Share Buybacks and a Credit Upgrade Fail to Lift Deutsche Telekom as T-Mobile US Uncertainty Persists
Published on 06/25/2026 at 20:06 | Redaktion boerse-global.de
The German telecoms giant is doing everything right on paper — upgrading its credit rating, hoovering up its own shares and reporting robust operational growth. Yet the stock continues to drift near its 52-week low, a stark reminder that for Deutsche Telekom, the overhang from T-Mobile US remains the only story that matters.
Fitch lifted the company’s long-term rating from BBB+ to A- on 22 June, citing the strength of Deutsche Telekom’s domestic market position and the reliable cash flows generated by its American subsidiary. The outlook is stable, typically a green light for lower financing costs and a firmer share price. But the equity barely stirred. At 26.21 euros, the stock is just a whisker above the year’s trough of 25.71 euros and has shed more than 10% over the past month. The 50-day moving average sits at 27.98 euros, a level now out of sight.
The buyback machine is running at full throttle. Since the start of the programme in April, management has retired nearly 17 million shares by mid-June. The current tranche, authorised for up to 550 million euros, expires on 30 June, and the board has a total envelope of 2 billion euros for 2026. That support should have put a floor under the stock, but it has been overwhelmed by the market’s fixation on T-Mobile US.
Speculation over a deeper integration of the American business first surfaced in a Wall Street Journal report, which claimed chief executive Tim Höttges is exploring a holding company structure that would merge the two entities. Deutsche Telekom has not confirmed the plan, but the mere prospect has unnerved investors. A major structural obstacle stands in the way: the German government and KfW together control roughly 28% of the group, and Berlin’s blessing is far from guaranteed.
Should investors sell immediately? Or is it worth buying Deutsche Telekom?
The operational numbers tell a different story. In the first quarter of 2026, organic revenue rose 4.7% to 29.9 billion euros, while adjusted EBITDA climbed 7.5% to 11.5 billion euros. The full-year guidance was lifted to an adjusted EBITDA of around 47.5 billion euros and free cash flow in excess of 19.8 billion euros. Management also targets a cumulative cash surplus of 15 billion euros by 2027 while keeping net leverage below 2.75 times. Domestically, the network build-out continues: a new 5G site went live in Dortmund this week, with five more to follow, and the company now passes roughly 15 million households with fibre.
The valuation, on a price-to-earnings ratio of under 13 times and a dividend yield of 3.76%, has not gone unnoticed. One Seeking Alpha analyst upgraded the stock to Buy on 22 June with a price target of 28 euros, calling it a conservative, stable telecom play. Yet growth catalysts remain absent as long as the T-Mobile US riddle remains unsolved.
The technical picture offers a flicker of hope. The relative strength index sits at 32.1, deep in oversold territory — often a signal that selling pressure is exhausted. The next major catalyst arrives on 23 July, when T-Mobile US reports its quarterly results. The American unit contributes roughly two-thirds of group adjusted operating profit, so a strong showing could ease the tension on the parent company’s shares. If, however, the stock slips below 26 euros before then, a further chart-based slide could follow.
Deutsche Telekom at a turning point? This analysis reveals what investors need to know now.
Deutsche Telekom’s own second-quarter figures are due on 6 August, by which point Höttges will almost certainly have to address the integration speculation head-on. Until then, the market is caught between a company that is outperforming fundamentally and a corporate structure that remains unresolved.
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