The European telecoms stocks had a relatively good week. The EuroStoxx 50 index was down 4.5 percent in week 41, versus a decline of 2.0 percent for our telecoms index. The week's performances varied between a gain of 20 percent for Forthnet (Greece) and a drop of 9.9 percent for Play (Poland). Microcaps aside, the performance ranged from up 6.1 percent for Iliad to down 5.8 percent for Vodafone.
Tele2 (-0.9%) took a final hurdle in the Com Hem (-0.5%) takeover process with the approval from the European Commission. The proposed merger of the Dutch Tele2 branch with Deutsche Telekom's T-Mobile (-1.2%) appears to be more complicated, as DT was reported to offer concessions to get the deal through. In other Dutch news, KPN (-1.8%) was rumoured to be working on a new strategic plan involving cost reductions and job losses. Investors also looked ahead to the DNA (+2.9%) results as the company provided the market with an upgrade to its outlook.
The year-to-date performances vary wildly, from +827 percent for Intelsat (down from the previous week's record of +895%) and -68 percent for Forthnet. Disregarding the micro- and nanocaps in our index, the range is still considerable: from up 81 percent for Altice Europe to down 47 percent for Iliad. Our index's heaviest constituents are Deutsche Telekom (-6.4% YTD) and Vodafone (-36% YTD). Deutsche Telekom and Orange (-7.0%) are the best performing incumbents this year (disregarding microcaps). The weakest former monopolies are TIM (-32%) and KPN (-23%).
