As of June 21, 2025, Telefonica Deutschland Holding AG's estimated intrinsic value ranges from $1.61 to $33.29 per share, depending on the valuation methodology applied.
| Valuation Method | Fair Value (USD) | Implied Upside/Downside |
|---|---|---|
| Discounted Cash Flow (10Y) | $2.81 | +15.6% |
| Discounted Cash Flow (5Y) | $1.61 | -33.7% |
| Dividend Discount Model (Multi-Stage) | $2.62 | +7.7% |
| Dividend Discount Model (Stable) | $2.00 | -17.8% |
| Earnings Power Value | $33.29 | +1269.9% |
Is Telefonica Deutschland Holding AG (O2D.DE) undervalued or overvalued?
With the current market price at $2.43, the stock appears to be significantly undervalued.
Intrinsic value represents the "true" worth of a company based on its fundamentals rather than market sentiment. We've employed multiple methodologies to triangulate Telefonica Deutschland Holding AG's intrinsic value, including:
The cost of capital is a critical factor in valuation models, representing the required return for investors.
| WACC Component | Low | High |
|---|---|---|
| Long-term bond rate | 2.6% | 3.1% |
| Equity market risk premium | 5.1% | 6.1% |
| Adjusted beta | 0.5 | 0.63 |
| Cost of equity | 5.2% | 7.5% |
| Cost of debt | 4.0% | 4.8% |
| Tax rate | 20.7% | 26.2% |
| Debt/Equity ratio | 0.64 | 0.64 |
| After-tax WACC | 4.4% | 6.0% |
Our DCF model projects cash flows over 5-year and 10-year horizons, with the following key assumptions:
| DCF Model | Fair Value | Enterprise Value | % from Terminal Value |
|---|---|---|---|
| 5-Year Growth | $2 | $8,840M | 84.6% |
| 10-Year Growth | $3 | $12,404M | 76.3% |
| 5-Year EBITDA | $2 | $8,590M | 84.1% |
| 10-Year EBITDA | $2 | $10,071M | 70.8% |
The DDM values a company based on its expected future dividend payments. We used two approaches:
EPV assesses a company's value based on its current normalized earnings power, assuming no growth.
| EPV Component | Value |
|---|---|
| Normalized Earnings | $5,228M |
| Discount Rate (WACC) | 6.0% - 4.4% |
| Enterprise Value | $87,730M - $118,408M |
| Net Debt | $4,051M |
| Equity Value | $83,679M - $114,357M |
| Outstanding Shares | 2,975M |
| Fair Value | $28 - $38 |
| Selected Fair Value | $33.29 |
| Metric | Value |
|---|---|
| Market Capitalization | $7228M |
| Enterprise Value | $11279M |
| Trailing P/E | 31.29 |
| Forward P/E | 36.36 |
| Trailing EV/EBITDA | 4.75 |
| Current Dividend Yield | 740.16% |
| Dividend Growth Rate (5Y) | -9.65% |
| Debt-to-Equity Ratio | 0.64 |
To determine the most reliable intrinsic value estimate, we weigh each valuation method based on:
| Valuation Method | Weight | Weighted Value |
|---|---|---|
| Discounted Cash Flow (10Y) | 30% | $0.84 |
| Discounted Cash Flow (5Y) | 25% | $0.40 |
| Dividend Discount Model (Multi-Stage) | 20% | $0.52 |
| Dividend Discount Model (Stable) | 15% | $0.30 |
| Earnings Power Value | 10% | $3.33 |
| Weighted Average | 100% | $5.40 |
Based on our comprehensive valuation analysis, Telefonica Deutschland Holding AG's weighted average intrinsic value is $5.40, which is approximately 122.1% above the current market price of $2.43.
Key investment considerations:
Given these factors, we believe Telefonica Deutschland Holding AG is currently significantly undervalued with the potential for long-term appreciation based on the company's growth trajectory and financial strength.