Equity Preferences

Latest edition · September 1, 2026

UBS Equity Preference List European Communication Services 2026 09 01 2

UBS maintains a quality- and dividend-focused stance on European Communication Services, expecting free cash flow and dividend growth to accelerate as fiber capex subsides. Top picks include Deutsche Telekom, Telenor, and Universal Music Group, alongside selective European classifieds.

UBS Chief Investment Office highlights a favorable setup for European Communication Services, emphasizing companies with high-quality market exposure and strong free cash flow generation. As major fiber rollouts conclude in several European countries, lower capital expenditures should drive cash generation and support dividend yields, with consensus expecting 14% EPS growth for the sector in 2026. Within telecoms, UBS favors rational, high-quality markets such as the US, Germany, and the Nordics via Deutsche Telekom, Telenor, Elisa, Sunrise, and Inwit. In media and internet services, UBS identifies attractive medium-term opportunities in Universal Music Group, Spotify, and online classifieds leaders Scout24 and SMG Swiss Marketplace Group, where market concerns over streaming leverage and generative AI disintermediation are considered overblown.

Key takeaways from the latest edition

• 1.European telecom valuations are fair and free cash flow is poised to improve as fiber capital expenditures decline following rollout completions across Spain, Italy, Norway, and the UK.
• 2.Focus is concentrated in structurally high-quality telco regions like the US, Germany, and the Nordics where pricing is rational and market shares are defensive.
• 3.Generative AI disintermediation fears in classifieds (Scout24, SMG) and streaming platform tension with music rights holders (Universal Music Group) present attractive medium-term entry points.

What this series covers

• European Communication Services
• Positioning and key trends
• Latest quarterly earnings summary
• Ad-hoc changes
• Sustainability considerations
• Equity selection
• About the authors
• Appendix

Edition archive

• UBS Equity Preference List European Communication Services 2026 09 01 2

  September 1, 2026

• UBS Equity Preference List China A share 2026 08 28

  August 28, 2026

• UBS Equity Preference List China Onshore Tech 2026 08 28

  August 28, 2026

• UBS Equity Preference List Hong Kong 2026 08 27

  August 27, 2026

• UBS Equity Preference List Beyond AI The Power of Humanoids and Automation 2026 08 26

  August 26, 2026

• UBS Equity Preference List Beyond AI The Power of Humanoids and Automation 2026 08 17

  August 17, 2026