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TMUS

T-Mobile US NasdaqGS:TMUS Stock Report

Last Price

US$146.46

Market Cap

US$183.7b

7D

1.3%

1Y

1.0%

Updated

12 Aug, 2022

Data

Company Financials +
TMUS fundamental analysis
Snowflake Score
Valuation2/6
Future Growth3/6
Past Performance0/6
Financial Health3/6
Dividends0/6

TMUS Stock Overview

T-Mobile US, Inc., together with its subsidiaries, provides mobile communications services in the United States, Puerto Rico, and the United States Virgin Islands.

T-Mobile US Competitors

Price History & Performance

Summary of all time highs, changes and price drops for T-Mobile US
Historical stock prices
Current Share PriceUS$146.46
52 Week HighUS$147.68
52 Week LowUS$101.51
Beta0.48
1 Month Change8.55%
3 Month Change15.93%
1 Year Change1.05%
3 Year Change88.37%
5 Year Change132.48%
Change since IPO786.56%

Recent News & Updates

Aug 10

Samsung Galaxy Z Fold4, Z Flip4 smartphones come to T-Mobile

T-Mobile (NASDAQ:TMUS) has added Samsung's (OTCPK:SSNLF) new Galaxy Z Fold4 and Z Flip4 smartphones for new and existing customers, including small businesses. The new Samsung Galaxy Watch5 series - which includes the Galaxy Watch5 and Galaxy Watch5 Pro - and a new color of the Samsung Galaxy S22 smartphone have also come to T-Mobile. The devices are now available for pre-order and can be found at T-Mobile stores from August 26. CEO Mike Sievert said: "Customers can get up to $1000 off the new Samsung devices [...] paired with our most popular plan, Magenta MAX, and families get more than $225 a month in extra benefits including Netflix On Us, free in-flight Wi-Fi, free international high-speed data and more."

