Many investors see telecom companies locally as the most sturdy dividend stocks, that will never collapse. Well here is a glimpse of some dark events that would hit telcos:
- During deep unemployment
- Removal of subsidies (coming to Singtel, Starhub and M1)
- Competition from cheaper sources (Viewquest and MyRepublic anyone?)
Gigaom have a good article here titled Has Europe Fallen Out of Love with the Mobile Phone?
I am invested in Vodafone but not Telefonica but what I do know is that Telefonica’s earnings are really falling drastically. No matter how strong a utility, consumer still ranks them in the order they need to survive.
Kyith is the Owner and Sole Writer behind Investment Moats. Readers tune in to Investment Moats to learn and build stronger, firmer wealth foundations, how to have a Passive investment strategy, know more about investing in REITs and the nuts and bolts of Active Investing.
Readers also follow Kyith to learn how to plan well for Financial Security and Financial Independence.
Kyith worked as an IT operations engineer from 2004 to 2019. Currently, he works as a Senior Solutions Specialist in Fee-only Wealth Advisory firm Providend. All opinions on Investment Moats are his own and does not represent the views of Providend.
You can view Kyith's current portfolio here, which uses his Free Google Stock Portfolio Tracker.
His investment broker of choice is Interactive Brokers, which allows him to invest in securities from different exchanges all over the world, at very low commission rates, without custodian fees, near spot currency rates.
You can read more about Kyith here.
- Singapore Savings Bonds SSB November 2023 Yield Bashes Higher to 3.32% (SBNOV23 GX23110V) - October 2, 2023
- How to Inflation-Adjust Your CPF LIFE Basic or Standard Plans - October 2, 2023
- Historic Bond Move Has Killed This Crazy Portfolio Strategy (for now…) - September 30, 2023
Dividends Warrior
Saturday 23rd of June 2012
Hi Drizzt,
Thanks for the info. I believe another reason is that Europeans still tend to make contact the "traditional" way. E.g. sipping coffee or tea with frens at the cafes on a lazy afternoon. Even if the economy is booming, I doubt they will be overly obsessed with their smartphones.
Singaporeans on the other hand, cannot get enough of smartphones. It is part of their lives, especially among the youngsters due to peer pressure. I believe the older generation (our parents) can live without smartphones, but not our generation and my children's generation. Even primary school students have handphones nowadays!
Of course, like what you said, during an extremely severe downturn, earnings will drop. If the economy is so bad that people have to sacrifice their handphones and internet, Singapore is in a pretty bad shape oredi.