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Deutsche Telekom (DTEGY)
OTHER OTC:DTEGY
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Deutsche Telekom
(OTC:DTEGY)
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Rating:74Outperform
Price Target:
$36.00
â–²(12.32% Upside)
Deutsche Telekom's overall score is driven by strong earnings call performance and reasonable valuation, despite technical indicators suggesting potential bearish momentum. Financial performance is solid but impacted by high leverage and revenue growth challenges.
Positive Factors
AI Initiatives and Partnerships
The partnership with NVIDIA to launch an industrial AI cloud enhances Deutsche Telekom's digital capabilities, positioning it as a leader in AI-driven solutions. This strategic move is likely to drive innovation and efficiency, offering a competitive edge in the telecommunications market.
Fiber Expansion in Europe
The expansion of fiber-to-the-home (FTTH) infrastructure strengthens Deutsche Telekom's network capabilities, improving service quality and customer satisfaction. This investment supports long-term growth by increasing market penetration and enhancing competitive positioning.
T-Systems Growth
T-Systems' strong EBITDA growth, driven by AI and cloud services, underscores Deutsche Telekom's success in diversifying its revenue streams. This growth reflects the company's ability to capitalize on digital transformation trends, supporting sustained profitability.
Negative Factors
High Leverage
Deutsche Telekom's high leverage, as indicated by its debt-to-equity ratio, poses financial risks. This level of debt can limit financial flexibility and increase vulnerability to economic downturns, potentially impacting long-term financial stability.
Challenges in German Market
The decline in growth within the German market highlights competitive and economic challenges. This could hinder Deutsche Telekom's domestic performance, affecting overall revenue growth and necessitating strategic adjustments to regain market strength.
Broadband Net Additions in Germany
Losing broadband customers in Germany indicates competitive pressures and market saturation. This trend could impact Deutsche Telekom's ability to grow its customer base and maintain revenue levels in its home market, necessitating strategic responses to counteract these challenges.
Deutsche Telekom (DTEGY) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$161.60B
Dividend Yield3.06%
Average Volume (3M)496.31K
Price to Earnings (P/E)12.2
Beta (1Y)0.20
Revenue Growth5.54%
EPS Growth104.78%
CountryUS
Employees198,194
SectorCommunication Services
Sector Strength97
IndustryTelecommunications Services
Share Statistics
EPS (TTM)0.64
Shares Outstanding4,905,190,400
10 Day Avg. Volume316,086
30 Day Avg. Volume496,313
Financial Highlights & Ratios
PEG Ratio-0.35
Price to Book (P/B)2.25
Price to Sales (P/S)1.20
P/FCF Ratio6.87
Enterprise Value/Market Cap1.70
Enterprise Value/Revenue2.29
Enterprise Value/Gross Profit5.63
Enterprise Value/Ebitda6.20
Forecast
1Y Price TargetN/A
Price Target UpsideN/A
Rating ConsensusN/A
Number of Analyst Covering0
EPS Forecast (FY)N/A
Revenue Forecast (FY)N/A
Deutsche Telekom Business Overview & Revenue Model
Company DescriptionDeutsche Telekom AG, together with its subsidiaries, provides integrated telecommunication services. The company operates through five segments: Germany, United States, Europe, Systems Solutions, and Group Development. It offers fixed-network services, including voice and data communication services based on fixed-network and broadband technology; and sells terminal equipment and other hardware products, as well as services to resellers. The company also provides mobile voice and data services to consumers and business customers; sells mobile devices and other hardware products; and sells mobile services to resellers and to companies that purchases and markets network services to third parties, such as mobile virtual network operators. In addition, it offers internet services; internet-based TV products and services; and information and communication technology systems for multinational corporations and public sector institutions with an infrastructure of data centers and networks under the T-Systems brand, as well as call center services. The company has 242 million mobile customers and 22 million broadband customers, as well as 27 million fixed-network lines. Deutsche Telekom AG has a collaboration with VMware, Inc. on cloud-based open and intelligent virtual RAN platform to bring agility to radio access networks for existing LTE and future 5G networks; and partnership with Microsoft to deliver high-performance cloud computing experiences. The company was founded in 1995 and is headquartered in Bonn, Germany.