Jul 28

Why T-Mobile Is A Buy After Q2 Earnings

T-Mobile missed earnings estimates but gave impressive forward guidance. The company raised guidance across the board. Management forecasts over 6 million postpaid net customer additions and over 10% core adjusted EBITDA growth. The company is ahead in the 5G market. It is leveraging its advantages to enter the high speed internet service business. I think the shares are cheap, trading at just over 10 times EV/core adjusted EBITDA. Investment Thesis T-Mobile (TMUS) is the leading pure play mobile internet company. The business has shown strong core EBITDA growth. We're seeing a decline in expenses related to their merger with Sprint. I believe T-Mobile is set to return strong free cash flow to shareholders. In the long term, I think T-Mobile is a great way to invest in the shift to 5G. The company is also leading a broad transformation away from legacy internet companies. This, combined with their relatively cheap valuation, makes me bullish on the company. Strong guidance and growth plans T-Mobile's most recent quarterly results were very strong. The company added a record number of customers to its postpaid plans. Management raised guidance across the board, boosting both their revenue and profitability outlook. It was a strong quarter for T-Mobile's subscriber services. The business added a net of 1.7 million postpaid customers, including 723 thousand wireless phones. The company then raised its subscriber growth guidance by over 10%. 2022 postpaid customer growth is now projected to be 6 to 6.3 million subscribers. On their earnings call, management pointed out that T-Mobile added more quarterly postpaid customers than AT&T (T) and Verizon (VZ) combined. T-Mobile Postpaid Account Growth (T-Mobile Q2 2022 Investor Factbook) T-Mobile's postpaid service revenues grew by 9% year over year. Core adjusted EBITDA was up 10% year over year. These results demonstrate that T-Mobile is generating solid growth. This is especially impressive in an industry with a slower total growth rate. I like T-Mobile's position as a pure play mobile internet company. This strategy allows leadership to effectively focus on adding customers across market segments. T-Mobile is positioned as the leader in the 5G space. According to market data collected by Ookla, T-Mobile has the highest 5G availability. Their 5G speeds are also faster than both AT&T and Verizon. Management has consistently described T-Mobile's service as two years ahead of its competitors. T-Mobile 5G Geographic Coverage (T-Mobile Q2 2022 Investor Factbook) But by itself, T-Mobile's earnings release wasn't great. Revenue slightly missed expectations, and EPS showed a net loss of $0.09. The company attributed $1.00 per share of this loss to merger related costs. There was also a $0.29 per share impairment of Sprint's wireline assets and a $0.23 per share expense related to a cyberattack settlement. Fortunately, most of these special charges won't have long term effects on the company. Increasing incremental revenue I find T-Mobile's incremental revenue growth compelling. The company is driving solid per user revenue increases without direct price hikes. The company's postpaid average revenue per account increased 3.3% year over year. Their postpaid average revenue per user increased by 2.8% year over year. Postpaid ARPA is expected to increase 3% for the full year. T-Mobile has committed to keeping prices steady for the time being. Most of this growth is from extra purchases of premium or value add services. T-Mobile Postpaid ARPA and ARPU Growth (T-Mobile Q2 2022 Investor Factbook) I think there are some risks to this strategy. As inflation increases, it may make it difficult for T-Mobile to keep up top line growth. The company is trying to capitalize on its lower cost, fixed rate pricing to generate new business. This may make it difficult to grow if industry churn decreases. But I don't see much evidence of this happening right now. So far, these headwinds seem manageable. New markets in broadband internet In addition to strong results in its core business, T-Mobile's newer products are performing very well. The company's high speed internet service posted especially strong results. The company's internet services are an important component of T-Mobile's growth strategy. They add a separate service outside of the company's mobile phone offerings. It's an opportunity to generate extra incremental revenue from existing customers in exchange for a useful service. This creates the potential for T-Mobile to grow much faster than the industry. It's also an opportunity to compete with traditional internet providers. Legacy internet companies typically have low customer satisfaction and the space is open for disruption. T-Mobile High Speed Internet Customer Growth (T-Mobile Q2 2022 Investor Factbook) T-Mobile added 560 thousand new customers to their internet service during the quarter. The company now has 1.54 million customers, a 436% year over year increase. It's the company's third consecutive quarter leading the industry in net adds. I think this is a great opportunity and T-Mobile is making the most of it. The final stages of the merger T-Mobile continues to make solid progress integrating Sprint's assets into their business. The company now expects Sprint's network to be fully shut down by the end of next quarter. Management even raised their merger synergies guidance by $200 million. Ongoing merger costs have been the primary headwind for T-Mobile's earnings. But these expenditures are in their final stages. Almost all of Sprint's customers are on T-Mobile's network. Management discussed the last steps on their latest earnings call. And speaking of network, we just hit some major integration milestones. Just over two years since we closed the merger, we have successfully shutdown most of the Sprint network. As of the end of the quarter, we had cumulatively decommissioned nearly two-thirds of the 35,000 targeted sites and can now report that we will be substantially complete by the end of Q3 this current quarter, remarkable work by the team to deliver these milestones ahead even of our recent year-end target and more than one year earlier than our original merger plan... Merger-related costs, which are not included in core adjusted EBITDA and are expected to be between $4.7 billion and $5.0 billion before taxes, primarily representing network activities. With Q2 being the peak quarter, we expect that Q3 will be closer to Q1 levels, and then taper off in Q4.

Shareholder Returns

TMUSUS Wireless TelecomUS Market
7D1.3%0.2%1.3%
1Y1.0%-4.3%-11.7%

Return vs Industry: TMUS exceeded the US Wireless Telecom industry which returned -4.3% over the past year.

Return vs Market: TMUS exceeded the US Market which returned -11.7% over the past year.

