The European telecom sector could be a good place for investors to park their cash, particularly Deutsche Telekom and UK's Vodafone, James Bevan, chief investment officer at CCLA Investment Management, told CNBC Friday.
Investors want to see underlying value rising and the sector offers just that, because it has a stable customers base and there was less of a bubble in telecoms, Bevan said.
"If investors look at the European Telecom sector, they can see some very interesting divergence of price and value, which I think represents an excellent buying opportunity at current levels," he said.
The sector offers free cash flow yields of about 14 percent, exposure to fast-growing emerging markets, which make up around 20 percent of telecom profits, a relatively low input from commodities prices at only around 5 percent, and a relatively constant number of customers, Bevan said.
"We know people carry on making telephone calls," he said.
He added that he was bearish on the autos and capital goods sectors.