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(COM) 05/09/00 11:34: STOCKWATCH: Vodafone rallies on Microsoft collaboration, broker comment
STOCKWATCH: Vodafone rallies on Microsoft collaboration, broker comment
LONDON (AFX) - Shares in Vodafone Group PLC rallied from a earlier torpor in
late morning trade helped by news of a collaboration deal with Microsoft Corp,
and by a raft of positive broker comment after a lunch with the company
yesterday, dealers said.
At 11.24 am, Vodafone shares had rebounded to the top of the FTSE 100
leaders board, adding 10 pence at 295, having earlier slipped back to a session
low of 280 pence.
Vodafone today said it has entered into a joint project with Microsoft Corp
to expand corporate mobile intranet services and bring Microsoft Outlook
functionality to wireless mobile devices.
It added that both companies are collaborating on a European trial of new
corporate mobile intranet products and services, with commercial deployments
planned for Spring 2001.
Yesterday, the UK group hosted a summer lunch and presentation for analysts
which provided an update on group trading, and presentations from Vizzavi and
J-Phone, dealers added.
In the wake of the meeting, Deutsche Bank repeated its 'strong buy' rating
and 465 pence price target for Vodafone shares.
The German-owned broker said it is currently reviewing its forecasts for
Vodafone, and expects to reduce its proportionate EBITDA estimates by around 5
pct to reflect the costs of massive growth in Germany.
However, Deutsche Bank sees potential for an upgrade of its pretax
pre-goodwill forecasts based on a reduction in its net interest burden estimate.
The broker concluded that Vodafone's valuation is 'compelling', and it
thinks the shares could perform strongly, particularly if the Hutchison stake
overhang is removed.
SG Securities also repeated its 'strong buy' rating for Vodafone after the
summer lunch, with CSFB, Dresdner Kleinwort Benson and WestLB Panmure all
reiterating a 'buy' stance - WestLB has a 500 pence target price for the stock.
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