Vodafone - reinvest or take dividends?

rinnin

Hi everyone,

Like a lot of naive first time investors I got caught up in the government hype / rip off of investing in Telecom Eireann back in the day (which later became Eircom, dived & we got a few table scraps for our investment) by ending up with a huge loss (about 65% now) and a few Vodafone shares for our troubles.

I've held onto these Voda shares since and have been receiving dividends. Now I see we can partake in a share buy back programme instead of receiving dividends in their so called Dividend Reinvestment Plan ("DRIP").

Was just wondering what people thought about this plan & what the consensus was about reinvesting or continuing as normal?
(Of course the main goal would be trying to get back what I reinvested in the day but might be waiting a lifetime for that).
Thanks

Raskolnikov

It makes sense to reinvest dividends into shares if you believe that the company is undervalued. Personally, I don't think Vodafone look particularly cheap. With revenue falling, I am also a little sceptical of the dividend rate staying as high as it.

shamblertine

with the iPhone now being available with Vodafone, earnings are likely to explode.............unless this info has already been completely factored into the price

Bullish

I would not see vodaphone now offering the Iphone as a reason for earnings to explode, It may help stem the bleeding

lucky-colm

its a bloody phone people

its not like vodafone invented the bloody thing

vodafone and every second high street shop will be selling them in a few weeks

its hardly going to be the cause of the company sinking or swiming

Bullish

I agree colm, I was just making the point that "some" people were leaving and going to O2 because of the fad and possibly this will stop...... I dont see an earnings explosion... Give it a few months and there will be a new phone on the market and I phone will be binned

rinnin

So basically I'm damned if I do & damned if I dont. :rolleyes:
Thanks y'all.
Might just stick with the dividends for the time being. At least I have till 15th Jan to decide.

shamblertine

lucky-colm wrote: »

its a bloody phone people

its not like vodafone invented the bloody thing

vodafone and every second high street shop will be selling them in a few weeks

its hardly going to be the cause of the company sinking or swiming

I was exaggerating with the earnings explosion comment, but still you shouldn't underestimate the effect the iPhone will have. Sales of the latest iPhone have been amazing, they literally can't make it fast enough, and this is for a 500 quid luxury product in the middle of a recession.

Bullish

Sorry Rinnin,
I got a little off topic, Personaly I like to reinvest dividend.. but it depends on your personal circumstances..IMO
Also your outllook on the company
has it room to grow earnings ..... Do your own research
regards

DERICKOO

Vodafone has grown and grown, and is today one of the biggest companies in the world, with extensive interests across Europe, the United States and now India, Turkey, Egypt and other fast-growing emerging markets. Europe, meanwhile, seems to have become as mature as mature can be, with penetration rates in some countries of close to 100 per cent (yes, some people have two or more).Yet this is by no means the end. With new applications now arriving daily, it may indeed be only just the beginning. Here's to the next 25 years. However you imagine the future, Vodafone is likely to be a big part of it.