July 13 (Bloomberg) -- Magyar Telekom Nyrt., Hungary’s former phone monopoly, headed for a fourth week of declines after announcing yesterday that it will increase prices as a result of “unfavorable economic and market processes.”
The shares of the company, controlled by Deutsche Telekom AG declined as much as 0.5 percent and traded 0.2 percent lower at 430 forint by 10:47 a.m. in Budapest. The stock has weakened 0.7 percent this week, extending the longest streak of weekly declines since August 2011.
Hungarian telecommunications companies, which also include units of Vodafone Group Plc and Telenor ASA, have to pay a new tax on phonecalls from this month. The price increase announced by Magyar Telekom yesterday doesn’t compensate for the tax, which will cut the company’s earnings, Gergely Palffy, a Budapest-based analyst at KBC Groep NV’s broker unit, wrote in a research report today. He has a hold rating on the stock.
Vodafone and Telenor indicated they would pass on the costs at least for this year to customers, Palffy wrote.
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