Berenberg stays at 'hold' on Vodafone, trims target price

Analysts at Berenberg reiterated their recommendation to 'hold' shares of Vodafone, arguing that the choice of Margherita Della Valle as the company's new chief executive officer reduced the risk of a dividend cut or of a warning on capital expenditures.

In particular, they noted how during her time as finance chief she had defended both the dividend and Vodafone's German capex envelope.

However, operational and organic improvements took time and revenues in Germany, Italy and Spain were seen falling over the next two years.

Hence, the analysts trimmed their target price from 100.0p to 95.0p.

They also believed that Vodafone Italy's €2.5bn of goodwill would be written down in the full-year results due out on 16 May, and that of other operations possibly as well.

On the flip-side, they said there was scope for positive developments on the M&A front.