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Mid February 2021: My 12m PT for TPG = $7.77, however over 3 years (i.e. by late Feb 2024) I reckon they'll be trading at over $9/share. [I hold TPG shares.]

27-Mar-2021 - Update - the above was written by me about 6 weeks ago, and something has changed since then, and that something is that yesterday (26-Mar-2021) David Teoh announced he had quit TPG effective the day before (Thursday 25-Mar-2021), and his son Shane was leaving also (also effective from Thursday). However, his other son, Jack, was staying on at TPG - for now. David Teoh and his wife Vicky have two other sons also, Bob & John, however it is understood that neither currently work for TPG. All of his sons have been involved in a number of start-ups and other business ventures with their father, and David looks set to be about to start up something else - as suggested near the end of his letter that was published with the TPG announcement on the ASX site yesterday - here is the full letter:

25 March 2021

Dear fellow shareholders,

I am writing this letter to give you some personal insight into my decision to resign as a director and chairman of TPG Telecom. Many of you have been with me on this journey for a very long time and I have been humbled by your support and belief in our vision for the company.

When Vicky and I started our business more than 30 years ago, we had little more than ambition.

We were lucky. Australia provided us with an environment in which, with hard work and perseverance, we were able to build a company that now provides services to millions of Australians and has a remarkable suite of assets.

I am proud and humbled to have led the company from its founding, through its exciting growth over the years, and most recently into its merger with Vodafone Hutchison Australia. There have been many challenges along the way, but I firmly believe that consumers in Australia have greatly benefited from TPG’s competitive business approach, and that they will continue to do so.

TPG Telecom is now a full-service telecommunications provider and home to some of Australia’s most loved brands including Vodafone, TPG and iiNet. It owns and operates nationwide mobile and fixed networks, has over five million mobile customers and two million fixed broadband customers, and employs close to six thousand people. I have been fortunate to have worked with many excellent colleagues, without whom success would have been much more challenging. I thank them all for being part of such an incredible journey.

Following the merger last year, we have come together better and faster than expected. The newly merged company has performed well and has strong, clear strategic priorities to drive growth and long-term shareholder value. This is only the beginning for TPG Telecom. I would like to thank my fellow directors, Iñaki Berroeta, the Executive Team and everyone at TPG Telecom.

Your new Chairman, Mr Canning Fok, is one of the most capable business leaders in the world and has led a global conglomerate of businesses for several decades. I am confident that Canning, Iñaki and the Board will continue to create a strong and sustainable future for our company.

As such, now is the right time for me to step aside and pursue other interests.

Thank you for your support over the years, and I hope that you will continue to support the company, its new Chair and the entire TPG Telecom team.

Best wishes,

David Teoh

--- ends ---

So, stepping aside to pursue other interests. Fair enough. I sold all of my TPG shares immediately and also removed them from my Strawman.com scorecard yesterday. The bulk of my investment thesis around TPG Telecom being worth more than where they were trading (which was around the $7 mark at the time) was based around David Teoh's leadership and what he had achieved thus far, and his vision for TPG into the future. Without him, TPG is to me very much harder to build a strong bull case around. So - I'm out. I'll now rotate that money into something that I have stronger conviction in, because I no longer have any strong conviction in TPG Telecom.

I think it goes lower in the near term as the ramifications of Teoh leaving are digested and understood by the analysts and brokers out there and the updated broker calls and price targets flow through. I'm not saying TPG won't be higher in the future. They might well be. However, I can't build a strong case any more around why I think they will be higher, so I've moved on.

27-Sep-2021: UPDATE: OK, above (6 months ago on 27th March) I wrote, "...I think it goes lower in the near term..." Yep, sure did, from $6.41 down to $4.91 on May 24th. A drop of -23.4%. However, the trend then reversed and it's been heading NE at a good clip since that day in May. Currently $6.92. I could have jumped back on when they established that uptrend, but I'm still not keen. TPG without Teoh is like... Amazon without Bezos, Virgin without Branson, Facebook without whatshisface, Guns 'n Roses without Slash... not the same thing at all... in fact, an entirely different proposition.

TPG is now being run by the old Vodafone Hutchinson team really, with Teoh off running Tuas (TUA). His son Shane also left at the same time that David did. David's other son, Jack, is still on the board of both TPG and Tuas, but I do not know if he has any day-to-day involvement other than his duties as a non-executive director.

Vodafone was a basket case here in Australia, and it made sense for Teoh to buy it to get his hands on an already-built mobile network for TPG, the one thing TPG did not have already in their Telco arsenal. However, it ended up being like Vodafone took over TPG, at least in terms of who is running the company now.

For more on the split (Teoh leaving) - see here: https://www.afr.com/companies/telecommunications/teoh-son-quit-tpg-board-20210326-p57e9g

Anyway, while TPG is certainly in a nice uptrend currently, I don't think they've got the management that they used to have (well they clearly haven't) and they don't now deserve a quality premium that Teoh did deserve when he was running TPG. So, I am prepared to raise my price target to $6.50, and I reckon they may even go to $7, but I also think there is a fair bit of downside risk that the current people running TPG stuff it up somehow and the market marks them down again. In short, I don't have enough confidence in their management to invest in the company at this point, even though I acknowledge that they may well go higher in the near-term from here. I would be surprised if they got back to that $8 level they hit in November (2020). They are just not that good now, IMO.

By the way, I feel the same way about Telstra. With the right management TLS could be a worthy investment, but I do not think they have management at this point that I could back. I don't think they are serious enough about addressing their largest issues, and one of the main ones is their poor customer service. They always talk about improved customer service, but the unhappy Telstra customers still always seem to outnumber the happy ones. So many people are that pissed off with Telstra that they would switch in a heartbeat if they could get the same speed and coverage. Usually you can, if you look around, so the way I see it, Telstra have got everything to lose, and they're going the right way about losing it. TPG aren't that bad, yet, but give them time...

18-Sep-2022: Update: Lowering my PT for TPG to just over $4. They look like they're going lower, and I don't see too much going for them now that is going to turn that momentum around in the near-term.

Tuas (TUA) looks better, but I'm not in either TPG or TUA at this point: