Did Tele2’s (OM:TEL2 B) New Satellite IoT Offering Redefine Its Global Expansion Potential?

• Tele2 IoT, together with Skylo, has launched a new Global Satellite IoT Connectivity service, making Tele2 the first Swedish operator to deliver a commercial 3GPP-based direct-to-device satellite IoT solution.
• This service enables automatic switching between terrestrial and satellite networks, ensuring uninterrupted IoT device connectivity for industries operating in remote or hard-to-reach locations.
• We'll explore how the addition of 3GPP-based satellite IoT connectivity could expand Tele2's addressable market and impact its investment outlook.

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Tele2 Investment Narrative Recap

To invest in Tele2, you need to believe that the company can offset pressures in its core Swedish and Baltic markets by expanding into growth areas like IoT-enabled connectivity. The recent satellite IoT partnership could broaden Tele2’s addressable B2B market, but in the short term, intense competition and ARPU compression within Swedish consumer broadband remain the most significant catalyst and risk; this news is unlikely to change those fundamentals immediately.

Among Tele2’s recent announcements, the new partnership with Turkcell for connected vehicle IoT services in Türkiye stands out as most relevant here. Together with the Skylo collaboration, these moves highlight how Tele2 is seeking B2B growth in connected services, which is a key offset against headwinds in consumer broadband and price competition.

But for anyone tracking Tele2, it’s important not to overlook persistent concerns about further sustainable cost reductions if margin momentum stalls...

Read the full narrative on Tele2 (it's free!)

Tele2's narrative projects SEK31.4 billion in revenue and SEK5.6 billion in earnings by 2028. This requires 2.0% yearly revenue growth and a SEK1.4 billion increase in earnings from the current SEK4.2 billion.

Uncover how Tele2's forecasts yield a SEK159.26 fair value, in line with its current price.

Exploring Other Perspectives

Four members of the Simply Wall St Community calculated fair values for Tele2 that range widely from SEK75.20 to SEK231.74 per share. While some see profit growth opportunities in IoT and digitalization, many remain cautious given the tough competition and low expected revenue growth, so make sure you compare a range of views.

Explore 4 other fair value estimates on Tele2 - why the stock might be worth less than half the current price!

Build Your Own Tele2 Narrative

Disagree with existing narratives? Create your own in under 3 minutes - extraordinary investment returns rarely come from following the herd.

• A great starting point for your Tele2 research is our analysis highlighting 2 key rewards and 3 important warning signs that could impact your investment decision.
• Our free Tele2 research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Tele2's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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