Berenberg lifts target price for Vodafone, cites German M&A potential.
Berenberg has raised its target price for Vodafone from 123p to 140p and reiterated a 'buy' rating, saying the stock remains "relatively cheap" compared with the wider European telco sector.
Vodafone Group
02 October 2026 13:40:03
Source: Sharecast
The broker attributed the improved outlook to July's first-quarter results from the telecoms giant that came in at the upper end of guidance, driven by strong growth at Vodacom and in Germany.
Analysts said the company is at a free cash flow inflection point, and is expected to deliver sustainable FCF and dividend growth over the coming years, from the reported €2.62bn in FY26.
The company also has "substantial future capacity for value-creation opportunities", they said, with further share buybacks and small bolt-on M&A deals possible from FY28 onwards.
Berenberg said that Vodafone's UK capital markets day on 8 October could be a catalyst for the stock, saying: "Potential German telecom consolidation is one of the most likely 'in-market' sector deals."
"On 10 July 2026, Vega (owned by the Xavier Niel family) acquired a c16% share of the voting rights in Vodafone from Etisalat, and later raised its stake to c19%. We wonder if Mr Niel’s involvement increases the likelihood of Vodafone looking to acquire 1&1, driving German consolidation," the broker said.
Vodafone shares were up 2.22% at 126.85p by 1338 BST.
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