Spain’s credit rating upgraded to ’A+’ by S&P on strong growth
Investing.com - Deutsche Bank downgraded Telenor ASA (OTC:TELNY) from Buy to Hold on Friday, while raising its price target to NOK163.00 from NOK154.00.
The rating change follows Telenor’s 26% year-to-date outperformance compared to the broader telecommunications sector, which Deutsche Bank cited as the primary reason for the downgrade.
Deutsche Bank initially upgraded Telenor to Buy in April 2024, but now considers the valuation "less compelling" with a 2027E ex-EM unlevered free cash flow yield of 5.5%.
The bank noted that Telenor’s headline free cash flow remains dependent on emerging markets, which account for approximately 40% of the group’s equity free cash flow.
Deutsche Bank also highlighted that consolidation prospects have been an important share price driver, with potential for 5-9% equity free cash flow per share accretion from a Swedish deal, though the analyst firm believes Telenor shares have already rallied on this possibility.
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