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Telefonica
(BME:TEF)
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Rating:47Neutral
Price Target:
€3.00
▼(-16.67% Downside)
Action:Reiterated
Date:07/30/26
The score is held down primarily by weak financial performance: sustained net losses and elevated leverage with a shrinking equity base outweigh the benefit of positive (but declining) free cash flow. Technicals are mixed around key moving averages, offering only a neutral contribution. Valuation is helped by the high dividend yield, but the negative P/E (losses) limits how supportive valuation can be.
Positive Factors
Recurring diversified services
Telefónica operates across recurring consumer, enterprise, wholesale, and bundled connectivity services. This diversified revenue model can support customer retention and cash visibility, while fiber, mobile, cloud, cybersecurity, and IoT offerings provide multiple avenues for ongoing customer monetization.
Negative Factors
Persistent net losses
Sustained negative net margins show that operating profitability is not translating into shareholder earnings. Continued losses can weaken retained capital, restrict financial flexibility, and make it harder for Telefónica to fund growth or maintain distributions without relying on other resources.
Read all positive and negative factors
Positive Factors
Negative Factors
Recurring diversified services
Telefónica operates across recurring consumer, enterprise, wholesale, and bundled connectivity services. This diversified revenue model can support customer retention and cash visibility, while fiber, mobile, cloud, cybersecurity, and IoT offerings provide multiple avenues for ongoing customer monetization.
Read all positive factors
Telefonica (TEF) vs. iShares MSCI Spain ETF (EWP)
Market Cap
€19.22B
Dividend Yield7.96%
Average Volume (3M)13.08M
Price to Earnings (P/E)―
Beta (1Y)0.52
Revenue Growth-10.88%
EPS Growth-40.72%
CountryES
Employees74,427
SectorGeneral
Sector StrengthN/A
IndustryTelecommunications Services
Share Statistics
EPS (TTM)-0.58
Shares Outstanding5,670,161,600
10 Day Avg. Volume12,259,946
30 Day Avg. Volume13,075,833
Financial Highlights & Ratios
PEG Ratio>-0.01
Price to Book (P/B)1.38
Price to Sales (P/S)0.56
P/FCF Ratio4.22
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
€3.88Price Target Upside7.78% Upside
Rating ConsensusHold
Number of Analyst Covering5
EPS Forecast (FY)0.33
Revenue Forecast (FY)€33.46B
Telefonica Business Overview & Revenue Model
Company Description
Telefónica, S.A., along with its affiliated companies, provides an extensive portfolio of telecommunications services across both Europe and Latin America. Its mobile division offers a wide array of solutions, including voice communication, value-...
How the Company Makes Money
Telefónica makes money primarily by selling telecommunications and digital services through recurring subscriptions, usage-based charges, and contracted enterprise services.
1) Consumer telecommunications services (core revenue):
- Mobile service...
Telefonica Financial Statement Overview
Summary
Income Statement
38
Negative
Balance Sheet
34
Negative
Cash Flow
62
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 34.93B | 35.12B | 41.31B | 40.65B | 39.99B | 39.28B |
| Gross Profit | 2.55B | 2.60B | 28.76B | 20.23B | 27.05B | 27.02B |
| EBITDA | 8.79B | 8.83B | 12.35B | 10.34B | 14.79B | 22.53B |
| Net Income | -3.30B | -4.32B | -49.00M | -892.00M | 2.01B | 8.14B |
Balance Sheet | ||||||
| Total Assets | 88.60B | 92.02B | 100.50B | 104.32B | 109.64B | 109.21B |
| Cash, Cash Equivalents and Short-Term Investments | 5.86B | 7.43B | 9.26B | 7.67B | 9.69B | 12.41B |
| Total Debt | 49.24B | 39.65B | 45.02B | 44.35B | 8.68B | 50.37B |
| Total Liabilities | 77.83B | 74.21B | 77.75B | 77.23B | 77.93B | 80.53B |
| Stockholders Equity | 7.13B | 14.26B | 19.35B | 14.30B | 25.09B | 22.21B |
Cash Flow | ||||||
| Free Cash Flow | 4.21B | 4.67B | 5.20B | 5.49B | 5.30B | 4.10B |
| Operating Cash Flow | 9.30B | 9.72B | 10.99B | 11.65B | 10.81B | 10.27B |
| Investing Cash Flow | -4.06B | -4.59B | -5.22B | -4.29B | -5.33B | 5.90B |
| Financing Cash Flow | -6.99B | -6.41B | -4.67B | -7.19B | -7.92B | -12.99B |
Telefonica Technical Analysis
Neutral
3.60
Price Trends
3.52
Negative
3.58
Negative
3.59
Negative
Market Momentum
-0.03
Negative
54.63
Neutral
90.74
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For ES:TEF, the sentiment is Neutral. The current price of 3.6 is above the 20-day moving average (MA) of 3.36, above the 50-day MA of 3.52, and above the 200-day MA of 3.59, indicating a neutral trend. The MACD of -0.03 indicates Negative momentum. The RSI at 54.63 is Neutral, neither overbought nor oversold. The STOCH value of 90.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for ES:TEF.
Telefonica Risk Analysis
Telefonica disclosed 16 risk factors in its most recent earnings report. Telefonica reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Telefonica Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
71 Outperform | €11.13B | 25.18 | 25.11% | 0.47% | 23.99% | 16.97% | |
66 Neutral | €7.94B | 12.48 | 11.66% | 5.43% | 14.82% | 35.60% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% | |
53 Neutral | €14.49M | 11.66 | 22.96% | 0.43% | 1.38% | 35.91% | |
47 Neutral | €19.22B | -5.87 | -24.69% | 7.96% | -10.88% | -40.72% | |
45 Neutral | €361.08M | 44,000.00 | -1.12% | 21.74% | -37.43% | -109.98% |
* General Sector Average
ES:TEF
Telefonica
3.48
-0.80
-18.74%
ES:AMP
Amper SA
4.35
0.92
26.71%
ES:IDR
Indra Sistemas
62.10
17.65
39.70%
ES:RED
Redeia Corporación
14.84
-1.16
-7.26%
ES:PAR
Parlem Telecom Companyia de Telecomunicacions SA
0.87
-1.98
-69.45%
ES:LLN
LleidaNetworks Serveis Telematics SA
0.90
-0.66
-42.31%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.