Swisscom Earnings: EBITDA Declines Due to Competitive Pressures; Maintain Fair Value Estimate

Narrow-moat Swisscom’s revenue decreased by 1.6% in the first quarter to CHF 2.703 billion, with EBITDA decreasing by 0.8% to CHF 1.155 billion, although the decrease would have been greater, close to 1.5%, after excluding nonrecurring items and at constant exchange rates. Management reaffirmed its 2024 guidance of CHF 11.0 billion revenue and CHF 4.5 billion to CHF 4.6 billion in EBITDA. We are maintaining our CHF 440 per share fair value estimate, with shares being overvalued, trading in the CHF 500 range. The board intends to distribute a CHF 22 dividend per share, which has been stable now for 13 years thanks to the stability of the Swiss market.