Telecommunications stocks have taken a beating of late. But Michael Kovacocy of Daiwa Institute of Research Europe says steep price dives has pushed telecom shares into "deep value territory." He offered CNBC his insights — and favorite stock plays.
"Just as with other sectors, telecoms have had a rough year," said Kovacocy. The global economy's "macro problems have started to impact them."
Further, he notes that the "mobile" telephone market in Europe is "very mature" and has "shown some problems." But he says these issues are sowing the seeds of future value for certain names.
Telefonica: Kovacocy's No. 1 pick is "very solid," he says, thanks to its "great geographic diversification," particularly across Latin America. He also likes Telefonica for its high dividend yield, a safety net likely to attract share buyers and holders through lean times.