1&1 (1U1 GR) Germany
Report by New Street Research
1&1 and United Internet both had a poor 2022 as concerns and lack of visibility on the network build continue to grow. New Street believes the situation is misunderstood - as either 1&1 goes ahead with the network build which should generate long-term EBITDA growth and mirror what Iliad has been doing in Italy (their base case), or it walks away and reverts to being an MVNO which would also generate substantial upside. An IONOS IPO could also be a further support for United Internet. An expected CMD in March could finally be a catalyst to bring this to a head. If the market continues to disbelieve after that, the case for a minority buy-in becomes even more compelling. TP €31 (150% upside).