Investing in the IBEX 35 — Telefónica

Countries where Telefónica is present
  • The firm’s D/E ratio is of 2.74 and has stood above 2 the entire last decade. Whilst a certain amount of leverage might be beneficial for tax purposes and to not dilute existing shareholders, keeping this number under 2 would be the best option for Telefónica to not feel the brunt of its debt pile.
  • Similarly, its current ratio, or ability to pay short-term obligations, has improved from 0.63 to 0.81 from 2010 to 2019 respectively. Nonetheless, having it above 1 would put the company in a more favourable position.
  • On the bright side, Telefonica’s average CapEx as a % of sales in the last decade has been of 16.8%. This figure stood at a solid 15.8% in 2019.

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