Vodafone Shares Hit 52-Week High on Goldman Sachs Double-Upgrade

Vodafone (VOD) shares rose more than 2.0% in trading, reaching a new 52-week high after Goldman Sachs executed a significant double-upgrade on the stock, shifting its rating from 'Sell' directly to 'Buy'. The move signals a major reversal in sentiment from one of the stock's most prominent former bears.

Analyst Reassessment Drives Rally

In a note to clients, Goldman Sachs analyst Andrew Lee raised the firm's price target on Vodafone shares to 155 pence from a previous 85 pence. The bank now projects that Vodafone's relative return on invested capital will improve to above the sector average over the next three years.

Goldman Sachs attributed this optimistic outlook to two key factors:

• The anticipated "repair" of the UK mobile market.
• A more aggressive cost-reduction program being implemented by the company.

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Notably, Goldman's estimates for Vodafone have moved above the consensus for the first time in several years. The upgrade was reinforced by a separate move from Morgan Stanley, which raised its own price target on Vodafone to 125 pence from 115 pence, while maintaining an 'Equalweight' rating.

Market Impact and Context

The positive analyst actions pushed Vodafone shares to an intraday high of 125.15p, a level not seen in over a year. The stock's advance was particularly noteworthy as it occurred while the broader FTSE 100 index was trading lower, indicating the gains were driven by company-specific news rather than general market momentum.

The upgrades follow a recent announcement from Vodafone's VodafoneThree subsidiary, which unveiled a new television and entertainment platform. The new offering, designed to compete with Sky, BT, and Virgin Media O2, had already provided the shares with positive momentum leading into the session.