reports
- James Ratzer
European Telecoms for 2026 Industry action required for further outpe...
Over the past 3 years, the EU telecoms sector has had a great run – up >50%, despite modest underlying revenue/ EBITDA growth. This has almost entirely come from a deserved upwards re-rating in the multiple as the risk profile across the sector diminishes – which has been a key theme of ours in the past few years given improved regulation. So, we feel this has now largely played out.
- Russell Waller
- Russell Waller
Altice France Bonds (Equal Weight) Altice France Equity (Neutral, TP: ...
The valuation of fibre assets is important for all Telco investors, but especially those looking at Altice France and Altice International. In this report we look at recent fibre deals and see if we can draw any conclusions Over a month has now passed since the consortium bid for SFR (HERE); whilst face-to-face negotiations do not appear to be happening (as per Q3 calls), it would appear that negotiations via the press are in full swing – HERE and HERE – and back channel discussions are ongoing ...
- Russell Waller
- Russell Waller
Altice France Bonds (Equal Weight) Altice France Equity (Neutral, TP: ...
The valuation of fibre assets is important for all Telco investors, but especially those looking at Altice France and Altice International. In this report we look at recent fibre deals and see if we can draw any conclusions from those deals about future valuations.
- Russell Waller
Orange (Buy, TP: €16.2, +15%) Q3 25: Solid numbers, Group EBITDAaL gui...
Orange has reported a solid set of results, with Telco revenue and EBITDA in-line with consensus expectations; Bank losses are lower than expected and Group EBITDAaL guidance has been lifted as a result (despite a small downgrade to OBS guidance).
- Russell Waller
Orange (Buy, TP: €16.4, +21%) Bouygues (Buy, TP: €54, +39%) Altice Fra...
After months of speculation, there is finally an offer for SFR in France. The deal structure is a lot more complicated than we thought it would be, but we think the offer is a fair one. We think the offer implies a synergy payment of €4.2bn, and values the SFR equity at €15/share, if XpFibre, UltraEdge, ATS, Intelcia, and FOT are indeed worth €4bn, as the release suggests.
- Russell Waller
- Russell Waller
Altice France equity (Neutral, TP: €10.3, -14%) Altice France bonds (E...
The price war at the low end of the French mobile market, which began at the beginning of summer 2024, and which we have written about extensively (HERE, HERE, HERE and HERE), appears to be coming to an end, thanks to some tariff changes that should lead to higher APRUs. We show some new work on tariffs in France in this short report, that should be good for all the MNOs.
- Russell Waller
Altice France equity (Neutral, TP: €10.3, -14%) Altice France bonds (E...
New Altice France debt and equity is now trading. Given the material change in bond terms, and the creation of a new separately traded equity piece, we reassess our rating, and think that at these levels the bonds look pretty fairly valued, and so take the bond rating to Equal weight from Overweight (the old bonds ended up +20% from the lows), and initiate on the equity with a Neutral, as we think that the equity is already implying a high probability of a deal happening, and see minimal underli...
- Russell Waller
Altice France (Overweight) Bouygues (Buy, TP: €52, +39%) Iliad (Equal ...
There have been a few recent reports that the sale process for XpFibre has heated up. It has been suggested that a sale might eventually be pulled and the stake used as a sweetener in any eventual deal; but actually, a sale could also be the first domino in the whole M&A process, as an XpFibre sale would help to ease leverage concerns that Bouygues might have from acquiring SFR. We still think a SFR-Bouygues deal is more likely than not by year end, and that Bouygues is the best way to play this...
- Russell Waller
Orange (Buy, TP: €15.8, +19%) MasOrange (Equal Weight) It’s not all a...
We have been long-term Buyers of Orange, and are pleased about the YTD share price performance (+37% vs the sector +10%). Some of that outperformance is probably due to the prospect of French market repair (France is 56% of the value), but actually it is the Spanish and AME divisions that cause our target to rise to €15.8 from €14.9 post the Q2 results.
- Russell Waller
Orange (Buy, TP: €14.9, +14%) Q2 25: EBITDA guidance lifted thanks to...
Orange has reported a solid set of results, with Telco EBITDA c+0.3% ahead of consensus, and has lifted Group EBITDAaL guidance thanks to AME. French KPIs are solid, but French retail SR growth has turned negative y/y. There are some encouraging signs on French front-book low-end mobile pricing in July (HERE), but clearly overall conditions remain difficult (albeit Orange is doing a good job of off-setting those difficulties at the EBITDAaL level in France).
- Russell Waller
Altice International (Equal Weight) Sale process Hot-ting up in Israe...
Bezeq has confirmed that its subsidiary, Pelephone, has made an offer for Altice International’s Israeli business, Hot Mobile, HERE, for NIS2bn (c€500m). In addition, it seems that Cellcom and Hot have sold their stakes in IBC, HERE. Cellcom has sold its 23% stake for NIS520m (c€130m), and we would assume that Altice has sold its 23% stake for the same amount. In this report we look at the implications of the sales for ATCI lenders.
- Russell Waller
Altice France (Overweight) Iliad (Equal Weight) Bouygues (Buy, TP: €55...
There have been several recent articles about French M&A. The latest article from TMT finance yesterday has some fairly specific details, and most importantly, seems to suggest that the price demanded for SFR is now approaching what we would see as fair value.
- Blair Levin
- Jonathan Chaplin
Mobile and broadband pair trades to consider this summer
While we have been intensively focused on such things as a Presidential intervention to prevent a Chapter 11, we admit that our mind occasionally drifts to thoughts of summer. So to help others who may have similar thoughts, we thought, in honor of summer beginning, we should provide our thoughts as to which alcohols pair best with the purchase of the stocks we cover (actually, we just asked ChatGPT and, given its attitude about intellectual property, we have no fears about just cutting and pas...
- Russell Waller
- Russell Waller
NOS (Sell, TP: €3.11, -18%) Digi (Underweight) Altice International (E...
One of the key questions in European Telecoms at the moment is how successful will Digi be in Portugal, Spain and Belgium; and to a lesser extent, how successful can the challengers be in general: Salt, Iliad Italy, and so on. In this report, we take a top-down look at how spectrum drives success in European mobile, and what that means for future outcomes.
- Russell Waller
Orange (Buy, TP: €15.4, +24%) Q1 25: Solid numbers, guidance reiterat...
Orange has reported a solid set of results, with Telco revenue and EBITDA in-line with consensus expectations; the important French SR trends are slightly weaker (but ahead of consensus expectations), but all guidance for Group and divisions (including France) has been reiterated.
- Ben Rickett
- James Ratzer
- Russell Waller
EU TELCOS: What a recessionary scenario might look like
When the news of the Trump tariffs first hit the tapes, we didn’t write anything initially as a) we didn’t think we had much of value to add to the thousands of column inches already written on the topic, and b) the direct impact from the tariffs to the EU telecoms sector is minimal – resulting in relative outperformance for the group over the past few days.
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