DEUTSCHE TELEKOM AG-REG (DTE.DE) Stock Fundamental Analysis
Europe - Frankfurt Stock Exchange - FRA:DTE - DE0005557508 - Common Stock
27.06 EUR
+0.21 (+0.78%)
We assign a fundamental rating of 5 out of 10 to DTE. DTE was compared to 35 industry peers in the Diversified Telecommunication Services industry. While DTE belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. DTE has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
- In the past year DTE was profitable.
- DTE had a positive operating cash flow in the past year.
- In the past 5 years DTE has always been profitable.
- DTE had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- DTE's Return On Assets of 4.20% is in line compared to the rest of the industry. DTE outperforms 52.78% of its industry peers.
- DTE's Return On Equity of 19.80% is fine compared to the rest of the industry. DTE outperforms 69.44% of its industry peers.
- DTE has a Return On Invested Capital of 7.86%. This is in the better half of the industry: DTE outperforms 75.00% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for DTE is below the industry average of 8.42%.
- The 3 year average ROIC (5.80%) for DTE is below the current ROIC(7.86%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.2% | ||
| ROE | 19.8% | ||
| ROIC | 7.86% |
ROA(3y)4.16%
ROA(5y)3.11%
ROE(3y)21.81%
ROE(5y)17.36%
ROIC(3y)5.8%
ROIC(5y)5.16%
1.3 Margins
- Looking at the Profit Margin, with a value of 10.20%, DTE is in the better half of the industry, outperforming 61.11% of the companies in the same industry.
- In the last couple of years the Profit Margin of DTE has grown nicely.
- DTE has a better Operating Margin (22.62%) than 77.78% of its industry peers.
- In the last couple of years the Operating Margin of DTE has grown nicely.
- Looking at the Gross Margin, with a value of 61.45%, DTE is in the better half of the industry, outperforming 61.11% of the companies in the same industry.
- In the last couple of years the Gross Margin of DTE has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 22.62% | ||
| PM (TTM) | 10.2% | ||
| GM | 61.45% |
OM growth 3Y19.59%
OM growth 5Y10.99%
PM growth 3Y35.63%
PM growth 5Y15.06%
GM growth 3Y2.66%
GM growth 5Y1.43%
2. Health
2.1 Basic Checks
- The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so DTE is still creating some value.
- Compared to 1 year ago, DTE has less shares outstanding
- Compared to 5 years ago, DTE has more shares outstanding
- The debt/assets ratio for DTE has been reduced compared to a year ago.
2.2 Solvency
- Based on the Altman-Z score of 1.06, we must say that DTE is in the distress zone and has some risk of bankruptcy.
- DTE has a Altman-Z score of 1.06. This is comparable to the rest of the industry: DTE outperforms 47.22% of its industry peers.
- The Debt to FCF ratio of DTE is 6.50, which is on the high side as it means it would take DTE, 6.50 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of DTE (6.50) is better than 69.44% of its industry peers.
- DTE has a Debt/Equity ratio of 2.03. This is a high value indicating a heavy dependency on external financing.
- The Debt to Equity ratio of DTE (2.03) is worse than 83.33% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.03 | ||
| Debt/FCF | 6.5 | ||
| Altman-Z | 1.06 |
ROIC/WACC1.38
WACC5.7%
2.3 Liquidity
- DTE has a Current Ratio of 1.00. This is a normal value and indicates that DTE is financially healthy and should not expect problems in meeting its short term obligations.
- With a decent Current ratio value of 1.00, DTE is doing good in the industry, outperforming 77.78% of the companies in the same industry.
- A Quick Ratio of 0.93 indicates that DTE may have some problems paying its short term obligations.
- Looking at the Quick ratio, with a value of 0.93, DTE is in the better half of the industry, outperforming 75.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1 | ||
| Quick Ratio | 0.93 |
3. Growth
3.1 Past
- The Earnings Per Share has grown by an nice 13.60% over the past year.
- Measured over the past years, DTE shows a quite strong growth in Earnings Per Share. The EPS has been growing by 12.65% on average per year.
- Looking at the last year, DTE shows a small growth in Revenue. The Revenue has grown by 3.58% in the last year.
- The Revenue has been growing slightly by 7.53% on average over the past years.
EPS 1Y (TTM)13.6%
EPS 3Y15.65%
EPS 5Y12.65%
EPS Q2Q%17.02%
Revenue 1Y (TTM)3.58%
Revenue growth 3Y2.47%
Revenue growth 5Y7.53%
Sales Q2Q%1.52%
3.2 Future
- Based on estimates for the next years, DTE will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.45% on average per year.
- DTE is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.92% yearly.
EPS Next Y6.17%
EPS Next 2Y8.6%
EPS Next 3Y9.73%
EPS Next 5Y11.45%
Revenue Next Year2.41%
Revenue Next 2Y2.8%
Revenue Next 3Y3%
Revenue Next 5Y2.92%
3.3 Evolution
- The EPS growth rate is stable: in the next years the growth will be about the same than in the last years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 13.33, DTE is valued correctly.
- 63.89% of the companies in the same industry are more expensive than DTE, based on the Price/Earnings ratio.
- DTE is valuated cheaply when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- The Price/Forward Earnings ratio is 12.16, which indicates a correct valuation of DTE.
- Based on the Price/Forward Earnings ratio, DTE is valued a bit cheaper than 63.89% of the companies in the same industry.
- DTE is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 13.33 | ||
| Fwd PE | 12.16 |
4.2 Price Multiples
- DTE's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. DTE is cheaper than 80.56% of the companies in the same industry.
- Based on the Price/Free Cash Flow ratio, DTE is valued cheaply inside the industry as 86.11% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.19 | ||
| EV/EBITDA | 5.08 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- DTE has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)2.16
PEG (5Y)1.05
EPS Next 2Y8.6%
EPS Next 3Y9.73%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 3.72%, DTE has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 3.26, DTE has a dividend in line with its industry peers.
- DTE's Dividend Yield is rather good when compared to the S&P500 average which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.72% |
5.2 History
- On average, the dividend of DTE grows each year by 8.56%, which is quite nice.
Dividend Growth(5Y)8.56%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
- 53.30% of the earnings are spent on dividend by DTE. This is a bit on the high side, but may be sustainable.
- DTE's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP53.3%
EPS Next 2Y8.6%
EPS Next 3Y9.73%
DEUTSCHE TELEKOM AG-REG / DTE.DE FAQ
What is the ChartMill fundamental rating of DEUTSCHE TELEKOM AG-REG (DTE.DE) stock?
ChartMill assigns a fundamental rating of 5 / 10 to DTE.DE.
What is the valuation status of DEUTSCHE TELEKOM AG-REG (DTE.DE) stock?
ChartMill assigns a valuation rating of 6 / 10 to DEUTSCHE TELEKOM AG-REG (DTE.DE). This can be considered as Fairly Valued.
Can you provide the profitability details for DEUTSCHE TELEKOM AG-REG?
DEUTSCHE TELEKOM AG-REG (DTE.DE) has a profitability rating of 7 / 10.
What is the valuation of DEUTSCHE TELEKOM AG-REG based on its PE and PB ratios?
The Price/Earnings (PE) ratio for DEUTSCHE TELEKOM AG-REG (DTE.DE) is 13.33 and the Price/Book (PB) ratio is 2.18.
How sustainable is the dividend of DEUTSCHE TELEKOM AG-REG (DTE.DE) stock?
The dividend rating of DEUTSCHE TELEKOM AG-REG (DTE.DE) is 6 / 10 and the dividend payout ratio is 53.3%.