BUY Absa I nvestments r ecent l y updated its research on telecommunications group MTN following a trading update. Lance Gordon, portfolio manager, told clients: “MTN remains on track to meet its unchanged guidance for f inancial year 2013, spearheaded by a pleasing Nigerian performance.
While concerns about t he softer consumer environment and intensifying competition resulted in a weakerthan-anticipated SA performance, this appears to be more industry-specif ic than company-specific. The impact of Nigerian regulatory changes on MTN’s Nigerian contribution remains to be seen.
The share is currently trading on a 15x P/ E and a very attractive 5% dividend yield. Earnings per share and dividends per share are likely to continue to grow providing the potential for share price appreciation.”