company background image
TEF

TelefónicaBME:TEF Stock Report

Market Cap

€21.1b

7D

-0.7%

1Y

22.7%

Updated

23 Oct, 2021

Data

Company Financials +
TEF fundamental analysis
Snowflake Score
Valuation5/6
Future Growth0/6
Past Performance4/6
Financial Health4/6
Dividends4/6

TEF Overview

Telefónica, S.A., together with its subsidiaries, provides telecommunications services in Europe and Latin America.

Telefónica Competitors

Price History & Performance

Summary of all time highs, changes and price drops for Telefónica
Historical stock prices
Current Share Price€3.77
52 Week High€2.71
52 Week Low€4.32
Beta1.07
1 Month Change-7.38%
3 Month Change0.29%
1 Year Change22.65%
3 Year Change-44.93%
5 Year Change-59.17%
Change since IPO95.57%

Recent News & Updates

Oct 10
Here's Why We Think Telefónica (BME:TEF) Is Well Worth Watching

Here's Why We Think Telefónica (BME:TEF) Is Well Worth Watching

Some have more dollars than sense, they say, so even companies that have no revenue, no profit, and a record of falling...

Sep 23
Telefónica (BME:TEF) Is Doing The Right Things To Multiply Its Share Price

Telefónica (BME:TEF) Is Doing The Right Things To Multiply Its Share Price

If you're looking for a multi-bagger, there's a few things to keep an eye out for. Ideally, a business will show two...

Sep 05
Is It Too Late To Consider Buying Telefónica, S.A. (BME:TEF)?

Is It Too Late To Consider Buying Telefónica, S.A. (BME:TEF)?

Let's talk about the popular Telefónica, S.A. ( BME:TEF ). The company's shares saw a double-digit share price rise of...

Shareholder Returns

TEFES TelecomES Market
7D-0.7%0.9%-0.6%
1Y22.7%11.6%23.8%

Return vs Industry: TEF exceeded the Spanish Telecom industry which returned 11.6% over the past year.

Return vs Market: TEF underperformed the Spanish Market which returned 23.8% over the past year.

Price Volatility

Is TEF's price volatile compared to industry and market?
TEF volatility
TEF Beta1.07
Industry Beta0.61
Market Beta1

Stable Share Price: TEF is not significantly more volatile than the rest of Spanish stocks over the past 3 months, typically moving +/- 3% a week.

Volatility Over Time: TEF's weekly volatility (3%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
1924111,490Jose María Alvarez-Pallete Lopezhttps://www.telefonica.com

Telefónica, S.A., together with its subsidiaries, provides telecommunications services in Europe and Latin America. The company’s mobile and related services and products comprise mobile voice, value added, mobile data, Internet, wholesale, corporate, roaming, fixed wireless, trunking, and paging services. Its fixed telecommunication services include PSTN lines; ISDN accesses; public telephone services; local, domestic, and international long-distance and fixed-to-mobile communications; corporate communications; supplementary value-added services; video telephony; intelligent network; and telephony information services.

Telefónica Fundamentals Summary

How do Telefónica's earnings and revenue compare to its market cap?
TEF fundamental statistics
Market Cap€21.12b
Earnings (TTM)€9.13b
Revenue (TTM)€42.54b

2.3x

P/E Ratio

0.5x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
TEF income statement (TTM)
Revenue€42.54b
Cost of Revenue€18.16b
Gross Profit€24.38b
Expenses€15.25b
Earnings€9.13b

Last Reported Earnings

Jun 30, 2021

Next Earnings Date

Oct 28, 2021

Earnings per share (EPS)1.63
Gross Margin57.31%
Net Profit Margin21.46%
Debt/Equity Ratio140.0%

How did TEF perform over the long term?

See historical performance and comparison

Dividends

8.0%

Current Dividend Yield

21%

Payout Ratio

Valuation

Is Telefónica undervalued compared to its fair value and its price relative to the market?

>50%

Undervalued compared to fair value


Share Price vs. Fair Value

Below Fair Value: TEF (€3.77) is trading below our estimate of fair value (€11.39)

Significantly Below Fair Value: TEF is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: TEF is good value based on its PE Ratio (2.3x) compared to the European Telecom industry average (22.7x).

PE vs Market: TEF is good value based on its PE Ratio (2.3x) compared to the Spanish market (23.2x).


Price to Earnings Growth Ratio

PEG Ratio: TEF's earnings are forecast to decline next year, so we can't calculate its PEG ratio.


Price to Book Ratio

PB vs Industry: TEF is good value based on its PB Ratio (0.9x) compared to the ES Telecom industry average (2.5x).


