Uzo Capital shared a bullish thesis on Vodafone Group Public Limited Company (VOD), highlighting its undervalued status and growth potential. Despite a perception of being a stagnant telecom, Vodafone’s stake in AST SpaceMobile and Sat-co JV could drive significant growth. European coverage by 2026 is expected. Vodafone’s valuation does not reflect this potential.

The market continues to view Vodafone as a low-growth stock, ignoring its exposure to AST SpaceMobile and Sat-co JV. Sat-co’s direct-to-device broadband and voice connectivity could significantly boost Vodafone’s earnings and free cash flow. With European coverage expected by 2026, there is potential for a major re-rating in Vodafone’s valuation.

Vodafone’s strategic position in the upcoming European S-band spectrum allocation, rising defense spending, and preference for sovereign-controlled infrastructure provide a clear advantage over competitors. Sat-co’s potential to drive over €1bn of incremental EBITDA for Vodafone could lead to a significant multiple re-rating. Vodafone’s satellite connectivity catalyst remains underappreciated by the market.

While Vodafone is not among the 30 most popular stocks among hedge funds, 26 hedge fund portfolios held VOD at the end of the third quarter. Uzo Capital believes in Vodafone’s investment potential but sees greater upside potential and less downside risk in certain AI stocks. For investors seeking an undervalued AI stock with significant growth potential, Uzo Capital suggests exploring their free report on the best short-term AI stock.

Read more at Yahoo Finance: Vodafone Group Public Limited Company (VOD): A Bull Case Theory