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of vodafone (LSE:VOD) share value has had an important 12 months in 2025. It is up 44% within the final 12 months, simply outperforming different shares. FTSE100. Nonetheless, the 96p stage stays effectively beneath historic ranges, and the share value might rise additional subsequent 12 months. Based mostly on my analysis, this is my outlook on the inventory:
Construct on a powerful basis
First, we have to look again at why shares have outperformed this 12 months. That is largely as a result of in depth restructuring efforts which were underway over the previous a number of years. The corporate continues to make significant enterprise transformations, lowering unperforming property and enhancing capital allocation. This consists of the sale of non-core companies and a discount in internet debt of roughly £9.7bn. Because of this, this initiative has considerably strengthened our steadiness sheet and improved our monetary place. Traders are clearly impressed with the execution, which is driving the share value increased.
One other main impetus was the merger with Three UK that occurred in the summertime. The mixed firm would be the UK’s largest cellular operator with roughly 30 million prospects. This not solely helps enhance future profitability, but in addition presents nice potential for future effectivity. Combining experience and assets could make an enormous distinction.
Elements supporting progress in 2026
Final month, the corporate introduced it might improve its dividend for the primary time since 2019. This led to an enchancment within the earnings outlook. The present dividend yield is 4.08%, increased than the FTSE 100 common of three.06%. If this accelerates additional, it’s more likely to appeal to revenue buyers.
Enhancements within the diversified enterprise additionally result in a constructive outlook for 2026. Vodafone’s footprint is presently targeted on high-growth areas reminiscent of Africa and components of Asia. However even when subsequent 12 months’s outcomes are weaker (which I doubt), the corporate might nonetheless carry out effectively in its core European markets. This diversification helps keep earnings momentum and hold buyers excited.
In fact, there are dangers to beat subsequent 12 months. Earlier this month, Ofcom introduced an investigation into the summer season outage. This might prolong till 2026, and relying on what’s revealed, there might be reputational injury and fines.
Purpose for progress
Based mostly on the present value of 96p, I feel Vodafone’s share value might attain 127p subsequent 12 months. Subsequent 12 months’s earnings per share forecast is presently 0.07p. The typical value/earnings ratio for the FTSE 100 is eighteen.2. So, utilizing the anticipated earnings and multiplying by 18.2, the potential share value is 127p.
This can be a practical value goal for Vodafone over the subsequent 12 months, and I feel it is an possibility buyers ought to think about. If income exceed expectations, the inventory value might rise additional. Nonetheless, there’s additionally the chance of surprising prices, so optimism ought to be tempered by being practical.