Price Volatility

Is TMUS's price volatile compared to industry and market?
TMUS volatility
TMUS Average Weekly Movement3.6%
Wireless Telecom Industry Average Movement6.9%
Market Average Movement7.8%
10% most volatile stocks in US Market16.9%
10% least volatile stocks in US Market3.2%

Stable Share Price: TMUS is less volatile than 75% of US stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: TMUS's weekly volatility (4%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
199475,000Mike Sieverthttps://www.t-mobile.com

T-Mobile US, Inc., together with its subsidiaries, provides mobile communications services in the United States, Puerto Rico, and the United States Virgin Islands. The company offers voice, messaging, and data services to 108.7 million customers in the postpaid, prepaid, and wholesale markets. It also provides wireless devices, including smartphones, wearables, and tablets and other mobile communication devices, as well as wireless devices and accessories.

T-Mobile US Fundamentals Summary

How do T-Mobile US's earnings and revenue compare to its market cap?
TMUS fundamental statistics
Market CapUS$183.67b
Earnings (TTM)US$1.72b
Revenue (TTM)US$80.23b

106.9x

P/E Ratio

2.3x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
TMUS income statement (TTM)
RevenueUS$80.23b
Cost of RevenueUS$33.68b
Gross ProfitUS$46.55b
Other ExpensesUS$44.83b
EarningsUS$1.72b

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)1.37
Gross Margin58.02%
Net Profit Margin2.14%
Debt/Equity Ratio101.4%

How did TMUS perform over the long term?

See historical performance and comparison
We’ve recently updated our valuation analysis.

Valuation

Is TMUS undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

  • Price-To-Earnings vs Peers

  • Price-To-Earnings vs Industry

  • Price-To-Earnings vs Fair Ratio

  • Below Fair Value

  • Significantly Below Fair Value

  • Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for TMUS?

Other financial metrics that can be useful for relative valuation.

TMUS key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue3.6x
Enterprise Value/EBITDA11.3x
PEG Ratio2.9x

Price to Earnings Ratio vs Peers

How does TMUS's PE Ratio compare to its peers?

TMUS PE Ratio vs Peers
The above table shows the PE ratio for TMUS vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
CompanyPEEstimated GrowthMarket Cap
Peer Average13x
TIGO Millicom International Cellular
3.9x16.8%US$2.7b
USM United States Cellular
19.7x-12.1%US$2.6b
VZ Verizon Communications
9.1x4.8%US$189.6b
TDS Telephone and Data Systems
19.2x-3.8%US$1.9b
TMUS T-Mobile US
106.9x37.2%US$183.7b

Price-To-Earnings vs Peers: TMUS is expensive based on its Price-To-Earnings Ratio (106.9x) compared to the peer average (13x).


Price to Earnings Ratio vs Industry

How does TMUS's PE Ratio compare vs other companies in the Global Wireless Telecom Industry?

Price-To-Earnings vs Industry: TMUS is expensive based on its Price-To-Earnings Ratio (106.9x) compared to the US Wireless Telecom industry average (19.6x)


Price to Earnings Ratio vs Fair Ratio

What is TMUS's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

TMUS PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio106.9x
Fair PE Ratio19.8x

Price-To-Earnings vs Fair Ratio: TMUS is expensive based on its Price-To-Earnings Ratio (106.9x) compared to the estimated Fair Price-To-Earnings Ratio (19.8x).


Share Price vs Fair Value

What is the Fair Price of TMUS when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: TMUS ($146.46) is trading below our estimate of fair value ($503.2)

Significantly Below Fair Value: TMUS is trading below fair value by more than 20%.


Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.


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Future Growth

How is T-Mobile US forecast to perform in the next 1 to 3 years based on estimates from 28 analysts?

Future Growth Score

3/6

Future Growth Score 3/6

  • Earnings vs Savings Rate

  • Earnings vs Market

  • High Growth Earnings

  • Revenue vs Market

  • High Growth Revenue

  • Future ROE


37.2%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: TMUS's forecast earnings growth (37.2% per year) is above the savings rate (1.9%).

Earnings vs Market: TMUS's earnings (37.2% per year) are forecast to grow faster than the US market (14.4% per year).

High Growth Earnings: TMUS's earnings are expected to grow significantly over the next 3 years.

Revenue vs Market: TMUS's revenue (4.1% per year) is forecast to grow slower than the US market (7.9% per year).

