Morgan Stanley’s assessment of Poste Italiane’s growth prospects puts the TIM acquisition at the center of its investment case. On October 13, 2026, the bank resumed coverage with an Overweight rating and a €29 price target, forecasting stronger earnings and dividends after an integration-driven dip in 2027.
Key takeaways
- Poste Italiane holds 86.95% of TIM following the takeover.
- The synergy plan targets €700 million in yearly pre-tax benefits.
- Morgan Stanley projects a €1.84 dividend per share in 2029.
According to Milano Finanza, Morgan Stanley sees TIM as the next source of growth for the group, with benefits beyond those already reflected in market expectations. Poste Italiane now owns 86.95% of TIM following the takeover.
Yahoo Finanza separately reported a 1.2% rise in Poste Italiane shares alongside Morgan Stanley’s €29 target following the Telecom Italia acquisition.
TIM synergies underpin Poste Italiane’s growth prospects
The acquisition plan targets €700 million in annual pre-tax benefits, comprising €500 million in cost savings and more than €200 million in higher revenues. The identified cost measures span IT, procurement, customer service and personnel reorganization.
The savings represent about 2.5% of the combined cost base. They also include €50–€100 million in lower debt costs: Poste has an investment-grade rating, TIM does not, and Morgan Stanley expects the combined group to retain Poste’s rating.
On revenues, the bank projects roughly €1.8 billion in additional sales between 2027 and 2029, equivalent to about 6.6% of combined revenues.
Earnings dip in 2027 before the projected uplift
Morgan Stanley estimates that integration costs and new initiatives will reduce earnings per share to €1.69 in 2027. Its forecast then puts 2028 EPS at €2.33, compared with €2.16 for Poste alone.
The bank estimates an acquisition-related EPS uplift of 8% in 2028 and 10% in 2029. Its forecasts stand around 8–9% above consensus, which Morgan Stanley says still does not fully consolidate TIM.
The dividend outlook also rises: estimated payments increase from €1.31 per share in 2026 to €1.84 in 2029. The projected dividend yield for 2028 is around 7% at the share prices used in the report.
More cash for investment and debt reduction
Morgan Stanley forecasts that the combined group will retain €1.1 billion in cash after dividend payments in 2028 and €1.2 billion in 2029. That compares with roughly €0.3–€0.4 billion for Poste on a standalone basis.
The report identifies investment, debt reduction and higher dividends as uses for that liquidity. With debt falling, leverage is expected to decline from 1.4 times EBITDA to 0.8 times by 2029.
Bond yields support BancoPosta’s interest margin
Higher Italian government bond yields support BancoPosta’s net interest margin as it reinvests its portfolio at higher yields. The benefit arrives with a lag because 58% of the portfolio carries fixed rates.
Poste Vita’s half-year figures show a solvency decline of about 37 points from a starting level above 300%.
Factors outside Morgan Stanley’s estimates
Morgan Stanley’s forecasts for Poste Italiane’s growth prospects exclude the Financial Hub, which combines banking, payments and insurance, and possible Italian telecoms consolidation. They also leave out TIM’s €1 billion in deferred tax assets and AI-related benefits.
The report places mobile average revenue per user at around €10 a month, compared with €24 in three-operator markets. It estimates that each additional euro would contribute about 3% to EPS.
Article produced with the assistance of artificial intelligence and reviewed by the editorial team.