Royal KPN (KKPNY) AI Stock Analysis

• Market Cap: $19.33B
• Dividend Yield: 3.6%
• Average Volume (3M): 305.67K
• Price to Earnings (P/E): 21.3
• Beta (1Y): 0.16
• Revenue Growth: 4.33%
• EPS Growth: 0.83%
• Country: US
• Employees: 9,718
• Sector: Communication Services
• Sector Strength: 98
• Industry: Telecommunications Services
• EPS (TTM): 0.06
• Shares Outstanding: 3,888,930,400
• 10 Day Avg. Volume: 206,958
• 30 Day Avg. Volume: 305,673
• PEG Ratio: 0.00
• Price to Book (P/B): 4.17
• Price to Sales (P/S): 2.63
• P/FCF Ratio: 15.52
• Enterprise Value/Market Cap: 1.45
• Enterprise Value/Revenue: 4.99
• Enterprise Value/Gross Profit: 9.29
• Enterprise Value/Ebitda: 12.35
• 1Y Price Target: $5.50
• Price Target Upside: 10.89% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 1

• Rating: 74 Outperform
• Price Target: $5.50 ▲(10.89% Upside)

Royal KPN's overall stock score is driven by its strong financial performance and positive earnings call, which highlighted robust revenue and EBITDA growth. The technical analysis supports a positive trend, while the valuation is fair with a solid dividend yield. Challenges in free cash flow and certain segments slightly temper the overall positive outlook.

Positive Factors

Fiber Network Expansion

Expanding the fiber network enhances service quality and market reach, positioning KPN as a leader in high-speed internet, crucial for future growth.

B2B Segment Growth

Strong growth in the B2B segment indicates robust demand for KPN's business solutions, supporting long-term revenue diversification and stability.

EBITDA Growth

Sustained EBITDA growth reflects operational efficiency and profitability, strengthening KPN's financial position and investment capacity.

Negative Factors

High Leverage

High leverage can limit financial flexibility and increase risk, potentially impacting KPN's ability to invest in growth and weather economic downturns.

Decline in Free Cash Flow

A decline in free cash flow can strain liquidity and limit KPN's ability to fund operations, pay dividends, or invest in strategic initiatives.

Pressure in Consumer Mobile Segment

Revenue pressure in the consumer mobile segment due to promotions may affect profitability and market positioning in a competitive landscape.

Royal KPN Business Overview & Revenue Model

Company Description

Koninklijke KPN N.V. provides telecommunications and information technology (IT) services in the Netherlands. It operates through Consumer; Business; Wholesale; and Network, Operations & IT segments. The company offers fixed and mobile telephony, fixed and mobile broadband internet, and television services to retail consumers; infrastructure and network related IT solutions to business customers; and wholesale network services to third parties. It also provides IT services, includes cloud and workspace, and cybersecurity; and interconnect traffic, visitor roaming, digital products, and NL-ix, an interconnect exchange, as well as sells handsets and peripheral equipment, and software licenses. The company was founded in 1881 and is headquartered in Rotterdam, the Netherlands.

How the Company Makes Money

Royal KPN generates revenue through multiple key streams, primarily from its mobile and fixed-line services. The mobile segment includes subscription-based services, prepaid plans, and mobile data offerings, while the fixed-line segment encompasses broadband internet, landline telephony, and digital television services. Additionally, KPN earns revenue from its business solutions division, which provides tailored IT and communications services to corporate clients. Partnerships with technology providers and other telecom companies enhance its service offerings and market reach. Factors contributing to its earnings include a strong customer base, competitive pricing, and investments in network infrastructure to improve service quality and expand coverage.

Royal KPN Financial Statement Overview

Summary

Royal KPN displays a strong financial position characterized by consistent revenue and profit growth, strong margins, and effective cash flow management. The company's high leverage is a potential risk but is balanced by its solid equity returns and operational efficiency. Overall, KPN is well-positioned in the telecommunications industry, with stable growth and profitability.

Income Statement

The company has demonstrated consistent revenue growth over the years, with a 3.01% increase in 2024, following a 2.18% increase in 2023. Gross profit margin remains strong at 73.0% in 2024, indicating efficient cost management. The net profit margin is stable at 15.1%, and EBIT margin at 24.8% shows solid operational performance. The EBITDA margin is robust at 46.4%, reflecting strong earnings before non-cash expenses.

Balance Sheet

The debt-to-equity ratio is 2.01, indicating high leverage but typical for the telecommunications industry. Return on equity is strong at 24.0%, showing effective use of equity. The equity ratio is 28.1%, suggesting a moderate reliance on debt. Despite high leverage, the company maintains a solid equity base and returns.

Cash Flow

Free cash flow has shown stability, though slightly declining by 4.33% in 2024. Operating cash flow is strong at 2.67x net income, indicating good cash generation from operations. The free cash flow to net income ratio is 1.12, highlighting effective cash flow management and ability to cover dividends or reinvest in the business.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	5.63B	5.60B	5.44B	5.32B	5.27B	5.28B
Gross Profit	3.02B	4.09B	2.92B	4.08B	4.09B	4.00B
EBITDA	2.27B	2.60B	2.56B	2.55B	3.31B	2.44B
Net Income	843.00M	848.00M	844.00M	760.00M	1.29B	560.00M
Balance Sheet
Total Assets	13.59B	12.55B	12.25B	11.96B	12.74B	12.08B
Cash, Cash Equivalents and Short-Term Investments	1.24B	802.00M	828.00M	527.00M	1.11B	867.00M
Total Debt	7.49B	7.10B	6.79B	6.29B	7.62B	7.44B
Total Liabilities	9.74B	9.01B	8.69B	8.31B	9.51B	9.46B
Stockholders Equity	3.85B	3.53B	3.56B	3.65B	3.23B	2.62B
Cash Flow
Free Cash Flow	1.25B	950.00M	993.00M	982.00M	908.00M	479.00M
Operating Cash Flow	2.23B	2.26B	2.24B	2.19B	2.13B	2.04B
Investing Cash Flow	-1.60B	-1.44B	-1.43B	-1.08B	-1.21B	-1.54B
Financing Cash Flow	-460.00M	-769.00M	-606.00M	-1.50B	-717.00M	-670.00M

Royal KPN Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4.96
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For KKPNY, the sentiment is Positive. The current price of 4.96 is above the 20-day moving average (MA) of 4.74, above the 50-day MA of 4.68, and above the 200-day MA of 4.19, indicating a bullish trend. The MACD of 0.07 indicates Negative momentum. The RSI at 67.06 is Neutral, neither overbought nor oversold. The STOCH value of 95.77 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for KKPNY.

Royal KPN Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TIMB	79 Outperform	$10.21B	16.01	13.78%	5.60%	-7.99%	2.16%
KKPNY	74 Outperform	$19.33B	21.34	33.12%	3.60%	4.33%	0.83%
TLK	74 Outperform	$18.59B	13.38	17.71%	6.69%	-5.13%	-5.90%
VIV	72 Outperform	$20.13B	19.82	8.20%	4.27%	-6.51%	-0.21%
Sector *	60 Neutral	$47.27B	4.55	-11.27%	4.14%	1.88%	-40.90%
VOD	60 Neutral	$28.57B	9.21	-7.17%	4.18%	0.89%	-494.16%
TEF	56 Neutral	$30.28B	―	-3.55%	6.64%	-4.73%	-251.31%