Future Growth

How is Telefónica forecast to perform in the next 1 to 3 years based on estimates from 28 analysts?

-39.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TEF's earnings are forecast to decline over the next 3 years (-39.9% per year).

Earnings vs Market: TEF's earnings are forecast to decline over the next 3 years (-39.9% per year).

High Growth Earnings: TEF's earnings are forecast to decline over the next 3 years.

Revenue vs Market: TEF's revenue is expected to decline over the next 3 years (-2% per year).

High Growth Revenue: TEF's revenue is forecast to decline over the next 3 years (-2% per year).


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TEF's Return on Equity is forecast to be low in 3 years time (14.8%).


Past Performance

How has Telefónica performed over the past 5 years?

14.8%

Historical annual earnings growth


Earnings and Revenue History

Quality Earnings: TEF has a large one-off gain of €9.5B impacting its June 30 2021 financial results.

Growing Profit Margin: TEF's current net profit margins (21.5%) are higher than last year (0.3%).


Past Earnings Growth Analysis

Earnings Trend: TEF has become profitable over the past 5 years, growing earnings by 14.8% per year.

Accelerating Growth: TEF's earnings growth over the past year (7507.5%) exceeds its 5-year average (14.8% per year).

Earnings vs Industry: TEF earnings growth over the past year (7507.5%) exceeded the Telecom industry 19.1%.


Return on Equity

High ROE: Whilst TEF's Return on Equity (36.58%) is high, this metric is skewed due to their high level of debt.


Financial Health

How is Telefónica's financial position?


Financial Position Analysis

Short Term Liabilities: TEF's short term assets (€29.6B) exceed its short term liabilities (€24.5B).

Long Term Liabilities: TEF's short term assets (€29.6B) do not cover its long term liabilities (€56.6B).


Debt to Equity History and Analysis

Debt Level: TEF's debt to equity ratio (140%) is considered high.

Reducing Debt: TEF's debt to equity ratio has reduced from 242.8% to 140% over the past 5 years.

Debt Coverage: TEF's debt is well covered by operating cash flow (28.5%).

Interest Coverage: TEF's interest payments on its debt are well covered by EBIT (6.2x coverage).


Balance Sheet


Dividend

What is Telefónica current dividend yield, its reliability and sustainability?

7.95%

Current Dividend Yield


Dividend Yield vs Market

Notable Dividend: TEF's dividend (7.95%) is higher than the bottom 25% of dividend payers in the Spanish market (1.5%).

High Dividend: TEF's dividend (7.95%) is in the top 25% of dividend payers in the Spanish market (5.45%)


Stability and Growth of Payments

Stable Dividend: TEF's dividend payments have been volatile in the past 10 years.

Growing Dividend: TEF's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its low payout ratio (21.3%), TEF's dividend payments are well covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: TEF's dividends in 3 years are forecast to be covered by earnings (67.9% payout ratio).


Next Steps

Management

How experienced are the management team and are they aligned to shareholders interests?

4.3yrs

Average management tenure


CEO

Jose María Alvarez-Pallete Lopez (58 yo)

5.5yrs

Tenure

€5,041,026

Compensation

Mr. Jose Maria Alvarez-Pallete López has been the Chief Executive Officer of Telefónica Latinoamérica, a subsidiary of Telefonica S.A. since 2002. Mr. López has been Chief Executive Officer at Telefónica,...


CEO Compensation Analysis

Compensation vs Market: Jose María's total compensation ($USD5.86M) is above average for companies of similar size in the Spanish market ($USD2.81M).

Compensation vs Earnings: Jose María's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: TEF's management team is considered experienced (4.3 years average tenure).


Board Members

Experienced Board: TEF's board of directors are seasoned and experienced ( 11.8 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have been diluted in the past year, with total shares outstanding growing by 5.6%.


Top Shareholders

Company Information

Telefónica, S.A.'s employee growth, exchange listings and data sources


Key Information

  • Name: Telefónica, S.A.
  • Ticker: TEF
  • Exchange: BME
  • Founded: 1924
  • Industry: Integrated Telecommunication Services
  • Sector: Telecom
  • Market Cap: €21.119b
  • Shares outstanding: 5.60b
  • Website: https://www.telefonica.com

Number of Employees


Location

  • Telefónica, S.A.
  • Distrito Telefónica
  • Ronda de la Comunicación, s/n
  • Madrid
  • Madrid
  • 28050
  • Spain

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2021/10/23 17:58
End of Day Share Price2021/10/22 00:00
Earnings2021/06/30
Annual Earnings2020/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.