Deutsche Telekom: Potential Catalyst But Risks Remain

Summary

• The mobile service market in Germany is saturated, but the fiber broadband one might be the catalyst as we move forward.
• In addition, DT's management also voiced a bullish expectation: FCF is estimated to increase despite 5G and FTTH investments.
• Moreover, DT's EBITDA margin is slightly ahead of its European competitors, not to mention an attractive EV/EBITDA multiple.
• In conclusion, the shares might be worth of further research. Still, risks remain as such significant investments might not be proportionate to the demand, leading to possible shrinking FCFs.

Andreas Rentz/Getty Images News

Investment Thesis

Although Deutsche Telekom (OTCQX:DTEGY) benefitted from its US operations, its growth in Germany remains tepid. However, although the mobile service market appears to be saturated, the fiber broadband market might be the catalyst as we move

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