(TEF) Telefonica - Overview
Sector: Communication Services | Industry: Telecom Services | Exchange: MC (Spain) | Market Cap: 23.138m EUR | Total Return: -6.7% in 12m
Avg Turnover: 41.5M
Qual. Beats: -2
Rev. Trend: -80.5%
Qual. Beats: 0
Warnings
Beneish M-Score 1.00 > -1.5 - likely earnings manipulation
Altman Z'' 0.73 < 1.0 - financial distress zone
Tailwinds
No distinct edge detected
Telefónica, S.A. (TEF) is a global integrated telecommunications provider headquartered in Madrid, operating primarily across Europe and Latin America. The company manages a comprehensive portfolio of fixed and mobile connectivity, including fiber-to-the-home (FTTH), 5G mobile data, and traditional voice services. Beyond core connectivity, Telefónica has diversified into digital services such as cloud computing, cybersecurity, big data analytics, and financial technology.
The integrated telecommunications sector is characterized by high capital expenditure requirements due to the continuous need for infrastructure upgrades like fiber optics and spectrum licenses. Telefónica’s business model relies on a mix of retail consumer services and wholesale operations, where it leases network infrastructure and ducts to competing operators to maximize asset utilization. This dual approach helps mitigate the high fixed costs associated with maintaining extensive physical networks across multiple continents.
Investors can evaluate the underlying valuation metrics and dividend sustainability of Telefónica by reviewing the detailed data available on ValueRay. Since its founding in 1924, the company has evolved from a national monopoly into a competitive multinational player, increasingly focusing on software-defined networking and artificial intelligence to optimize its global operations.
- Latin American currency volatility impacts consolidated revenue and dividend stability
- High debt levels increase sensitivity to European Central Bank interest rate shifts
- Spanish market competition pressures average revenue per user and retail margins
- Fiber optic network monetization and infrastructure divestments drive balance sheet deleveraging
- Regulatory approval of domestic telecom mergers alters competitive landscape and pricing power
| Net Income: -3.43b TTM > 0 and > 6% of Revenue |
| FCF/TA: 0.05 > 0.02 and ΔFCF/TA 0.38 > 1.0 |
| NWC/Revenue: -10.37% < 20% (prev -1.74%; Δ -8.63% < -1%) |
| CFO/TA 0.11 > 3% & CFO 9.79b > Net Income -3.43b |
| Net Debt (42.0b) to EBITDA (11.3b): 3.71 < 3 |
| Current Ratio: 0.84 > 1.5 & < 3 |
| Outstanding Shares: last quarter (5.63b) vs 12m ago -0.20% < -2% |
| Gross Margin: 1.83% > 18% (prev 0.52%; Δ 130.8% > 0.5%) |
| Asset Turnover: 37.61% > 50% (prev 40.80%; Δ -3.19% > 0%) |
| Interest Coverage Ratio: 1.09 > 6 (EBITDA TTM 11.3b / Interest Expense TTM 1.98b) |
| A: -0.04 (Total Current Assets 19.5b - Total Current Liabilities 23.1b) / Total Assets 89.5b |
| B: 0.18 (Retained Earnings 16.5b / Total Assets 89.5b) |
| C: 0.02 (EBIT TTM 2.17b / Avg Total Assets 94.3b) |
| D: 0.23 (Book Value of Equity 16.5b / Total Liabilities 71.3b) |
| Altman-Z'' = 0.73 = B |
| DSRI: 0.11 (Receivables 1.00b/10.7b, Revenue 35.5b/40.4b) |
| GMI: 28.43 (GM 1.83% / 51.96%) |
| AQI: 1.02 (AQ_t 0.50 / AQ_t-1 0.49) |
| SGI: 0.88 (Revenue 35.5b / 40.4b) |
| TATA: -0.15 (NI -3.43b - CFO 9.79b) / TA 89.5b) |
| Beneish M = 20.86 (Cap -4..+1) = D |
As of May 25, 2026, the stock is trading at EUR 4.07 with a total of 8,286,762 shares traded.
Over the past week, the price has changed by +3.17%,
over one month by +4.98%,
over three months by +11.42% and
over the past year by -6.74%.
Telefonica has no consensus analysts rating.
