LILA: Sustained 7% EBITDA Performance Will Drive Continued Share Rebound

Analysts have raised their price target on Liberty Latin America to $13 from $12, citing confidence that the company's recent 7 percent Q3 rebased EBITDA growth reflects sustainably improving performance.

Analyst Commentary

Analyst feedback on the updated price target highlights both growing confidence in Liberty Latin America's operational trajectory and several areas that still warrant caution from an execution and valuation standpoint.

Bullish Takeaways

• Bullish analysts point to the 7 percent Q3 rebased EBITDA growth as evidence that recent improvements are not one-off. This is seen as supporting a higher valuation multiple on more predictable cash flows.
• The upward revision in the price target is framed as a recognition that the stock's rebound potential remains significant, as management continues to deliver on cost discipline and margin expansion.
• Stronger underlying profitability trends are seen as enhancing the company's financial flexibility, which could accelerate strategic investments and inorganic growth opportunities in core markets.
• Improved earnings visibility is viewed as reducing downside risk, with analysts suggesting the risk reward skew is shifting favorably as execution metrics steadily meet or exceed prior expectations.

Bearish Takeaways

• Bearish analysts caution that despite the better than expected performance, the upgraded price target still embeds assumptions of sustained high single digit EBITDA growth that may be vulnerable to macro or competitive pressures in Latin American markets.
• Some remain concerned that the rebound thesis is heavily dependent on continued operational execution, leaving limited margin for error if integration initiatives or network investments lag.
• There is also wariness that a stronger growth profile could attract intensified competitive responses, which may cap pricing power and limit upside to revenue expansion over the medium term.
• Valuation skeptics argue that while the stock appears more reasonably priced relative to its improved fundamentals, a full rerating will require multiple additional quarters of consistent delivery to build broader investor conviction.

What's in the News

• Completed a major share repurchase under the May 8, 2023 buyback program, buying back 20,045,325 shares, or 9.74 percent of outstanding shares, for a total of $147.66 million, including 280,000 shares repurchased in Q3 2025 for $2.31 million (company buyback update).
• Maintained flexibility under a newer buyback program announced on May 7, 2024. No shares were repurchased in the July 1 to September 30, 2025 period, signaling disciplined capital deployment despite authorization (company buyback update).
• Partnered with Starlink Direct to Cell to restore critical mobile connectivity in Jamaica after Hurricane Melissa, enabling FLOW Jamaica customers to access data, SMS, and app based messaging via Starlink's satellite network when terrestrial infrastructure is down, in what is described as the first collaboration of its kind in the Caribbean (company client announcement).

Valuation Changes

• Fair Value: Unchanged at approximately $11.97 per share, indicating no adjustment to the intrinsic value estimate despite operational updates.
• Discount Rate: Held steady at 12.5 percent, reflecting an unchanged view of the company’s risk profile and required return.
• Revenue Growth: Lowered from about 2.6 percent to roughly 1.8 percent, signaling a modestly more conservative outlook on top line expansion.
• Net Profit Margin: Increased slightly from around 7.08 percent to about 7.25 percent, incorporating expectations for incremental profitability improvements.
• Future P/E: Stable at roughly 10.6x, suggesting the valuation multiple applied to forward earnings remains consistent with prior assumptions.