Telefonica Shares Climb After Spain Moves to Buy Stake
By Adria Calatayud
Telefonica shares rose after Spain's state holding company said it would buy up to 10% of the telecommunications company, three months after Saudi Telecom Co. took a stake.
At 0834 GMT on Wednesday, shares in Telefonica traded 5.5% higher at EUR3.76, taking its gain in the year to date to 11%. The rise took the stock slightly above the level at which it closed on Sept. 5, the day when STC said it would buy the stake.
Based on Telefonica's closing share price on Tuesday, a 10% stake in the company would be worth 2.06 billion euros ($2.26 billion).
Spain's Sociedad Estatal de Participaciones Industriales said Tuesday that its move followed a decision by the Spanish cabinet and aims to provide Telefonica with greater shareholder stability.
In response, Telefonica said it remains focused on executing its recently approved strategic plan for the 2023-2026 period to continue to create value for its shareholders.
The news should support Telefonica shares in the short term given that SEPI is expected to buy shares on the market over the coming months, but over a longer-term horizon any perception of political interference could be taken badly by investors, Renta4 analyst Ivan San Felix Carbajo wrote in a research note.
The investment by SEPI comes after STC in September said it had acquired a 9.9% interest in Telefonica for EUR2.1 billion, saying it supported the company's leadership, strategy and its ability to create value.
Write to Adria Calatayud at adria.calatayud@dowjones.com
(END) Dow Jones Newswires
December 20, 2023 03:57 ET (08:57 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.-
Which AI Stocks Are Turning Hype Into Revenue?
-
Best- and Worst-Performing Stocks of May 2024
-
3 Stocks to Buy and 3 Stocks to Sell in June
-
Markets Brief: Friday’s Job Report in Focus
-
These Stocks Are (Still) Powering the Bull Market
-
5 Undervalued Energy Stocks to Play the AI Data Center Demand Boom
-
After Earnings, Is Lowe’s Stock a Buy, Sell, or Fairly Valued?
-
5 Stocks With the Largest Fair Value Estimate Cuts After Q1 Earnings
-
What Is Driving Small-Cap Stock Underperformance?
-
After Earnings, Is Zscaler Stock a Buy, a Sell, or Fairly Valued?
-
ASML Fair Value Raised as Outlook Improves
-
The Best Tech Stocks to Buy
-
Undervalued by 40%, This Stock Is a Buy After Earnings
-
After Earnings, Is MongoDB Stock a Buy, a Sell, or Fairly Valued?
-
Where We See Opportunities in June as Stocks Recover Losses
-
10 Top-Performing Dividend Stocks of the Month