P/E Forward = 14.1044
P/S = 0.6437
P/B = 1.533
P/EG = 0.3776
Revenue TTM = 35.5b EUR
EBIT TTM = 2.17b EUR
EBITDA TTM = 11.3b EUR
Long Term Debt = 28.1b EUR (from longTermDebt, last fiscal year)
Short Term Debt = 7.46b EUR (from shortTermDebt, last quarter)
Debt = 49.7b EUR (from shortLongTermDebtTotal, last quarter) + Leases 7.58b
Net Debt = 42.0b EUR (calculated: Debt 49.7b - CCE 7.70b)
Enterprise Value = 65.1b EUR (23.1b + Debt 49.7b - CCE 7.70b)
Interest Coverage Ratio = 1.09 (Ebit TTM 2.17b / Interest Expense TTM 1.98b)
EV/FCF = 13.80x (Enterprise Value 65.1b / FCF TTM 4.72b)
FCF Yield = 7.25% (FCF TTM 4.72b / Enterprise Value 65.1b)
FCF Margin = 13.31% (FCF TTM 4.72b / Revenue TTM 35.5b)
Net Margin = -9.67% (Net Income TTM -3.43b / Revenue TTM 35.5b)
Gross Margin = 1.83% ((Revenue TTM 35.5b - Cost of Revenue TTM 34.8b) / Revenue TTM)
Gross Margin QoQ = 10.23% (prev -21.74%)
Tobins Q-Ratio = 0.73 (Enterprise Value 65.1b / Total Assets 89.5b)
Interest Expense / Debt = 3.99% (Interest Expense 1.98b / Debt 49.7b)
Taxrate = 29.44% (189.0m / 642.0m)
NOPAT = 1.53b (EBIT 2.17b * (1 - 29.44%))
Current Ratio = 0.84 (Total Current Assets 19.5b / Total Current Liabilities 23.1b)
Debt / Equity = 3.42 (Debt 49.7b / totalStockholderEquity, last quarter 14.5b)
Debt / EBITDA = 3.71 (Net Debt 42.0b / EBITDA 11.3b)
Debt / FCF = 8.89 (Net Debt 42.0b / FCF TTM 4.72b)
Total Stockholder Equity = 15.9b (last 4 quarters mean from totalStockholderEquity)
RoA = -3.64% (Net Income -3.43b / Total Assets 89.5b)
RoE = -21.53% (Net Income TTM -3.43b / Total Stockholder Equity 15.9b)
RoCE = 4.92% (EBIT 2.17b / Capital Employed (Equity 15.9b + L.T.Debt 28.1b))
RoIC = 2.07% (NOPAT 1.53b / Invested Capital 73.9b)
WACC = 3.77% (E(23.1b)/V(72.8b) * Re(5.80%) + D(49.7b)/V(72.8b) * Rd(3.99%) * (1-Tc(0.29)))
Discount Rate = 5.80% (= CAPM, Blume Beta Adj.)
Shares (quarterly) Correlation: -43.53 | Cagr: -0.20%
[DCF] Terminal Value 75.09% ; FCFF base≈4.77b ; Y1≈4.68b ; Y5≈4.75b
[DCF] Fair Price = 5.74 (EV 74.3b - Net Debt 42.0b = Equity 32.3b / Shares 5.64b; r=8.35% [WACC [floored]]; 5y FCF grow -2.54% → 2.50% )
EPS Correlation: N/A | EPS CAGR: N/A | SUE: -0.91 | # QB: -2
Revenue Correlation: -80.51 | Revenue CAGR: -4.32% | SUE: 0.00 | # QB: 0
EPS current Quarter (2026-06-30): EPS=0.11 | Chg30d=+0.00% | Revisions=N/A | Analysts=1
EPS next Quarter (2026-09-30): EPS=0.12 | Chg30d=+9.09% | Revisions=+20% | Analysts=1
EPS current Year (2026-12-31): EPS=0.34 | Chg30d=-3.25% | Revisions=-33% | GrowthEPS=+4.5% | GrowthRev=-3.8%
EPS next Year (2027-12-31): EPS=0.39 | Chg30d=+1.37% | Revisions=+0% | GrowthEPS=+14.0% | GrowthRev=+1.3%
[Analyst] Revisions Ratio: -33%