Deutsche Telekom’s Buyback Machine Grinds On as Headwinds Pile Up

Deutsche Telekom spent €45M on share buybacks in a week, yet stock trades near 52-week low amid corruption probe, wage talks, and bearish technicals.

The Deutsche Telekom share buyback programme is running at full throttle, with nearly €45 million spent on repurchasing stock in a single week last month — even as the company’s shares trade near a 52-week low. The disconnect between corporate confidence and market sentiment has rarely been starker.

Between 20 and 24 April, the Bonn-based telecoms giant scooped up roughly 1.58 million of its own shares on Xetra, paying an average price ranging from €27.62 to €29.48 per share. The most active session came on 23 April, when more than 326,000 shares were retired. Those purchases form part of the second tranche of a buyback programme authorised by the board last November for up to €2 billion, with the bulk of the repurchased stock slated for cancellation — a move that mathematically boosts earnings per share. A smaller portion is reserved for employee share schemes and executive compensation.

Yet the timing is awkward. The stock now changes hands at around €26.87, roughly 15% below its 50-day moving average and just a whisker above its 52-week floor of €26.45. The shares have shed about 3.6% since the start of the year and nearly 13% over the past twelve months. The relentless buyback activity, while a testament to healthy cash generation, has so far failed to arrest the slide.

Multiple Fronts, Multiple Pressures

The share price weakness reflects a confluence of challenges. Cologne prosecutors have opened a corruption investigation targeting an employee of a Telekom subsidiary and nine other individuals. The suspect, a 37-year-old, is alleged to have funnelled fibre-optic contracts to a construction company in exchange for kickbacks. The probe was triggered by an anonymous tip-off received internally and passed to the authorities — a sign, analysts note, that the group’s compliance systems are functioning.

Separately, the company is locked in wage negotiations with the Ver.di union, which is demanding a 6.6% pay rise over twelve months, an annual member bonus of €660, and meaningful increases for apprentices. The outcome of those talks will feed directly into the cost base of Telekom’s domestic operations.

Adding to the regulatory headwinds, mobile customers have since 20 April been able to formally document poor network quality using an app from the Federal Network Agency, and can use that evidence to demand price reductions or terminate contracts early. The rule applies across the industry, but Telekom’s extensive coverage — 92.5% of Germany’s landmass with 4G and 87.9% with 5G at the end of 2025 — should limit the financial hit.

Chart Sends a Clear Warning

The technical picture is unambiguously bearish. The stock trades nearly 8% below its 200-day moving average of €29.46, placing it in short-, medium- and long-term downtrends. On 22 April, the price crossed below the 200-day line — a classic sell signal. The 52-week low at €26.45 is now barely 2% away.

The ongoing buyback programme provides a steady source of demand. By the end of February, Telekom had already repurchased more than 11 million shares on Xetra. That support has been insufficient, however, to break the downward momentum.

Analyst Confidence Holds Firm

Despite the market’s gloom, the analyst community remains unanimously bullish. All 18 analysts who regularly cover the stock rate it a buy or overweight, with price targets ranging from €35.70 to €42.00 — all well above current levels.

The next major test comes on 13 May, when Telekom publishes its first-quarter results. The company has guided for a full-year adjusted EBITDA of €47.4 billion and free cash flow of nearly €20 billion. Investors will be watching closely to see whether the Q1 numbers can validate the analysts’ optimism and narrow the yawning gap between the share price and those lofty targets.

For now, the buyback programme remains the most visible signal the company is sending to the capital markets — a signal of confidence that the market, so far, has chosen to ignore.