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(Sharecast News) - Berenberg has raised its target price for Vodafone from 123p to 140p and reiterated a 'buy' rating, saying the stock remains "relatively cheap" compared with the wider European telco sector.
The broker attributed the improved outlook to July's first-quarter results from the telecoms giant that came in at the upper end of guidance, driven by strong growth at Vodacom and in Germany.
Analysts said the company is at a free cash flow inflection point, and is expected to deliver sustainable FCF and dividend growth over the coming years, from the reported 2.62bn in FY26.
The company also has "substantial future capacity for value-creation opportunities", they said, with further share buybacks and small bolt-on M&A deals possible from FY28 onwards.
Berenberg said that Vodafone's UK capital markets day on 8 October could be a catalyst for the stock, saying: "Potential German telecom consolidation is one of the most likely 'in-market' sector deals."
"On 10 July 2026, Vega (owned by the Xavier Niel family) acquired a c16% share of the voting rights in Vodafone from Etisalat, and later raised its stake to c19%. We wonder if Mr Niel's involvement increases the likelihood of Vodafone looking to acquire 1&1, driving German consolidation," the broker said.
Analysts at Jefferies have hiked their target price for UK-listed TT Electronics from 110p to 175p, but kept a 'hold' recommendation on the electronic components and sensors manufacturer.
The broker said that the company has made "encourging operational progress" and volume recovery, as shown in its interim results last month, but there is "still more to do".
TT reported materially improved profitability, margin expansion and stronger commercial momentum in the first half, reflecting the restructuring and operational improvement programme launched last year.
Actions taken included: making the loss-making Cleveland EMS site profitable in the first half, closing the loss-making Plano Components site, and restructuring the group into three product-led divisions (Power, EMS and Components).
"There remains more to be done in 2H26F, and beyond, in order to improve operational efficiency, realise cost reductions, and capitalise on end market improvements," Jefferies said.
"We incorporate the updated guidance into our forecasts, reiterate our 'hold' recommendation, and increase our PT to 175p."