The numbers tell a story of momentum and patience. Deutsche Telekom’s shares closed Friday at €28.87, a modest 0.4 per cent daily gain that masks a more meaningful recovery — the stock has climbed 23 per cent since its late-June trough of €23.54, even as it remains roughly 16 per cent shy of its February peak of €34.35.
That gap between current pricing and recent highs is precisely where valuation analysts see opportunity. Simply Wall St’s discounted cash flow model, employing a 5.79 per cent discount rate, puts fair value at €37.41 — implying a 22.6 per cent discount to the prevailing share price. The calculation leans heavily on improving earnings, with the US operations doing the heavy lifting.
The American Growth Machine
T-Mobile US delivered 277,000 net postpaid customer additions in the second quarter of 2026, comfortably ahead of the 217,000 recorded in the same period a year earlier. Beyond subscriber growth, the US arm is also reporting rising average revenue per user and steady progress on fibre deployment through its Lumos and Metronet stakes. The fixed-wireless segment, delivering internet over mobile networks, is described as robust.
These operational metrics translate directly into group financials. Revenue climbed to €29.93 billion from €28.67 billion a year earlier, though earnings per share dipped slightly to €0.51 from €0.54. The subsequent upward revision to full-year profit guidance has been widely cited as a key catalyst for the recent share-price firming.
The transatlantic relationship remains structurally incomplete, however. Reports of a full merger between the German parent and its US subsidiary persist, but the plan is not being actively pursued owing to regulatory concerns voiced by US management. When that news emerged just over a week ago, the stock actually rose 0.8 per cent — investors reading the caution as pragmatism rather than retreat.
Analyst Targets Point Higher
The consensus price target across the analyst community sits near €37, with individual targets ranging from €35 to €40. UBS’s Polo Tang reaffirmed a “Buy” rating with a €36.20 target in early August, responding to the expansion of the share buyback programme — a move he characterised as the biggest positive surprise in recent corporate announcements. Deutsche Bank Research’s Robert Grindle set a €40 target with a “Buy” rating, citing upgraded buyback and free cash flow guidance, while JPMorgan maintained “Overweight” with a €38 target, noting adjusted net income including T-Mobile US ran roughly 6 per cent above consensus estimates.
Should investors sell immediately? Or is it worth buying Deutsche Telekom?
For income-focused investors, the dividend adds another layer: a payout of €1.13 per share is anticipated for the current fiscal year, up from €1.00 for 2025, translating to a yield of roughly 3 per cent at current levels.
Polish Fibre and Structural Shifts
Europe is not being neglected. Through T-Mobile Polska, the group is acquiring fibre network operator Fiberhost and broadband provider Inea from Macquarie Asset Management and other minority shareholders. The transaction values the two businesses at approximately €1 billion, extending the company’s fibre footprint beyond Germany.
The strategic pivot toward mobile, fibre and the US market reflects a broader industry transformation. A Verivox survey of 1,000 respondents found only 61 per cent of Germans still use a landline phone at home — down ten percentage points year on year, and just 42 per cent among 18-to-29-year-olds. The erosion of the traditional fixed-line business underscores why the group’s growth increasingly depends on segments where it holds stronger cards.
The longer-term share price record supports the thesis: a 65.35 per cent gain over three years and 84.51 per cent over five, even as the twelve-month comparison shows an 8.4 per cent decline. The stock trades roughly 6.9 per cent above its 50-day moving average of €26.99, a technical signal that the recent upward bias remains intact.
The next catalyst arrives on 5 November, when third-quarter results are due. Until then, the debate over whether the discount to fair value narrows further will hinge on the same variables that have driven the story so far: US subscriber momentum, fibre investment discipline and the patience of regulators watching from Washington and Warsaw alike.
Ad
Deutsche Telekom Stock: Buy or Sell?! New Deutsche Telekom Analysis from August 22 delivers the answer:
The latest Deutsche Telekom figures speak for themselves: Urgent action needed for Deutsche Telekom investors. Is it worth buying or should you sell? Find out what to do now in the current free analysis from August 22.
Deutsche Telekom: Buy or sell? Read more here...
