- Price
- $28.62
- Fair value
- $44.00
- Discount
- 35.0%
- Uncertainty
- Medium
- LSEG rating
- 1.50
- Moat
- Narrow
- Next earnings
- 2026-11-05
- Next earnings is estimate
- No
- Company name
- Deutsche Telekom
- Sector
- Telecommunications
- About
- Deutsche Telekom is a large telecom company based in Germany. It sells mobile, broadband, fiber and TV services to consumers and businesses in Germany and in several other European countries, and IT services through T-Systems. It also controls T-Mobile US, a large US wireless carrier. At June 30, 2026, Deutsche Telekom owned a 54.2% stake in T-Mobile US, net of T-Mobile US's own treasury shares, and it could vote 55.1% of the shares. T-Mobile US gives most of the group's revenue and EBITDA, so its share price and the US dollar drive much of Deutsche Telekom's value. Customers pay monthly fees, so revenue is steady. The German state and its bank KfW together own 28.6% of the shares. This listing is an American Depositary Receipt of the shares that trade in Frankfurt.
- Thesis
- Deutsche Telekom trades at a discount because the market fears new competition for T-Mobile US, its largest asset, and because a holding company rarely trades at the full value of its stakes. The company says that the SpaceX IPO, completed in June 2026, dominated the market for US telecom stocks in the first half of 2026, and investors fear SpaceX as a future competitor. The T-Share fell to its low for the half year, EUR 23.85, on June 30, 2026. On October 9, 2026, T-Mobile US fell about 13% and Deutsche Telekom fell about 9%, after press reports that SpaceX had bought low-band spectrum from Grain Management. Analysts also point to more promotions from Verizon and AT&T. The operating results stay strong: adjusted EBITDA AL grew 7.3% in organic terms in Q2 2026, and Deutsche Telekom raised its free cash flow guidance and its 2026 share buy-back to up to EUR 5 billion. For the gap to close, T-Mobile US must keep adding postpaid accounts inside its guidance of 950,000 to 1,050,000 for 2026 and keep EBITDA growth near 10%, satellite services must stay a small threat to ground networks, and Deutsche Telekom must meet its 2026 targets of about EUR 47.5 billion of adjusted EBITDA AL and about EUR 2.20 of adjusted EPS. The tests are the T-Mobile US Q3 report in late October 2026, Deutsche Telekom's Q3 report on November 5, 2026, and the full-year report on February 25, 2027. If US growth holds, part of the gap can close over two to three years, but the holding structure keeps some discount.
- Risks
- T-Mobile US is most of the group's value. New competition, such as satellite services from SpaceX, or price competition from Verizon and AT&T can slow its customer growth and lower its share price. Deutsche Telekom's share price follows it.
A weaker US dollar lowers the value of T-Mobile US results in euros. Exchange rate effects already lowered reported growth in the first half of 2026.
In Germany, the number of broadband lines falls as customers leave copper lines, and only part of them move to fiber. Broadband customers fell by 20,000 in Q2 2026.
Net debt including leases was EUR 138.4 billion at June 30, 2026, up EUR 5.9 billion in six months, mainly because of share buy-backs at T-Mobile US and Deutsche Telekom. Higher interest rates raise the cost of new debt.
The German state owns 28.6% of the shares with KfW. Regulation of telecom prices, spectrum and network rules in Europe and the US can limit returns.
- Balance sheet
- Cash: €5.4B
Debt: €114.0B
Net debt: €108.6B
EBITDA, last 12 months: €45.3B
Net debt / EBITDA: 2.4× (medium)
Interest cover: 3.9×
Debt due within 12 months: €13.0B
Ratings: Moody's A3 (stable outlook), S&P A- (stable outlook), Fitch A- (stable outlook)
At June 30, 2026, Deutsche Telekom had EUR 5.4 billion of cash and EUR 114.0 billion of financial liabilities, most of them bonds. Debt here does not include EUR 36.1 billion of lease liabilities. Much of the debt sits at T-Mobile US. The company reports net debt AL, which leaves out most leases and nets some financial assets, of EUR 104.4 billion. EBITDA is adjusted EBITDA AL for the 12 months to June 2026, worked out from the full-year 2025 and half-year figures. Interest cover is EBIT divided by interest expense for the first half of 2026. EUR 13.0 billion of financial liabilities fall due within one year, and EUR 60.9 billion are due after five years. Net debt rose in the first half of 2026 because of share buy-backs of EUR 6.1 billion at T-Mobile US and EUR 1.0 billion at Deutsche Telekom. S&P raised its rating to A- on May 11, 2026, and Fitch did the same on June 22, 2026. The company targets ratings between BBB and A-.
As of 2026-06-30.
- Checkpoints
- Nov 5, 2026: Q3 2026 results: T-Mobile US growth and guidance. Pending. Watch: Organic adjusted EBITDA AL growth near 7%, T-Mobile US postpaid account growth on track for its 2026 guidance and confirmed group guidance pass; slower US account growth or a cut to guidance fails.
Feb 25, 2027: Full-year 2026 results and 2027 guidance. Pending. Watch: 2026 targets met, 2027 guidance with growth in adjusted EBITDA AL and EPS, and continued buy-backs pass; lower US growth guidance fails.
- Recent events
- 2026-10-09: T-Mobile US fell about 13% and Deutsche Telekom's ADR fell about 9%. Press reports tied the fall to news that SpaceX had bought low-band 800 MHz spectrum from Grain Management, which raised fears of a new wireless competitor. Verizon and AT&T also fell.
2026-08-17: Deutsche Telekom agreed to buy Fiberhost, a Polish fiber network operator, and Inea, a Polish broadband and TV provider, from Macquarie Asset Management for an enterprise value of about EUR 1 billion. The deal adds over 300,000 customers and a network that passes over 1.4 million homes to T-Mobile Polska.
2026-08-06: Deutsche Telekom reported Q2 2026 results. Net revenue grew 3.3% in organic terms to EUR 29.9 billion, adjusted EBITDA AL grew 7.3% to EUR 11.8 billion, and adjusted net profit rose 11.1% to EUR 2.8 billion. It raised 2026 free cash flow AL guidance to about EUR 20.0 billion. The same day, it raised its 2026 share buy-back by up to EUR 3 billion, to up to EUR 5 billion, and said the shares trade at the low end of their historical valuation range.
2026-06-22: Fitch raised Deutsche Telekom's credit rating to A- with a stable outlook. S&P had raised its rating to A- on May 11, 2026.
2026-05-13: Deutsche Telekom reported Q1 2026 results. Net revenue grew 4.7% in organic terms to EUR 29.9 billion, and adjusted EBITDA AL grew 7.5% to EUR 11.5 billion. It raised its 2026 guidance to about EUR 47.5 billion of adjusted EBITDA AL and more than EUR 19.8 billion of free cash flow AL, and kept adjusted EPS guidance at about EUR 2.20.