How the Company Makes MoneyDeutsche Telekom generates revenue through several key streams, primarily from mobile and fixed-line telecommunications services. The company's main revenue sources include subscription fees from mobile and broadband services, as well as revenue from value-added services such as digital entertainment and cloud computing solutions. Additionally, Deutsche Telekom benefits from partnerships with other technology firms and service providers, enhancing its service offerings and expanding its customer base. The company's focus on innovation and investment in network infrastructure, including 5G technology, also plays a critical role in driving growth and increasing its competitive advantage in the telecommunications market.
Deutsche Telekom Earnings Call Summary
Earnings Call Date:Nov 13, 2025
(Q3-2025)
| % Change Since: |
Next Earnings Date:Feb 26, 2026
Earnings Call Sentiment Positive
The earnings call reflects a generally positive sentiment with significant achievements in growth metrics, strategic initiatives, and shareholder returns, despite some challenges in the German market.Q3-2025 Updates
Positive Updates
Consistent Growth Metrics
Deutsche Telekom delivered 3.7% organic service revenue growth, 4.4% organic EBITDA growth, 6.8% growth in free cash flow, and 9.5% growth in adjusted earnings per share for the first 9 months of 2025.
T-Mobile US Performance
T-Mobile US reported impressive Q3 results with a 9.1% service revenue growth and 5.6% core EBITDA growth. Postpaid net additions were 2.3 million, exceeding consensus expectations.
Dividend and Share Buyback
The Board of Management proposed an 11% dividend increase to EUR 1 per share for 2025 and plans to buy back EUR 2 billion worth of shares in 2026, amounting to a shareholder return of nearly EUR 7 billion.
Fiber Expansion in Europe
Deutsche Telekom passed 3.6 million additional European homes with FTTH in the last 12 months, reaching nearly 23 million homes.
Moody's Credit Rating Upgrade
Moody's upgraded Deutsche Telekom's credit rating to A3, recognizing the company's disciplined financial execution.
AI Initiatives and Partnerships
Deutsche Telekom launched Europe's first industrial AI cloud with NVIDIA, with a combined investment of EUR 1 billion, marking significant progress in AI-driven digitization.
T-Systems Growth
T-Systems reported 11.7% year-to-date EBITDA growth, benefiting from AI-driven digital solutions and sovereign cloud services.
Negative Updates
Challenges in German Market
Germany faced a weaker quarter with a headline growth decline of 1.8%, impacted by prior year comps and cost phasing including a double whammy from wage increases.
Broadband Net Additions in Germany
Deutsche Telekom suffered another small customer loss in Germany's broadband market, partly due to competitive pressures and weak German economy.
Company Guidance
During Deutsche Telekom's Third Quarter 2025 Conference Call, the company announced a 3.7% growth in organic service revenue and a 4.4% increase in organic EBITDA for the first nine months of the year. Free cash flow grew by 6.8%, and adjusted earnings per share rose by 9.5%. The company raised its guidance to reflect T-Mobile's improved performance, maintaining its full-year DT ex U.S. guidance. Deutsche Telekom has made strategic progress in Germany with a record fiber build and new AI-driven initiatives across Europe. T-Systems led with an 11.7% year-to-date EBITDA growth, while DT ex U.S. reported a 2.9% increase. The company announced plans to increase its dividend by 11% to EUR 1 per share for 2025 and buy back EUR 2 billion worth of shares in 2026, aiming for a shareholder return of nearly EUR 7 billion. Additionally, Deutsche Telekom passed 3.6 million additional European homes with FTTH in the past 12 months and now has 934,000 fiber customers in the U.S. The company also highlighted its partnership with NVIDIA to launch Europe's first industrial AI cloud and its efforts to improve efficiency through AI initiatives.Deutsche Telekom Financial Statement Overview
