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    Deutsche Telekom (XTRA:DTE): Rethinking Valuation After New OpenAI Partnership and Expanded AI Strategy

    Simply Wall St·12/11/2025 04:48:03
    語音播報

    Deutsche Telekom (XTRA:DTE) just stepped up its AI game, unveiling a multi year collaboration with OpenAI that gives it early access to an alpha phase model and an organisation wide ChatGPT Enterprise rollout.

    See our latest analysis for Deutsche Telekom.

    The OpenAI deal lands after a choppy stretch for the stock, with the share price now at $26.86 and momentum softening in recent months despite a strong five year total shareholder return above 100 percent, suggesting the longer term thesis remains intact.

    If this AI push has you rethinking your exposure to digital infrastructure and automation, it might be worth exploring other high growth tech and AI names through high growth tech and AI stocks.

    With the shares down over the past year yet still trading at a hefty intrinsic discount and nearly 40 percent below analyst targets, is Deutsche Telekom quietly undervalued, or is the market already pricing in years of AI-fueled growth?

    Most Popular Narrative: 29.4% Undervalued

    With Deutsche Telekom last closing at €26.86 versus a narrative fair value of about €38.07, the gap points to a sizable potential upside if the thesis plays out.

    Rapid AI and digital transformation initiatives including AI powered network management, customer support automation, and industrial AI collaborations (notably with NVIDIA) are expected to materially lower operating costs and increase efficiency, supporting margin expansion and higher free cash flow in the medium to long term.

    Read the complete narrative.

    Curious how modest revenue growth, shifting profit margins, and a richer future earnings multiple still add up to that higher value? The narrative’s math might surprise you. Want to see exactly which long term assumptions make the upside case hang together? Dive in and unpack the full story behind this valuation call.

    Result: Fair Value of $38.07 (UNDERVALUED)

    Have a read of the narrative in full and understand what's behind the forecasts.

    However, persistent German broadband saturation and heavy fiber build costs, coupled with Deutsche Telekom’s reliance on T Mobile US, could undermine the upside narrative.

    Find out about the key risks to this Deutsche Telekom narrative.

    Build Your Own Deutsche Telekom Narrative

    If you are not fully aligned with this take, or simply prefer digging into the numbers yourself, you can build a custom narrative in just a few minutes: Do it your way.

    A great starting point for your Deutsche Telekom research is our analysis highlighting 6 key rewards and 1 important warning sign that could impact your investment decision.

    Looking for more investment ideas?

    Before you move on, lock in your next edge by scanning focused stock shortlists built from real fundamentals, not hype, so opportunity does not slip past you.

    This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.