The fortunes of former Eircom shareholders who have Vodafone stocks may yet take a turn for the better.
JP Morgan today raised its stance on Vodafone to a 'buy' from 'market outperform' - albeit with a price target of 135 pence - after its 38 per cent share price fall over the last four months.
It believes the stock is oversold and now is a good time to buy, since there is 20 per cent upside potential to the share price now, and the shares are not likely to fall further.
JP Morgan cut back its target to 135 pence from 170 - partly due to its new valuation system, but also based on an expected increase in free cash flow yield and 8.6 per cent revenue growth.
It believes Vodafone will achieve a free cash flow of £1.6 billion sterling in 2002, which will have grown to £4.8 billion sterling by 2005.
Meanwhile, Goldman Sachs kept Vodafone on its 'recommended list' after yesterday's figures were in line with its forecasts.
Vodafone shares had a rollercoaster ride yesterday after weak Key Performance Indicators compounded losses sparked by the recent disappointing subscriber numbers from US joint venture, Verizon and J-Phone's delay to 3G launch.
AFP