Deutsche Telekom AG (DT-FWB)

Buy Verizon? At this point in the cycle, interests rates are getting quite low, generally getting a telco is an interesting idea and been recommending this for clients. Recently got out of Verizon and substituted into AT&T. Nothing wrong with Verizon, 5G, fiber-to-the-home, etc. everything is going to work, just thinks there is a better yield opportunity with AT&T. Also owns Deutsche Telekom to play the T-Mobile Sprint merger.

This is in a similar place to Orange, China Mobile and other large and successful telecom companies. They are a dividend play, not a growth play. Dividend plays are less attractive in a rising interest environment. This is a rational competitor and investors are not likely to lose money in it.

If he owned this, he would Sell. He can see more downside, as people have been buying these as dividend plays. They are low-growth or no-growth companies that are struggling as the world evolves in their very difficult sector. There are better places to put your money.

There are not a lot of negative stocks out there. This stock is just chugging along. He would have no problem holding on at this stage. It is starting to build a bit of a base at around $18, and could easily go through $20.

One of the largest telecommunication companies in Germany. Has a significant stake in T-Mobile in the US. The German telecom market has consolidated, and there are only about 4 big players. Still in earlier stages of LCE adoption, meaning that smart phones haven’t fully penetrated the market. They’ll get the benefit of increased smart phone penetration, bundling, and at some point look to monetize their T-Mobile position, which would unlock a lot of shareholder value. Also, has a 4%-5% stable dividend yield.

Cut the dividend from €70 to €50 and he bought following that cut. Stock has run up from about €850 to about €930. Longer-term he feels the US assets are going to be sold off which will generate about a 3^rd of the enterprise value. Dividend is safe. This will be a play on a European recovery.

(Market call minute.) A growth challenged European telco.