Income Investor Alert: Thanks To The Brexit Shock, This Telecom Now Yields 10%

Britain's decision to walk away from the European Union has shocked investors, and the Brexit will continue to be a hotly discussed subject for the foreseeable future. The referendum has thrown global financial and currency markets into disarray on Friday, with stocks in Europe and the U.S. selling off sharply. The market slump after Britain's referendum reflects deep uncertainty that is likely going to weigh on stocks for a while longer. European equities were hit very hard on Friday, and much harder than U.S. equities. While I can understand the anxiety investors feel over the Brexit, the referendum is also a big buying opportunity, and especially for European equities.

Take a look at Spanish telecom Telefonica, S.A. (NYSE:TEF) whose shares were getting clobbered at the end of last week. I have rarely seen a large European telecom lose ~18 percent of its equity value in a single day. The question, though, is, does this market meltdown make much sense? The Telefonica meltdown is just one example of how quick investors were to sell stocks. However, as I have now contended multiple times, the Brexit-induced market sell-off includes a HUGE emotional element. And experienced investors know that emotionally-fueled market corrections are always a good opportunity to load up on beaten down shares. And that's especially true for a company like Telefonica which will continue to offer telecom services all around the world, including Europe, Brexit or no Brexit.

Source: Seeking Alpha

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