We assume Telefonica will post solid free cash flow based on our forecast for continued organic revenue growth and increasing organic operating income before depreciation and amortization (OIBDA) in 2023, alongside reducing capital expenditure (capex) intensity. Although we forecast that Telefonica's S&P Global Ratings-adjusted debt to EBITDA will run close to our downgrade trigger of 4.0x, our forecast that adjusted leverage should reach 3.8x by 2024 suggests a slight improvement, while the group's free operating cash flow to debt should remain comfortably above 8% and within the thresholds for the current rating. We therefore affirmed our 'BBB-/A-3' ratings on Telefonica. The stable outlook indicates our view that Telefonica's well-established positions and well-invested networks will support consistently robust free operating cash
