertainment. Additionally, Vodacom earns income from value-added services such as mobile banking through its M-Pesa platform, mobile advertising, and partnerships with content providers. The company also benefits from fixed-line services, including broadband and enterprise solutions, catering to both individual and corporate clients. Strategic partnerships with technology firms and fintech companies enhance its service offerings and create new revenue streams. Overall, Vodacom's diversified portfolio and focus on innovation play a crucial role in sustaining its financial performance.
Vodacom Group Earnings Call Summary
Earnings Call Date:Jul 23, 2025
(Q2-2025)
| % Change Since: |
Next Earnings Date:Nov 10, 2025
Earnings Call Sentiment Neutral
The earnings call reflected a mixture of strong growth in financial services and data, as well as impressive local performances in Egypt. However, significant challenges were presented by currency devaluations affecting earnings, disappointing international segment performance, and regulatory setbacks in South Africa.Q2-2025 Updates
Positive Updates
Strong Growth in Financial Services
Financial services customers increased by 12.7%, with M-Pesa merchant base growing by 22% to 1.2 million merchants. The financial service revenue from consolidated entities reached 6.7 billion in the period, up 7.8% in rands.
Prepaid Data Growth
Prepaid data revenue grew by 21.8%, making up 28.2% of service revenue, indicating strong demand in the market.
Impressive Performance in Egypt
Egypt's local currency revenue grew by 44.1%, with service revenue contributing 22.1% to the group. EBITDA growth was 65.1% in local currency.
Expansion of 4G Sites
Vodacom added 1,133 new 4G sites across the group over the last six months, expanding digital inclusion.
Negative Updates
Currency Devaluation Impact
Significant currency devaluations in Egypt and Ethiopia negatively impacted earnings, with HEPS declining by 19.4% to 353 cents.
International Business EBITDA Decline
International business EBITDA was down 20%, affected by foreign exchange pressures and one-off costs in the DRC.
Disappointment in South Africa
South Africa's revenue growth was modest at 2.4%, impacted by pressures in the wholesale segment, and the MAZIV transaction was prohibited by the competition tribunal.
Revenues Affected by Devaluations
Group revenue grew by only 1% on a reported basis due to the Egyptian devaluation, despite a normalized growth of 9.9%.
Company Guidance
In the recent call, Vodacom provided a comprehensive strategy update and interim results for the period ending September 30, 2024. The company reported connecting 206 million customers and providing financial services to 83 million customers. Despite significant currency headwinds, Vodacom achieved a normalized group service revenue growth of 9.9% and an EBITDA growth of 8.5%. The international business was impacted by a 44.1% local currency growth in Egypt and a challenging performance in the DRC due to one-off costs. Vodacom's financial services business, including M-Pesa, grew by 17.6% on a normalized basis, contributing 11.4% to the group's service revenue. The company continues to focus on digital and financial inclusion, aiming to upscale 1 million young people and increase smartphone penetration. Vodacom has also committed to net zero emissions by 2035 and emphasizes environmental solutions. The interim dividend was declared at 285 cents per share, with a payout ratio higher than the typical minimum due to the Ethiopian devaluation. Looking forward, Vodacom aims to diversify its product offerings and drive double-digit growth by 2030.Vodacom Group Financial Statement Overview
Summary
Vodacom Group demonstrates solid financial health with strong profitability and growth trends. The income statement shows consistent revenue growth and robust margins. The balance sheet is stable with low leverage, though there is room for enhancing equity strength. Cash flows are impressive, with strong operational cash generation.Income Statement
