Telecom plus 110% on the stock market in one year, the slow but constant plan of CEO Pietro Labriola

Telecom plus 110% on the stock market in one year, the slow but constant plan of CEO Pietro Labriola

More than 110% in one year on the stock market. CEO Pietro Labriola’s plan to get Telecom back on track is slow but steady. And so the stock, banks and insurance companies aside, is among the best on the Milanese list in 2025, exceeding, even if slightly, the threshold of 0.505 euros per share which was the price that Kkr wanted to pay for the entire company.

In the end, the US fund failed to make a big splash and had to “settle” for the most valuable asset, i.e. the fixed access network of the ex-monopolist, which brought with it a large portion of the debt (over 25 billion euros) that had made Telecom become the Cinderella of European telecommunications. The debt had accumulated due to a series of wrong choices made by the shareholders who followed one another in command over the years, very interested in earning for themselves (starting with the team led by Roberto Colannino) and little (very little) in the good of the company.

This is why in the end the most difficult decision to make was reached: selling the network, something that no other former European monopolist has done, to collect around 20 billion euros and get the accounts back on track. Fortunately, there is another asset that has survived numerous knife attacks: Tim Brasil. A constantly growing company that produces profits (and, currently the only one of the group, distributes dividends) thanks to the immense user base in Brazil (over 200 million inhabitants). Telecom owns 66% of the company which as a whole is worth over 8 billion euros and has constituted, for approximately half of the current year, almost all of the value expressed by Telecom on the stock exchange. Now the group capitalizes around 12 billion with analysts, who after the decision to convert the savings shares, have increased the target price so much so that Banca Akros has raised it from 0.57 to 0.6 euros per share.

For Equita the conversion is positive because it simplifies the corporate structure and improves liquidity by using part of the proceeds from the concession fee, approximately 720 million, “effectively creating a buyback on the group’s capital compared to an entirely paper operation”. Furthermore, for the ordinary shareholder, Equita explains, the cancellation of savings shares, which are preferred securities, improves earnings per share, expected in 2026, by approximately 10%. Based on the conversion proposal, Poste Italiane’s stake is diluted to 19.6% from the current 27.3% (recently increased due to the purchase of 2.5% from Vivendi), thus returning below the takeover threshold at 25%. The other ordinary shareholders would hold 52.2% of Tim’s capital and the current savings shareholders would have the remaining 28.2%.

Now, say Mediobanca analysts, only announcements of new services and synergies with Poste, or of mergers between operators (perhaps bringing the mobile infrastructure ones from 4 to 3) could bring a new upward push to the stock in the short term.

Piazzetta Cuccia also believes that the market is not attributing any probability to FiberCop’s earnouts. That is, the expected agreement for the single network with Open Fiber which could bring up to 2 billion euros to Telecom’s coffers will probably not happen given that the game is blocked on multiple political and financial fronts.