Summary
Deutsche Telekom shows strong profitability and cash flow management with a healthy gross profit margin and robust EBIT and EBITDA margins. However, challenges include a slight decline in revenue growth and high leverage with a debt-to-equity ratio of 2.28.Income Statement
Deutsche Telekom's income statement shows a mixed performance. The TTM data indicates a slight decline in revenue growth, but the company maintains a healthy gross profit margin of 40.6% and a net profit margin of 10.4%. The EBIT and EBITDA margins are robust, reflecting operational efficiency. However, the recent revenue contraction is a concern that needs addressing.Balance Sheet
The balance sheet reveals a high debt-to-equity ratio of 2.28, indicating significant leverage. While the return on equity is strong at 19.5%, suggesting effective use of equity, the equity ratio is relatively low, highlighting potential financial risk. The company should focus on reducing debt to improve financial stability.Cash Flow
Cash flow analysis is positive, with a strong free cash flow growth rate of 20.4% in the TTM period. The operating cash flow to net income ratio is above 1, indicating good cash generation relative to net income. The free cash flow to net income ratio is also healthy, suggesting efficient cash management.| Breakdown | TTM | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 120.15B | 118.43B | 114.73B | 117.07B | 110.47B | 102.72B |
| Gross Profit | 48.83B | 52.95B | 49.77B | 45.95B | 43.28B | 40.72B |
| EBITDA | 44.35B | 40.62B | 38.22B | 34.23B | 34.41B | 32.94B |
| Net Income | 12.48B | 11.21B | 17.79B | 8.00B | 4.18B | 4.16B |
Balance Sheet | ||||||
| Total Assets | 337.47B | 304.93B | 290.31B | 298.59B | 281.63B | 264.92B |
| Cash, Cash Equivalents and Short-Term Investments | 10.46B | 8.37B | 7.28B | 5.62B | 6.01B | 12.94B |
| Total Debt | 139.17B | 145.15B | 138.75B | 147.75B | 142.07B | 137.26B |
| Total Liabilities | 229.79B | 206.29B | 199.07B | 211.27B | 200.16B | 192.37B |
| Stockholders Equity | 71.62B | 63.30B | 56.92B | 48.56B | 42.68B | 35.92B |
Cash Flow | ||||||
| Free Cash Flow | 25.43B | 20.70B | 19.43B | 11.71B | 5.81B | 5.05B |
| Operating Cash Flow | 43.02B | 39.87B | 37.30B | 35.82B | 32.17B | 23.74B |
| Investing Cash Flow | -27.16B | -18.90B | -10.21B | -22.31B | -27.40B | -22.65B |
| Financing Cash Flow | -22.28B | -20.28B | -25.53B | -15.44B | -10.78B | 7.56B |
Deutsche Telekom Technical Analysis
Positive
32.05
Price Trends
31.81
Positive
33.42
Negative
34.85
Negative
Market Momentum
0.15
Negative
60.92
Neutral
38.15
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For DTEGY, the sentiment is Positive. The current price of 32.05 is below the 20-day moving average (MA) of 32.16, above the 50-day MA of 31.81, and below the 200-day MA of 34.85, indicating a neutral trend. The MACD of 0.15 indicates Negative momentum. The RSI at 60.92 is Neutral, neither overbought nor oversold. The STOCH value of 38.15 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for DTEGY.
Deutsche Telekom Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
81 Outperform | $171.06B | 8.62 | 19.70% | 6.60% | 2.42% | 102.17% | |
77 Outperform | $224.33B | 19.28 | 19.03% | 1.75% | 7.30% | 17.67% | |
74 Outperform | $161.60B | 12.20 | 19.34% | 3.06% | 5.54% | 104.78% | |
71 Outperform | $170.08B | 7.79 | 20.88% | 4.56% | 1.98% | 150.68% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
58 Neutral | $31.85B | -7.55 | -7.08% | 3.77% | 19.67% | -278.51% | |
45 Neutral | $22.45B | -10.25 | -0.70% | 7.47% | -5.49% | -75.51% |
* Communication Services Sector Average
DTEGY
Deutsche Telekom
32.90
3.19
10.75%
T
AT&T
24.17
3.27
15.66%
TEF
Telefonica
3.96
0.23
6.14%
VZ
Verizon
40.57
4.27
11.77%
VOD
Vodafone
13.82
5.98
76.19%
TMUS
T Mobile US
197.91
-12.27
-5.84%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.