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VimpelCom Is Trading below Moving Averages in 2015

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VimpleCom’s price movement

VimpleCom (VIP) has a market cap of $6.2 billion. After the company’s 3Q15 earnings report, its stock fell by 5.1% to close at $3.52 on November 6, 2015. The stock’s price movements on weekly, monthly, and YTD bases are -6.9%, -15.2%, and -15.8%, respectively.

Technically, the stock has broken its support level and is trading below all moving day averages in 2015. Currently, it’s trading 10.1% below its 20-day moving average, 17.6% below its 50-day moving average, and 30.5% below its 200-day moving average.

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The SPDR S&P Russia ETF (RBL) invests 1.2% of its holdings in VimpelCom. The ETF tracks the S&P Russia Capped BMI Index, a market cap–weighted index of publicly traded stocks based in Russia. The YTD price movement of RBL was 16.8% as of November 5, 2015. The VanEck Vectors Russia ETF (RSX) invests 0.74% of its holdings in VimpelCom.

VimpelCom’s (VIP) competitors and their market caps are listed below:

  • Orange SA ADR (ORAN)—$47.4 billion
  • Telecom Italia SpA ADR (TI)—$23.9 billion
  • TELUS Communications Company (TU)—$18.9 billion
  • Mobil’nye Telesistemy PAO ADR (MBT)—$6.5 billion

VimpelCom’s performance in 3Q15

The company reported 3Q15 net revenue of $2,442.0 million, a fall of 31.1% when compared to net revenue of $3,544.0 million in 3Q14. Its operating income fell to -$480.0 million in 3Q15 as compared to operating income of $873.0 million in 3Q14, and the number of mobile customers fell by 0.76% in 3Q15 as compared to 3Q14. The company’s net income fell to -$970.0 million in 3Q15 as compared to its net income of $23.0 million in 3Q14.

Meanwhile, VimpelCom’s cash and cash equivalents fell by 6.9% in 3Q15 on a quarterly basis. Its current ratio rose to 0.93, and its long-term debt-to-equity ratio fell to 2.0 in 3Q15 as compared to the current ratio and long-term debt-to-equity ratio of 0.83 and 3.4, respectively, in 2Q15.

The company has appointed Alexander Matuschka as group chief performance officer, Bart Morselt as head of investor relations, and Dr. Stephen Collins as chief corporate and regulatory affairs officer.

VimpelCom and CK Hutchison Holdings have entered into an agreement to form an equal joint venture that will own and operate telecommunications businesses in Italy.

About VimpelCom

VimpelCom is an integrated telecommunications service operator providing voice and data services through a range of traditional and broadband mobile and fixed technologies.

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