Deutsche Telekom is making a powerful statement to financial markets through unprecedented shareholder returns. The Bonn-based telecommunications giant announced its highest dividend payment in company history alongside a multi-billion euro share repurchase program, rewarding investors for the firm’s record-breaking financial performance in 2024.
Strategic Vision Through 2027: Fiber and AI Driving Growth
What underpins the sustainability of these generous shareholder returns? CEO Tim Höttges outlined four strategic pillars designed to secure growth through 2027 during the company’s Capital Markets Day:
- Accelerated fiber-optic expansion targeting 2.5 million new connections
- Maintaining mobile technology leadership across all core markets
- Enhancing customer experience through digital transformation
- Systematic implementation of artificial intelligence across operations
“We are still at the beginning of these developments,” Höttges stated, adding that he is “already pushing strongly for acceleration in these areas.” The company’s US subsidiary, T-Mobile, contributed significantly to the positive results with an impressive 8.3% EBITDA growth.
Record Financials Fuel Capital Return Program
The company’s financial achievements tell a compelling story. Deutsche Telekom delivered the strongest results in its three-decade history during the 2024 fiscal year, generating €19.2 billion in free cash flow and achieving 6.5% EBITDA growth. This robust financial foundation provides the necessary resources for the ambitious capital return initiative.
Key components of the shareholder reward package include:
- Dividend increase: A 17% rise from €0.77 to €0.90 per share
- Buyback program: Up to €2 billion allocated for share repurchases in 2025
- Total distribution: Dividend payments amounting to approximately €4.4 billion
Höttges emphasized that “this dividend increase is based on the excellent business development in 2024 and our positive outlook.” The final dividend approval will occur alongside the release of definitive annual figures.
Should investors sell immediately? Or is it worth buying Deutsche Telekom?
Technical Perspective: Overbought but Fundamentally Sound
Currently trading at €29.70, Deutsche Telekom shares show technical indicators of being overbought with an RSI reading of 85.6. However, several factors provide underlying support:
- Trading just 7.8% above the 52-week low of €27.55
- Remaining 17% below the yearly peak of €35.78
- Slightly under the 50-day moving average of €30.20
The stock’s volatility of 16.4% reflects the ongoing tension between short-term overbought conditions and long-term fundamental value.
Forward Guidance and Key Milestones
Looking ahead to 2025, Deutsche Telekom forecasts group EBITDA of €44.9 billion and free cash flow of €19.9 billion. The company anticipates adjusted earnings per share of approximately €2.00, creating a solid foundation for continued shareholder-friendly policies.
Important upcoming events for investors to monitor:
- Annual General Meeting on April 9, 2025, featuring the dividend decision
- Q1 2025 results publication on May 15, 2025
- Continuation of the share buyback program through year-end 2025
The combination of record profits, historic dividends, and substantial buybacks demonstrates Deutsche Telekom’s serious commitment to shareholder returns. The remaining question is whether the share price will follow this fundamentally positive trajectory.
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