Deutsche Telekom's Shelved US Bid Eases the Pressure, but November 5 Still Has to Prove the Earnings Case
Published on 10/30/2026 at 12:01 | Editorial boerse-global.de
Deutsche Telekom shares advanced 1.0% to €25.83 on Thursday, a modest move that nonetheless captures the twin forces now shaping the investment case: relief that a near-term transaction risk has stepped back, and lingering doubt over whether the operating numbers can carry the stock's lofty price targets.
The relief stems from Reuters reporting that the Bonn-based group has for now set aside a formal offer to fully merge with T-Mobile US. The plan has not been abandoned outright. Bloomberg had already reported on Wednesday that the company was holding off on a formal bid, and people familiar with the matter cited by Reuters said a later approach remains possible. Works council opposition and other hurdles are thought to have weighed on the decision.
That distinction matters. What has been parked is the next formal step, not necessarily the strategic goal. The market's positive reception therefore reads as relief over a temporarily lower transaction risk rather than a signal that the merger question has been settled for good.
JPMorgan Keeps Its Rating — and Its Caveat
JPMorgan analyst Akhil Dattani left Deutsche Telekom at "Overweight" with a €38 price target on the same day, while continuing to flag uncertainty over a possible combination as a drag on the shares. His stance neatly caps how much comfort investors should draw from the pause: as long as a future bid stays on the table, the open structural question sits alongside the operating story.
The already-published results from T-Mobile US supply the economic backdrop. For the third quarter of 2026, the subsidiary reported service revenue of $19.4 billion, up 6% year on year. In Dattani's view the figures met expectations, and the updated full-year guidance ranges were broadly in line with consensus — no trigger, in other words, for a fundamental rethink of the operating business.
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T-Mobile US also lifted its 2026 guidance for adjusted free cash flow to $18.7–18.8 billion.
The Bar Is Set at €0.60
Attention now shifts to Deutsche Telekom's own third-quarter release, scheduled for 5 November 2026. Analysts are looking for earnings per share of €0.60 on revenue of €30.45 billion, and the gap between those two lines is where the argument will be won or lost.
The prior quarter shows why. In the second quarter of 2026, EPS came in at €0.51, down from €0.54 a year earlier, even as revenue reached €29.93 billion. Sales and profit have not been moving in step, so the size of the top line alone will not settle the question. A convincing earnings performance would underpin confidence; another weak print would raise questions about the quality of growth.
Just as important will be the explanation behind the group result — specifically how the US business is developing and how durable profitability looks. The consensus figure is a hurdle set by analysts, not a promise from management.
Price Targets Are Expectations, Not Evidence
Investment banks continue to see upside despite the recent weakness in the share price. Deutsche Bank carries a €40 target, JPMorgan €38, and several other houses sit around €35. Those numbers point to a positive directional view, but they describe expectations rather than proof of rising earning power.
In the bull case, Deutsche Telekom meets or beats the profit forecast and pairs it with a convincing picture of the US business — giving the optimistic ratings an operating foundation. Bigger share buybacks could add support, though that too is a possible driver rather than a certainty. Repurchases on their own would struggle to offset a disappointing trading performance.
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The bear argument is straightforward: the high targets may be running ahead of actual earnings. A miss on 5 November, or fresh doubts about US profitability, would leave the gap between analyst confidence and operating evidence unresolved.
Strategic Options Are Not Earnings
Investors should be equally careful about treating new business opportunities as contributions to the bottom line. AST SpaceMobile disclosed a previously signed letter of intent from Deutsche Telekom, Orange, TelefĂłnica and Vodafone to examine a joint bid for European satellite spectrum frequencies. That is not a decided or completed joint offer.
Satellite connectivity could complement the existing offering, but integration and investment requirements remain open, as do the potential effects on rural coverage and customer churn. No reliable short-term earnings contribution can be derived from the project at this stage.
Until the quarterly figures land, the core business remains the deciding factor. Analyst targets and possible buybacks are supporting expectations; the earnings proof is still outstanding.
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