Goldman Sachs Lowers 1&1 Price Target Amid Restructuring Challenges

Goldman Sachs has lowered its price target for 1&1 AG from EUR 26.20 to EUR 25.60 while maintaining a Buy rating. The adjustment came after 1&1 revised its 2026 operating-profit outlook, cutting it from EUR 800 million to EUR 740 million due to restructuring efforts at its business-customer infrastructure unit, Versatel. The company launched a program aimed at simplifying organizations, processes, and structures, but investors remain concerned about the gap between the identified EUR 60 million operating impact and the unchanged adjusted operating-profit ambition of EUR 800 million.

Despite revenue growth of 13.75% in the second quarter of 2026, reaching EUR 1.12 billion compared to EUR 987.92 million in the prior-year quarter, earnings per share declined significantly. EPS fell from EUR 0.15 to EUR 0.07, a 53.33% year-over-year decrease. This contrast between revenue expansion and earnings weakness makes the EUR 25.60 target more dependent on the successful execution of the cost program and a return to the company's operating-profit plan.

As of October 5, 2026, 1&1 stock was trading at EUR 24.10, unchanged from the prior close. The stock is EUR 3.20 below its 52-week high of EUR 27.30 and EUR 5.48 above its 52-week low of EUR 18.62. The market capitalization stood at EUR 4.3 billion, with investors closely watching whether the restructuring can bridge the gap between revenue growth and profitability. Berenberg's higher target of EUR 30.00, dated October 1, 2026, provides an additional reference point.

1&1's next quarterly report is expected on November 12, 2026. The company, listed under ISIN DE0005545503 and ticker 1U1, continues to operate in the Communication Services sector and is a member of the SDAX index.