{"id":28272,"date":"2012-03-15T08:22:46","date_gmt":"2012-03-15T12:22:46","guid":{"rendered":"http:\/\/countingpips.com\/fx\/2012\/03\/15\/turkcell-strong-growth-on-data-plans\/"},"modified":"2012-03-15T08:22:46","modified_gmt":"2012-03-15T12:22:46","slug":"turkcell-strong-growth-on-data-plans","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/fx\/2012\/03\/15\/turkcell-strong-growth-on-data-plans\/","title":{"rendered":"Turkcell: Strong Growth on Data Plans"},"content":{"rendered":"

By The Sizemore Letter<\/a><\/p>\n

Last month, we reported that the struggle for control of Turkcell\u2019s (NYSE: TKC)<\/strong> board of directors was entering the last innings of what had proven to be a very<\/em> long ballgame (see \u201cTurkish Telecom on Brink of Big Move<\/a>\u201d).<\/p>\n

Alas, we have nothing new to report on this drawn-out pitcher\u2019s duel.\u00a0 The case is still bouncing around the court system of the old British Empire, and nothing definitive has been decided.\u00a0 I do expect a resolution\u2014and soon.\u00a0 But I also learned that it might be best not to hold my breath.<\/p>\n

\"\"<\/a><\/p>\n

In the meantime, life goes on, and Turkcell continues to expand and thrive as one of the premier emerging market telecom providers.\u00a0\u00a0 The company released earnings late last month,\u00a0 and results were mostly strong.\u00a0 Revenues grew 4% in what was a very difficult year for Turkey and emerging markets in general, and Turkcell\u2019s subscriber base grew by 1.1 million to 34.5 million users.\u00a0 The company expects 2012 revenues to grow by more than double the 2011\u2019s rate, driven by the increased popularity of data and mobile internet plans.<\/p>\n

Earnings took a hit, however, falling 33% due to a currency crisis in Belarus, where Turkcell has significant assets.\u00a0\u00a0 (Yes, this is the downside of investing in emerging markets;\u00a0 while the potential for growth is enticing, it\u2019s not all sunshine and roses.\u00a0 Little things like currency devaluations can and do happen.)<\/p>\n

Interestingly for shareholders, while no decision has been made on the reinstatement of the dividend\u2014which has not been paid in over a year due to the boardroom dispute\u2014CEO Sureyya Ciliv suggested that a share buyback could be in the works for July of this year.<\/p>\n

I\u2019ve made my case for several months now: even if Turkcell\u2019s boardroom power struggle continues indefinitely the company is attractive as a play on rising incomes in Turkey, the Middle East, and Eastern Europe.\u00a0 It is a fantastic investment in what I consider to be the biggest macro trend of the next decade: the rise of the emerging market consumer.<\/p>\n

When you add to this powerful macro trend shareholder-friendly moves like the reinstatement of the dividend and the potential for substantial share buybacks, you have the ingredients in place for spectacular returns.\u00a0 This was my rationale for making Turkcell my pick in the InvestorPlace \u201c10 Stocks for 2012<\/a>\u201d contest, and it continues to be my rationale today.<\/p>\n

When the board drama is resolved, I expect the shares to pop.\u00a0 But in the meantime, life goes on.<\/p>\n

Turkcell recently won the award for \u201cBest New Product\u201d at the 2012 Global Mobile Awards for its Click to Talk application, which enables its users to place phone calls from within Facebook.\u00a0\u00a0 The company was also nominated for two other awards, \u201cBest Mobile Money Innovation\u201d and \u201cBest Technology Product or Solution for Serving Customers.\u201d<\/p>\n

You could feel Mr. Ciliv\u2019s pride when he said in response, \u201cTurkcell, which is an innovation leader in technology in Turkey, has once again proven with this award that it has the skills to sign global firsts and bests\u2026 \u00a0We are working hard for Turkey to become a country that produces technology, rather than imports it, and we are pleased to see that our efforts bear fruit.\u201d<\/p>\n

Turkcell is a world-class company trading at a very reasonable price.\u00a0 Take advantage of the buying opportunity presented by the boardroom fiasco to accumulate shares of this leading emerging market innovator.<\/p>\n","protected":false},"excerpt":{"rendered":"

By The Sizemore Letter Last month, we reported that the struggle for control of Turkcell\u2019s (NYSE: TKC) board of directors was entering the last innings of what had proven to be a very long ballgame (see \u201cTurkish Telecom on Brink of Big Move\u201d). Alas, we have nothing new to report on this drawn-out pitcher\u2019s duel.\u00a0 … <\/p>\n

Continue reading “Turkcell: Strong Growth on Data Plans”<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-28272","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/28272","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/comments?post=28272"}],"version-history":[{"count":0,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/posts\/28272\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/media?parent=28272"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/categories?post=28272"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.investmacro.com\/fx\/wp-json\/wp\/v2\/tags?post=28272"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}