The company shows a strong income statement performance with consistent revenue growth, increasing from 150.59 billion to 152.23 billion annually. Gross profit margin is healthy at approximately 61%, and the net profit margin is stable around 11%. EBIT and EBITDA margins are robust, reflecting efficient operations and cost management. The revenue growth rate from the previous year is positive, indicating continued expansion.86
Very Positive
Balance Sheet
The balance sheet reveals a solid financial structure with a low debt-to-equity ratio of 0.02, indicating low leverage and reduced financial risk. The return on equity is decent at approximately 18%, suggesting effective use of shareholder funds. However, the equity ratio is moderate, with stockholders' equity constituting about 37% of total assets, implying room for strengthening the equity base.78
Positive
Cash Flow
Cash flow metrics are strong, with robust operating cash flows exceeding net income, highlighting good cash generation capabilities. Free cash flow growth is positive at 5.34%, demonstrating effective capital expenditure management. The operating cash flow to net income ratio is approximately 3.18, indicating efficient conversion of profit to cash.82
Very Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 152.23B | 152.23B | 150.59B | 6.97B | 6.88B | 5.98B |
| Gross Profit | 82.45B | 92.89B | 82.76B | 2.76B | 2.81B | 2.42B |
| EBITDA | 55.03B | 58.80B | 59.07B | 44.61B | 43.45B | 43.09B |
| Net Income | 16.60B | 16.60B | 16.29B | 985.68M | 1.16B | 1.01B |
Balance Sheet | ||||||
| Total Assets | 249.98B | 249.98B | 240.61B | 12.87B | 12.18B | 11.65B |
| Cash, Cash Equivalents and Short-Term Investments | 27.17B | 27.17B | 34.84B | 1.30B | 1.25B | 1.50B |
| Total Debt | 2.09B | 2.09B | 73.48B | 3.96B | 3.59B | 3.38B |
| Total Liabilities | 146.33B | 146.33B | 136.78B | 7.38B | 6.33B | 5.84B |
| Stockholders Equity | 92.02B | 92.02B | 92.76B | 4.84B | 5.44B | 5.38B |
Cash Flow | ||||||
| Free Cash Flow | 28.11B | 28.11B | 26.69B | 1.22B | 1.30B | 1.24B |
| Operating Cash Flow | 52.80B | 52.80B | 49.01B | 2.40B | 2.23B | 2.06B |
| Investing Cash Flow | -24.21B | -24.21B | -20.72B | -1.88B | -1.04B | -814.02M |
| Financing Cash Flow | -25.86B | -25.86B | -25.70B | -375.41M | -1.09B | -1.20B |
Vodacom Group Technical Analysis
Neutral
7.86
Price Trends
7.82
Positive
7.82
Positive
7.26
Positive
Market Momentum
0.02
Positive
48.64
Neutral
23.92
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For VDMCY, the sentiment is Neutral. The current price of 7.86 is below the 20-day moving average (MA) of 7.91, above the 50-day MA of 7.82, and above the 200-day MA of 7.26, indicating a neutral trend. The MACD of 0.02 indicates Positive momentum. The RSI at 48.64 is Neutral, neither overbought nor oversold. The STOCH value of 23.92 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for VDMCY.
Vodacom Group Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $11.11B | 15.55 | 14.93% | 6.33% | -4.90% | 14.83% | |
77 Outperform | $20.28B | 19.03 | 8.36% | 4.85% | -3.16% | 4.70% | |
76 Outperform | $14.93B | 16.45 | 18.39% | 4.30% | 3.88% | 4.83% | |
74 Outperform | $20.60B | 15.32 | 15.54% | 6.22% | -5.21% | -7.45% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
60 Neutral | $7.81B | 19.27 | ― | 4.97% | -8.16% | -51.97% | |
54 Neutral | $27.74B | ― | -7.17% | 4.27% | 0.89% | -494.16% |
* Communication Services Sector Average
VDMCY
Vodacom Group
7.86
2.44
45.02%
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SKM
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20.10
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-9.54%
VIV
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12.55
3.88
44.75%
TIMB
TIM
22.90
9.79
74.68%
VOD
Vodafone
11.58
2.70
30.41%
Vodacom Group Corporate Events
Vodacom Group Reports Robust Revenue Growth
Jul 24, 2025
Vodacom Group Limited is a telecommunications company based in South Africa, providing a range of communication services, including mobile and financial services, across multiple African countries.
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.