Deutsche Telekom AG (DTEGn.DE): Fears dominate the narrative, but operations remain strong

Research evidence excerpt

Deutsche Telekom AG (DTEGn.DE): Fears dominate the narrative, but operations remain strong

Deutsche Telekom AG (DTEGn.DE)

13 July 2026 Citi Research

TMUS – growing well in “the best telco market in the world”,

but investor concerns linger around LEO satellite,

competition, and press reports of possible DT/TMUS merger

At our TMT conference in March 2026, DT CEO Tim Höttges described the US as

the “best telco market in the world”. He argued that its attractions relative to

Europe include much greater scale, greater willingness of customers to pay, lower

levels of regulatory complexity, and greater flexibility in the labour market.

DT was keen to point to its vote of confidence in the US market, through its

decision announced in February 2026, that it would not participate in the TMUS

buyback in 2026. As at 24 April 2026, DT owned 53.8% of TMUS, meaning TMUS’

minorities represent c$90bn of TMUS’s sub-$200bn market cap. TMUS has

authorized up to $18.2bn of shareholder returns for 2026 (dividend and buyback).

However, given the pace at which it has started this programme, Citi forecasts

share repurchases of $19.2bn in 2026.

TMUS’s targets provided at its CMD update in February 2026 were for 2023-2027

CAGRs ex-M&A of 5% at revenue and 7% at core adj. EBITDA, at the mid-point.

These reaffirmed the opportunity to organically grow service revenue in the mid-

single digits in 2026 and 2027, while delivering an average incremental margin of

70% over the two years to support margin and FCF expansion.

TMUS remains well positioned to take share within mobile and broadband, deliver

stronger reported growth on the heels of its completed acquisitions, and improve

efficiency. However, the degree of potential upside on postpaid phone/account