TalkTalk rallies on Barclays upgrade to 'overweight'

23rd Aug 2018 10:51

(Sharecast News) - TalkTalk surged on Thursday as Barclays upped the stock to 'overweight' from 'equalweight', saying operating trends look set to improve.In a broader note on European telecom services, the bank said: "After years of incumbents squeezing challengers and promoting network advantage, we believe the balance of power is now swinging back towards challengers. We see challengers increasingly having more effective tools with which to profitably fight back, jeopardising incumbent retail and wholesale businesses."It said that while TalkTalk has suffered market share losses in the past few years, negative earnings momentum, and rising leverage, 12 months on from its strategy 'reset', Barclays sees a return to top-line growth with its and consensus earnings estimates appearing to have bottomed.Barclays has a 150p price target on TalkTalk.Back in July, the company posted a 4.1% jump in first-quarter revenue to £382m as it added 80,000 net broadband customers, taking the total to 4.22m. This was down from the 109,000 it added in the final quarter of the previous year but up from the 20,000 added in the same quarter of last year and TalkTalk said it was on track to add another 150,000 new customers this year.At 1015 BST, the shares were up 8.4% to 133.97p.