Telefónica, S.A.

BATS-CHIXE:TEFE Stock Report

Market Cap: €24.1b

Telefónica Valuation

Is TEFE undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

  • Below Fair Value

  • Significantly Below Fair Value

  • Price-To-Sales vs Peers

  • Price-To-Sales vs Industry

  • Price-To-Sales vs Fair Ratio

  • Analyst Forecast

Share Price vs Fair Value

What is the Fair Price of TEFE when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: TEFE (€4.21) is trading below our estimate of fair value (€7.22)

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

Key Valuation Metric

Which metric is best to use when looking at relative valuation for TEFE?

Key metric: As TEFE is unprofitable we use its Price-To-Sales Ratio for relative valuation analysis.

The above table shows the Price to Sales ratio for TEFE. This is calculated by dividing TEFE's market cap by their current revenue.
What is TEFE's PS Ratio?
PS Ratio0.6x
Sales€40.57b
Market Cap€24.15b

Price to Sales Ratio vs Peers

How does TEFE's PS Ratio compare to its peers?

The above table shows the PS ratio for TEFE vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyForward PSEstimated GrowthMarket Cap
Peer Average3.1x
BT.A BT Group
0.7x0.3%UK£14.2b
HTWS Helios Towers
1.8x8.0%UK£1.1b
VOD Vodafone Group
0.6x0.9%UK£18.4b
ZEG Zegona Communications
9.4x37.6%UK£2.3b
TEFE Telefónica
0.6x0.8%€24.1b

Price-To-Sales vs Peers: TEFE is good value based on its Price-To-Sales Ratio (0.6x) compared to the peer average (3.1x).

Price to Sales Ratio vs Industry

How does TEFE's PS Ratio compare vs other companies in the European Telecom Industry?

5 CompaniesPrice / SalesEstimated GrowthMarket Cap
No. of Companies12PS012345+
5 CompaniesEstimated GrowthMarket Cap
No more companies

Price-To-Sales vs Industry: TEFE is good value based on its Price-To-Sales Ratio (0.6x) compared to the European Telecom industry average (1.1x).

Price to Sales Ratio vs Fair Ratio

What is TEFE's PS Ratio compared to its Fair PS Ratio? This is the expected PS Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

TEFE PS Ratio vs Fair Ratio.
Fair Ratio
Current PS Ratio0.6x
Fair PS Ratio1.2x

Price-To-Sales vs Fair Ratio: TEFE is good value based on its Price-To-Sales Ratio (0.6x) compared to the estimated Fair Price-To-Sales Ratio (1.2x).

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

The above table shows the analyst TEFE forecast and predictions for the stock price in 12 month’s time.
DateShare PriceAverage 1Y Price TargetDispersionHighLow1Y Actual priceAnalysts
Currentn/a
€4.25
0%
12.1%€5.00€3.20n/a21
Nov ’25€4.30
€4.24
-1.5%
11.5%€5.00€3.20n/a21
Oct ’25€4.41
€4.18
-5.2%
12.2%€5.00€3.20n/a23
Sep ’25€4.09
€4.18
+2.1%
12.2%€5.00€3.20n/a23
Aug ’25€4.14
€4.20
+1.3%
12.3%€5.00€3.20n/a22
Jul ’25€3.98
€4.22
+6.0%
12.5%€5.10€3.20n/a23
Jun ’25€4.26
€4.26
-0.1%
11.9%€5.10€3.30n/a23
May ’25€4.25
€4.26
+0.1%
12.0%€5.10€3.30n/a23
Apr ’25€4.11
€4.31
+4.8%
11.6%€5.10€3.30n/a22
Mar ’25€3.84
€4.28
+11.6%
12.2%€5.00€3.30n/a22
Feb ’25€3.76
€4.23
+12.5%
11.9%€5.00€3.20n/a22
Jan ’25€3.54
€4.23
+19.5%
12.2%€5.00€3.20n/a21
Dec ’24€3.99
€4.23
+6.2%
13.2%€5.10€3.20n/a21
Nov ’24€3.60
€4.15
+15.2%
15.4%€5.10€2.70€4.3023
Oct ’24€3.84
€4.22
+9.7%
14.9%€5.10€2.70€4.4123
Sep ’24n/a
€4.23
0%
15.1%€5.00€2.70€4.0925
Aug ’24€3.84
€4.40
+14.5%
13.5%€5.30€3.00€4.1425
Jul ’24€3.69
€4.39
+19.1%
14.3%€5.30€2.70€3.9824
Jun ’24€3.93
€4.39
+11.7%
15.2%€5.60€2.70€4.2624
May ’24€4.12
€4.30
+4.4%
17.6%€5.60€2.70€4.2526
Apr ’24€3.96
€4.32
+9.1%
17.5%€5.60€2.70€4.1126
Mar ’24€3.90
€4.30
+10.3%
18.5%€5.60€2.50€3.8426
Feb ’24€3.47
€4.40
+26.5%
19.8%€6.40€2.50€3.7626
Jan ’24€3.38
€4.51
+33.5%
19.6%€6.40€2.70€3.5425
Dec ’23€3.63
€4.58
+26.0%
20.8%€6.40€2.70€3.9925
Nov ’23€3.51
€4.75
+35.4%
19.8%€6.40€2.75€3.6026

Analyst Forecast: Target price is lower than the current share price.

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