Telefónica rises 2.35% in the Ibex 35 to €3.30, in line with European telecoms. The average target price set by analysts is €4.
Telefónica rises 2.35% by mid-morning, reaching €3.30 in the Ibex 35. According to Estrategias de Inversión, this movement is part of a general recovery of European operators in this Thursday's session.
The company is not alone in its advance. The German Deutsche Telekom rises 2.93%, the French Orange gains 2.96%, and the British Vodafone advances 2.46%.
The sector had fallen the previous week after it was revealed that SpaceX had purchased a portfolio of low-frequency spectrum licenses with nationwide coverage in the United States. With this purchase, the firm will be able to develop Starlink Mobile as a mobile phone operator, although for now only in the United States.
According to data compiled by Reuters, the analysis firms following the stock set an average target price of €4, which implies a 20.5% potential on the stock market from current levels. The majority recommendation is to hold: there is 1 strong buy recommendation, 3 buy recommendations, 15 hold recommendations, 4 sell recommendations, and 1 strong sell recommendation.
Analyst María Mira points out that the stock is trading at a discount based on PER and EV/EBITDA and offers a dividend yield of over 4%. Its balance sheet improves quarter by quarter, although the accounting result will continue to be affected by the extraordinary costs of the restructuring.
Among the catalysts, Mira cites the closure of the sale in Mexico and the rest of the divestments in Latin America, the strength of Brazil, and the synergies of the new structure in Spain. As risks, she mentions erosion in Germany, competition from Digi in Spain, and indebtedness in a higher interest rate environment.
On the technical side, analyst José Luis Herrera indicates that the stock is supported by its long-term upward trend line. The first relevant resistance is at €3.35 and then at €3.45. The critical support is at €3.20, a level that should not be lost at the weekly close to validate a new upward phase.
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