Telenor Upgraded by Barclays as Key Market Pressures in Norway and Finland Ease

Barclays on Monday upgraded its rating on Norwegian telecom operator Telenor to 'equal weight' from 'underweight,' signaling a belief that significant market headwinds have now largely abated. The bank simultaneously trimmed its price target on the stock to 135 Norwegian crowns from 140 crowns.

The Rationale Behind the Upgrade

The upgrade follows Telenor's second-quarter results, which led Barclays analysts to conclude that previously flagged negative catalysts have "largely played out." These concerns centered on rising competition in Finland and temporary operational headwinds in Telenor's home market of Norway. With the stock trading near the revised target price, the bank said it saw limited further downside potential.

Q2 Performance and Outlook

Telenor's second-quarter report revealed persistent challenges that missed consensus estimates. Key figures from the report include:

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• Clean EBITDA: Fell 4.8% year-on-year on an organic basis to 7.987 billion crowns.
• Service Revenues: Declined 0.7% organically to 14.679 billion crowns.

In response to these trends, Telenor lowered its 2026 outlook, citing weaker-than-expected revenue growth due to promotional activity in Norway and a slow recovery in mobile average revenue per user (ARPU) in Finland. The company expects cost-saving initiatives to become more impactful starting in the fourth quarter.

Nordic Market Context

Barclays noted that weakness in Finland was a common theme across all Nordic operators in the second quarter, while Sweden remained the region's strongest market due to what it called "rational competition." Despite the Telenor upgrade, Barclays kept Sweden's Tele2 as its top regional pick with an 'overweight' rating. Competitors Elisa and Telia were both maintained at 'equal weight.'