Up 40% this year, can the Vodafone share price keep going?

Telecoms company Vodafone (LSE: VOD) had often seemed unloved by stock market investors in recent years. Things have certainly turned around in 2025 though, with the Vodafone share price moving up by 40%.

That still leaves it 22% below where it stood five years ago (and over 80% below where it stood back in 2000!).

But this year’s strong momentum has not come out of nowhere. I reckon there are some clear reasons behind it. So ought I to invest now in the hope of further growth in the Vodafone share price over the coming year and beyond?

Dividend growth’s back, but from a lower base

Vodafone cheered investors this year by announcing its first dividend increase in many years. However, that comes on top of a painful dividend cut last year. That has happened on multiple occasions over the past couple of decades.

So what does the company’s dividend policy signal to investors? Seen positively, a growing dividend and apparent financial discipline could be seen as positive factors for the share. The current dividend yield of 4.2% is well above the FTSE 100 average.

Longer term though, Vodafone’s dividend per share is now a shadow of what it once was. That underlines the challenging economics of the telecom business, with large licensing and infrastructure costs often eating heavily into operating profits.

Mobile money remains a strong story

This year has seen the Airtel Africa share price soar 179%. A lot of the excitement around that share has been because of its African-focused digital payments business.

But Airtel Africa is not the only FTSE 100 business with a large and growing mobile money business on the continent. Vodafone has a large footprint here with a sizeable customer base across multiple countries where it is also looking to grow its mobile money business.

In the first half of this year, Vodafone had 94m financial services customers in Africa. Weakening currency rates ate into revenue growth when translated from local billing currencies to the euro (Vodafone’s financial reporting currency). I see that as an ongoing risk for Vodafone and we have seen it challenge Airtel Africa’s ops too.

Expressed in euros, Vodafone’s African business revenues in the first half grew 7% year-on-year. I actually see that as fairly unimpressive given the scale of the opportunity, the growth opportunities in the market and Vodafone’s competitive advantages that ought to help it capitalise.

If the company can succeed in doing that and prove its mobile money operation has substantial ongoing growth potential, I think that could propel the Vodafone share price higher in 2026.

A mixed bag

As an investor, I continue to have mixed thoughts about Vodafone. I like its strong position in many European and African markets, its proven cash generation potential, and the size of the mobile money opportunity.

But the company’s net debt grew in the first half and the long-term dividend record has been disappointing.

Still, the share price has the wind in its sails and I see some reasons for ongoing optimism. The business has a number of substantial strengths I think could potentially justify a higher valuation. I regard it as a share investors should consider.