Assessing Millicom (NasdaqGS:TIGO): Is the Stock Overvalued After Its Recent 31% Rally?

Millicom International Cellular (NasdaqGS:TIGO) continues to catch investor attention, recently showing a return of nearly 31% over the past 3 months. The stock’s gains have coincided with positive sentiment about its financial performance and growth prospects.

See our latest analysis for Millicom International Cellular.

Millicom’s momentum is building, with a standout 31% gain in the last 90 days underscoring renewed investor confidence. Over the past year, the company delivered a total shareholder return just shy of 100%, signaling substantial long-term growth potential beyond recent price moves.

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But with such rapid gains, investors face a crucial question: is Millicom still undervalued based on its fundamentals, or has the market already priced in every bit of future growth potential as the stock climbs higher?

Most Popular Narrative: 4% Overvalued

The most widely followed narrative sees Millicom International Cellular’s fair value at $46.51, slightly below the latest close of $48.47. This comparison paints a picture of a company recognition cycle where market optimism and changed expectations may be balancing out previous underappreciation.

Bearish analysts highlight that Millicom continues to exhibit the softest growth outlook compared to its Latin American peers. This casts some doubt on future earnings momentum.

Read the complete narrative.

Want to know what assumptions analysts think will drive or limit Millicom’s share price? The core of this narrative lies in steady revenues, tougher margins and a future profit multiple that may surprise even its most ardent fans. Uncover which performance trends and forecasts shape this price view.

Result: Fair Value of $46.51 (OVERVALUED)

Have a read of the narrative in full and understand what's behind the forecasts.

However, a surge in organic growth or a successful margin improvement strategy could quickly challenge these cautious outlooks and spark renewed optimism around Millicom.

Find out about the key risks to this Millicom International Cellular narrative.

Another View: The SWS DCF Model Says Undervalued

While many focus on peer and industry multiples, our DCF model takes a longer-term look at cash flows. By this view, Millicom appears undervalued, trading at nearly 48% below what the DCF suggests is fair value. Does the market see a risk that the model does not see, or is there hidden upside ahead?

Look into how the SWS DCF model arrives at its fair value.

Build Your Own Millicom International Cellular Narrative

If you would rather dig into the numbers yourself or have a different take on Millicom’s outlook, you can shape your own analysis in just a few minutes. Do it your way.

A great starting point for your Millicom International Cellular research is our analysis highlighting 3 key rewards and 4 important warning signs that could impact your investment decision.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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