High Growth Revenue: TMUS's revenue (4.1% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

Future ROE: TMUS's Return on Equity is forecast to be low in 3 years time (16.3%).


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Past Performance

How has T-Mobile US performed over the past 5 years?

Past Performance Score

0/6

Past Performance Score 0/6

  • Quality Earnings

  • Growing Profit Margin

  • Earnings Trend

  • Accelerating Growth

  • Earnings vs Industry

  • High ROE


-5.7%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: TMUS has a large one-off loss of $5.6B impacting its June 30 2022 financial results.

Growing Profit Margin: TMUS's current net profit margins (2.1%) are lower than last year (4.9%).


Past Earnings Growth Analysis

Earnings Trend: TMUS's earnings have declined by 5.7% per year over the past 5 years.

Accelerating Growth: TMUS's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: TMUS had negative earnings growth (-56.1%) over the past year, making it difficult to compare to the Wireless Telecom industry average (-29.2%).


Return on Equity

High ROE: TMUS's Return on Equity (2.5%) is considered low.


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Financial Health

How is T-Mobile US's financial position?

Financial Health Score

3/6

Financial Health Score 3/6

  • Short Term Liabilities

  • Long Term Liabilities

  • Debt Level

  • Reducing Debt

  • Debt Coverage

  • Interest Coverage

Financial Position Analysis

Short Term Liabilities: TMUS's short term assets ($17.5B) do not cover its short term liabilities ($20.6B).

Long Term Liabilities: TMUS's short term assets ($17.5B) do not cover its long term liabilities ($118.8B).


Debt to Equity History and Analysis

Debt Level: TMUS's net debt to equity ratio (96.9%) is considered high.

Reducing Debt: TMUS's debt to equity ratio has reduced from 142.8% to 101.4% over the past 5 years.

Debt Coverage: TMUS's debt is well covered by operating cash flow (20.5%).

Interest Coverage: TMUS's interest payments on its debt are well covered by EBIT (3.2x coverage).


Balance Sheet


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Dividend

What is T-Mobile US current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

  • Notable Dividend

  • High Dividend

  • Stable Dividend

  • Growing Dividend

  • Earnings Coverage

  • Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate TMUS's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate TMUS's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.


Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if TMUS's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if TMUS's dividend payments have been increasing.


Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.


Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as TMUS has not reported any payouts.


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Management

How experienced are the management team and are they aligned to shareholders interests?

2.1yrs

Average management tenure


CEO

Mike Sievert (52 yo)

4.17yrs

Tenure

US$22,610,659

Compensation

Mr. G. Michael Sievert, also known as Mike, is Chief Executive Officer and President at T-Mobile USA, Inc and has been its Director since 2018. He has served as the Chief Executive Officer of T-Mobile US,...


CEO Compensation Analysis

Compensation vs Market: Mike's total compensation ($USD22.61M) is above average for companies of similar size in the US market ($USD12.88M).

Compensation vs Earnings: Mike's compensation has been consistent with company performance over the past year.


Leadership Team

Experienced Management: TMUS's management team is considered experienced (2.1 years average tenure).


Board Members

Experienced Board: TMUS's board of directors are considered experienced (6.9 years average tenure).


Ownership

Who are the major shareholders and have insiders been buying or selling?


Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.


Top Shareholders

Company Information

T-Mobile US, Inc.'s employee growth, exchange listings and data sources


Key Information

  • Name: T-Mobile US, Inc.
  • Ticker: TMUS
  • Exchange: NasdaqGS
  • Founded: 1994
  • Industry: Wireless Telecommunication Services
  • Sector: Telecom
  • Implied Market Cap: US$183.667b
  • Shares outstanding: 1.25b
  • Website: https://www.t-mobile.com

Number of Employees


Location

  • T-Mobile US, Inc.
  • 12920 SE 38th Street
  • Bellevue
  • Washington
  • 98006-1350
  • United States

Listings


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2022/08/12 00:00
End of Day Share Price2022/08/12 00:00
Earnings2022/06/30
Annual Earnings2021/12/31


Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.