How much money you would have if you invested R1,000 in Vodacom, MTN, and Telkom in 2024

A R1,000 investment in Cell C’s largest shareholder in early 2024 was worth substantially more at the end of the year than the same investments in Vodacom, MTN, and Telkom.

Blue Label, which owns 49.5% of Cell C, recorded the biggest increase in share price of any major JSE-listed telecoms company in 2024.

A Blue Label share cost R3.88 at the opening of the JSE on 2 January 2024. By the close of the market on 12 December 2024, the price stood at R5.82, a 50% jump.

That means if you bought R1,000 in Blue Label shares at the start of the year, they would be worth around R1,500 in mid-December.

Investor sentiment appeared to improve despite Blue Label not posting particularly tremendous results in 2024.

The company’s financial reports also remain notoriously complicated and difficult to understand.

Although its revenue and gross profit decreased, net profit after tax increased from R269 million to R647 million, while earnings per share, headline earnings per share, and core headline earnings per share also jumped.

While Cell C’s financial performance has improved slightly, it is still a major albatross around Blue Label’s neck, with a R2.3-billion loss in its last financial year.

Despite Cell C’s issues, Blue Label’s share price has increased roughly 117% in the past five years.

However, it reamins far off its peaks of more than R20 per share in September and October 2016.

When assessing its share price performance, one should consider that it is coming off a low base in the past few years and is a small-cap share.

It could be more susceptible to a big price swing even with a relatively small volume of trades.

Telkom’s share price also performed commendably, climbing from R28.90 on 2 January to R35.55 by 12 December, a 23% jump.

Following the publication of its interim results for the six-month period ended September 2024, several prominent analysts said the company could give investors good returns if it continued executing its successful strategy.

Telkom’s fixed business performed particularly well, while its mobile division has also shown steady revenue growth.

“It looks like Telkom is winning market share in the mobile space,” said Nitrogen Fund Managers’ Rowan Williams. “Their numbers were much better than Vodacom and MTN’s.”

Investors who poured their money into South Africa’s two biggest telecoms companies would be worse off than at the start of the year.

Vodacom’s share price has dropped slightly lower than it was at the start of the year.

In the first half of 2024, its share price slumped as revenue struggled with consumer spending under pressure.

Its financial performance improved slightly in the second half of the year, and there were strong indications that the Competition Tribunal would approve its big fibre deal with Vumatel and DFA owner CIVH.

During the year, Vodacom’s share price peaked at roughly R114 in August 2024.

However, to much of the industry’s surprise, the Competition Tribunal blocked the fibre deal at the end of October 2024.

That appeared to hurt Vodacom’s share price, which dropped back down to similar levels to where it was trading at the beginning of 2024.

MTN’s share price has endured huge pain in the year, and it is not difficult to spot the biggest culprit in its struggles.

While its headquarters are in South Africa, the company’s largest market by customers and revenue is Nigeria.

That country’s currency — the Naira — has taken a beating in the past two years.

Despite MTN’s revenue in Nigeria increasing in Naira, it was down in rand, the currency in which it reports its financial results.

For example, in the interim period ending June 2024 its revenue in Nigeria was up 32.4% on constant currency basis but declined 52.9% in rand.

With its share price plummeting 25.5% in the year, R1,000 in MTN shares bought on 2 January would be worth R745, a decline of R255.

The table and charts below summarise the changes in the share price of South Africa’s four big JSE-listed telecoms companies between 2 January 2024 and 12 December 2024.