Europe is one of the most hated regions in the world by investors. Within Europe the most reviled sector is telecom. Many stocks in this sector sport double digit free cash flow and dividend yields despite their utility like nature. It has been a lonely position of mine that this sector is simply too cheap. Vodafone is a very large position for me.
Today it seems that the richest man in the world, Carlos Slim, agrees with me as he offered to buy $3.5 billion worth of Dutch telecom company KPN's stock. This would give him a toehold in the European telecom market. This follows Li Ka Shing's (the richest man of Asian decent) reportedly unsuccessful bid for an Irish telecom company in recent days. It does not surprise me that two of the richest men in the world are buying the most reviled sector. That is why they are rich.