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Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in Earnings Before Interest and Taxes (EBIT).
Telefonica Deutschland Holding AG's Degree of Financial Leverage for the quarter that ended in Dec. 2025 was 1.25. The higher Degree of Financial Leverage, the more volatile earnings will be.
HAM:O2D's Degree of Financial Leverage is ranked worse than 60.56% of 355
companies
in the Telecommunication Services industry
Industry Median: 1.05
vs HAM:O2D: 1.25
Telefonica Deutschland Holding AG (HAM:O2D) Degree of Financial Leverage Explanation
Degree of Financial Leverage (DFL) is a leverage ratio that measures the sensitivity of a company’s Earnings per Share (EPS) to fluctuations in its operating income, also referred to as Earnings Before Interest and Taxes (EBIT), resulting from adjustments in its capital structure. DFL is an essential tool for companies to assess the appropriate level of debt or financial leverage in their capital structure. When EBIT remains relatively stable, it results in stable earnings and earnings per share. In such cases, the company may consider taking on substantial debt. However, for companies operating in industries with significant fluctuations in EBIT, it is advisable to keep debt at a manageable level.
The higher Degree of Financial Leverage, the more volatile earnings will be. Because interest is a fixed expense, leverage can amplify earnings and EPS. This is beneficial when EBIT is growing, but it can become problematic in tough economic conditions when EBIT is under pressure.
Be Aware
The use of financial leverage varies across different industries and business sectors, and the application of Degree of Financial Leverage (DFL) should be adjusted accordingly.
Telefonica Deutschland Holding AG Degree of Financial Leverage Related Terms
Telefonica Deutschland Holding AG Degree of Financial Leverage Historical Data
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Telefonica Deutschland Holding AG Degree of Financial Leverage Chart
HAM:O2D vs TMUS, VZ, T: Degree of Financial Leverage Comparison
For the Telecom Services subindustry, Telefonica Deutschland Holding AG's Degree of Financial Leverage, along with its competitors' market caps and Degree of Financial Leverage data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Telefonica Deutschland Holding AG Degree of Financial Leverage vs Telecommunication Services Industry
For the Telecommunication Services industry and Communication Services sector, Telefonica Deutschland Holding AG's Degree of Financial Leverage distribution charts can be found below:
* The bar in red indicates where Telefonica Deutschland Holding AG's Degree of Financial Leverage falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
** TTM data of EPS and EBIT was used to calculate Degree of Financial Leverage.
*** Please be aware that the Degree of Financial Leverage calculations are based on company-level data using the primary share class. The calculated data provided is for demonstration purposes and may slightly differ from the results displayed in the title due to potential variations caused by currency exchange rate differences throughout the year.
What does a Degree of Financial Leverage of 1.25 mean?
Telefonica Deutschland Holding AG (HAM:O2D) has a Degree of Financial Leverage of 1.25 as of Dec. 2025. Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in EBIT. View historical data for Telefonica Deutschland Holding AG and its competitors. According to the industry distribution chart, Telefonica Deutschland Holding AG ranks #215 out of 355 companies in the Telecommunication Services industry, placing it in the top 60.6%.
Is Telefonica Deutschland Holding AG's Degree of Financial Leverage too high?
Telefonica Deutschland Holding AG's current Degree of Financial Leverage is 1.25. The Telecommunication Services industry median Degree of Financial Leverage is 1.05. Telefonica Deutschland Holding AG's value of 1.25 is 19% above this industry median. Based on the distribution chart, Telefonica Deutschland Holding AG ranks #215 out of 355 companies in the Telecommunication Services industry, which is below the industry midpoint. Overall, Telefonica Deutschland Holding AG has a GF Score™ of 66/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Telefonica Deutschland Holding AG's Degree of Financial Leverage compare to TMUS and VZ?
According to the Telecommunication Services industry distribution chart, Telefonica Deutschland Holding AG ranks #215 out of 355 companies for Degree of Financial Leverage. This places Telefonica Deutschland Holding AG in the lower half of its industry. The industry median Degree of Financial Leverage is 1.05. Telefonica Deutschland Holding AG's value of 1.25 is 19% above this benchmark. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Degree of Financial Leverage for a Telecommunication Services company?
The median Degree of Financial Leverage among Telecommunication Services companies is 1.05, based on 355 companies in the industry. Companies in the top quartile (top 25%) have a Degree of Financial Leverage significantly above this median, while those in the bottom quartile fall well below. However, Degree of Financial Leverage should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Telefonica Deutschland Holding AG's current Degree of Financial Leverage of 1.25 is 19% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Degree of Financial Leverage mean?
A high Degree of Financial Leverage can signal that a stock is expensive relative to its fundamentals. Degree of Financial Leverage (DFL) measures the percentage change in EPS for a unit change in EBIT. View historical data for Telefonica Deutschland Holding AG and its competitors. For the Telecommunication Services industry, the median Degree of Financial Leverage is 1.05 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. Telefonica Deutschland Holding AG's current Degree of Financial Leverage is 1.25. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Telefonica Deutschland Holding AG stock overvalued right now?
Based on GuruFocus' analysis, Telefonica Deutschland Holding AG (HAM:O2D) is currently considered Fairly Valued. The stock's GF Value™ is €2.09, compared to a current price of €1.98 — trading 5.3% below its estimated fair value. The current Degree of Financial Leverage is 1.25 and 19% above the Telecommunication Services industry median of 1.05. Telefonica Deutschland Holding AG's overall GF Score™ is 66/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Degree of Financial Leverage calculated?
Degree of Financial Leverage is calculated from a company's financial statements. For Telefonica Deutschland Holding AG (HAM:O2D), the current Degree of Financial Leverage is 1.25 as of Dec. 2025. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Telefonica Deutschland Holding AG (HAM:O2D) Overvalued in 2026?
Based on GuruFocus' analysis, Telefonica Deutschland Holding AG stock appears to be undervalued.
The current stock price of €1.98 is trading 5.3% below its estimated GF Value™ of €2.09.
GuruFocus considers Telefonica Deutschland Holding AG to be Fairly Valued.
Key valuation signals for HAM:O2D:
Degree of Financial Leverage: 1.25
GF Value™: €2.09 vs. price of €1.98 (5.3% below fair value)
Industry Position: 19% above the Telecommunication Services median (#215 of 355)
No single metric tells the full story. See the HAM:O2D stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Telefonica Deutschland Holding AG Business Description
Telefonica Deutschland Holding AG is the German subsidiary of Telefonica, which provides integrated network operations in Germany. The company offers mobile and fixed-network services for private and business customers as well as digital products and services. Its core brand is O2. It includes secondary brands and partners such as ALDI TALK, Tchibo MOBIL, AY YILDIZ, and others.
66GF Score
Get the complete analysis for HAM:O2D
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