Deutsche Telekom shares: Price analysis before buying or selling

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Yes

ISIN code: DE0005557508

Ticker: ETR: DTE

Index or market: DAX

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Elements to consider before selling or buying Deutsche Telekom shares

Analysis N°1

First of all, keep an eye on the evolution of demand for 4G technologies across the world as well as the developments of 5G networks and the technologies associated with them.

Analysis N°2

The strategic buyouts of smaller companies and all the investments made by the Deutsche Telekom group should of course be the subject of your attention as these have the main effect of strengthening the presence of this company in the world or of diversifying its product line.

Analysis N°3

You should also closely monitor the growth and development of telecommunications services for businesses and professionals, as Deutsche Telekom enjoys a significant presence in this segment.

Analysis N°4

The growth or rather the current global economic slowdown is a sign to watch closely given the repercussions this may have on Deutsche Telekom's business operations.

Analysis N°5

Studying the competition is also important for this fundamental analysis in view of its aggressiveness in this sector and the potential reduction in margins that it implies for the German telecoms company.

Analysis N°6

Finally, you should closely follow the various regulations put in place by governments as well as the increasingly strict directives of certain countries which prevent the good establishment of the company.

Analysis before buying or selling Deutsche Telekom shares

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General presentation of Deutsche Telekom

If you want to study the future price movements of Deutsche Telekom shares, you must of course have a good knowledge of this company and its main activities and sources of income. That is why we are now offering you an insight into the company and its activities.

The Deutsche Telekom Group is a German company specialising in the telecommunications sector. More specifically, the company is currently one of the world's leading and largest telecommunications operators.

In order to better understand Deutsche Telekom's activities, they can be divided into different divisions according to the share of turnover they generate and in this way:

Telecommunications services represent the largest part of the group's activities with 95.2% of turnover. This includes mobile telephony services with 248.2 million subscribers, fixed telephony services with 26.1 million subscribers, data transmission services, Internet access services, website hosting and messaging services. The group also sells mobile handsets, accessories and communication equipment.
The development of information and communication systems generates 4.4% of the group's turnover and is carried out through Deutsche Telekom's subsidiary T-Systems.
The remaining 0.4% of turnover comes from ancillary activities.

It is also interesting to know the geographical distribution of the group's revenues. Only 23.1% of its turnover is generated in Germany. The rest comes from the rest of Europe for 13.7%, the North American market for 62.8% and the rest of the world for 0.4%.

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The major competitors of Deutsche Telekom

Deutsche Telekom is a German telecommunications operator which is positioned among the leaders in this sector worldwide. However, it is interesting to know who your main competitors are before you start trading your stock.

Telefonica and Orange

Regarding the telecommunications market in Europe, Deutsche Telekom is number one in terms of turnover and is positioned just ahead of the Spanish operator Telefonica and the French operator Orange.

Vodafone

In the rest of the world, Deutsche Telekom is positioned in 5th place just before Vodafone. It is preceded by AT&T and Verizon Telecommunications in the United States, China Mobile Communications in China and Nippon Telegraph and Telephone in Japan.

The major partners of Deutsche Telekom

Colt Technology

In 2015, Colt technology and Deutsche Telekom's international business solutions subsidiary signed a 5-year partnership for international telephony services. This alliance will help Colt technology to develop in the market thanks to the German operator's networks.

Orange, Singel and Telefonica

Also in 2015, Deutsche Telekom and some of its competitors such as Orange, Singtel and Telefonica set up a strategic alliance and created Go Ignite, a process for connecting start-up ecosystems through 'Asia, Africa, Europe, the Middle East and Latin America.

DocuSign

In 2016, Deutsche Telekom became a partner of DocuSign in order to be a reseller of this company's digital transaction management solutions. This will enable it to improve data security by making its data centres available to the Global Trust Network of the firm DocuSign.

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The factors in favour of a rise in the Deutsche Telekom share price:

First, the Deutsche Telekom group has a very large customer base in the field of mobile communication. Thanks to this basis, the group is able to market other types of products and services without having to recruit new users and customers. This of course represents a very interesting development opportunity.

We also know that mobile Internet services are currently booming in Europe. This specificity is another strong point for Deutsche Telekom, which carries out its main activities in this field and should therefore take advantage of it to increase its profits.

From a geographical point of view, the Deutsche Telekom group also has a very good distribution of its activities throughout the world. The company offers its services and products in more than fifty countries, mainly Germany of course, but also the United States, Asia and other parts of the world. This protects the group from the hazards of the single national market.

Owning the T-Mobile brand also gives Deutsche Telekom a strong brand image throughout Germany and the surrounding countries. This has allowed it to become increasingly known among young clientele and therefore ensure a significant renewal of its client portfolio.

The diversity of the offers offered by Deutsche Telekom at the present time is also appreciated, especially with presence in mobile telephony, terrestrial telephony and digital television services. This diversity once again protects the company from the risks associated with a single sector.

Finally, the analysts of this value also appreciate the efforts made by the company aimed at winning new customers, particularly with significant investments in communications. Deutsche Telekom broadcasts various advertisements via TVCs, print advertisements, online advertisements or its sponsorship offers.

The factors in favour of a drop in the Deutsche Telekom share price:

First of all, the competition in this sector of activity is one of the main weak points of the Deutsche Telekom group. The group has many large adversaries, whether in Germany or in Europe, which makes it more complicated for the company to conquer new market shares.

Finally, although, as we've seen above, Deutsche Telekom is able to establish itself in various countries around the world, its infiltration into international markets remains more complicated than for other major brands in this sector. This is of course another weak point for the company, which has little chance of gaining larger market shares outside the German national market.

Although these weaknesses are much less numerous than the qualities of the Deutsche Telekom group, it should be taken into account when setting up your trading strategies.

The information supplied here is only for indicative purposes and should not be used without the completion of a comprehensive and complete fundamental analysis of this asset notably taking into account exterior data, future publications and announcements and all fundamental events and news that could influence the strengths and weaknesses or make them more or less significant. This information does not in any way constitute recommendations relating to the completion of transactions or a solicitation to buy or sell an asset.

Frequently Asked Questions

How is Deutsche Telekom's capital distributed?

Deutsche Telekom Group has several major shareholders in its capital, including the German State, which still holds 31.9% of the shares, but also The Vanguard Group, which holds 2%, Norges Bank Investment Management, with 1.66% of the shares, DWS Investment, with 1.51% of the shares, BNP Paribas Asset Management France, with 1.16%, BlackRock Asset Management Deutscheland, with 1.11%, Amundi Asset Management S, with 1% of the shares, DWS Investments, with 0.98%, BlackRock Investment Management, with 0.97%, and Deka Investment, which holds 0.86%.

How are the activities of the Deutsche Telekom Group organised?

The Deutsche Telekom group has organised its activities into four different divisions, including T-Com, which covers the traditional telephone network, T-Mobile, which covers mobile telephony activities, T-Online, which is in charge of the Internet and includes the subsidiary AutoScout24 and all the sites of the Scout24 group, and T-Systems, which concerns large business customers as well as the research and development department.

Where to buy and sell Deutsche Telekom shares?

If you want to invest in the Deutsche Telekom share price, there are several ways to do so. You can add the share to your PEA or stock account, but you can also speculate on the rise or fall of the share price by using derivatives such as online CFDs.

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Analysis before buying or selling Deutsche Telekom shares