Orange's shares surged 47.5% in 2025, driven by a market‑wide rally and solid earnings. Analysts point to several upcoming catalysts, especially the investor‑focused day on February 19.
In stock‑market jargon, Orange is a classic “low‑beta” name, meaning its price tends to move less than the broader index. For example, when the CAC 40 fell 9.5% in 2022, Orange slipped only 1.4%. The pattern continued in the following years, reinforcing its reputation as a defensive telecom play.
2025 broke that calm. The stock rallied the fifth‑strongest gain in the CAC 40, delivering a 47.5% jump that caught many investors off‑guard. The rally came early in the year, as traders sought a safe haven amidst U.S. tariff worries – Orange’s domestic focus and limited exposure to customs duties made it an attractive shelter.
Why the telecom sector is gaining traction in France
Earlier pessimistic forecasts—such as Morgan Stanley’s warning about a dip in Orange’s French EBITDA—have been overturned. In the September nine‑month results, the company confirmed a higher EBITDA outlook for 2025 versus 2024, indicating a solid operational rebound.
Another driver is the ongoing consolidation debate in the French telecom market. Speculation that SFR could be absorbed by the remaining operators materialised when Orange, Bouygues and Iliad (Free) submitted a joint offer for Altice France’s assets. Although Altice initially rejected the bid, the three players have re‑opened talks, suggesting a possible three‑operator landscape.
Potential synergies from an SFR acquisition
Barclays estimates the deal could unlock €4.5‑€12.3 billion in net‑present‑value synergies, mainly through lower operating costs and a more disciplined pricing strategy. Bank of America highlights that the real value lies in easing price competition, which could protect margins for all parties.
Analysts remain cautiously optimistic. Citi upgraded Orange to “Buy” on January 5, citing a low‑risk investment thesis backed by a strong balance sheet and several catalysts. UBS also sees the SFR consolidation as a way to remedy Orange’s historically slow growth in France.
Challenges surrounding the SFR deal
SFR’s financial health presents a hurdle. The carrier carries a net debt of €16 billion, translating to a debt‑to‑EBITDA ratio of over 5, with the next major maturities due in 2028. Regulatory and political concerns—especially ahead of the 2027 French presidential election—could also stall the transaction.
What’s on the agenda for the February 19 investor day?
Orange will present its full‑year results and outline its 2028 outlook during the first capital‑market day in three years. Citi plans to focus on dividend policy, share buy‑backs, the performance of Orange Business Services, AI initiatives, and growth prospects in cybersecurity and the Africa‑Middle‑East region.
Analysts from Oddo BHF and other houses note that the company’s African and Middle‑Eastern operations, combined with a tightening cost base, could drive a 6% annual increase in free cash flow over the next three years.
Spanish expansion as a secondary growth engine
Orange aims to acquire the remaining 50% of MasOrange by mid‑2026, turning the Spanish subsidiary into a fully owned asset. UBS believes that this move could triple Orange’s free cash flow contribution from Spain between 2025 and 2028, thanks to significant cost synergies and the ability to refinance existing debt at better rates.
The Spanish market also offers a potential partnership opportunity for Telefónica, which could reshape pricing dynamics and benefit all telecom players.
Overall, Orange is positioning itself as the preferred telecom stock for investors seeking a blend of defensive stability and upside from strategic consolidation and geographic diversification.