T-Mobile US, Inc. (NASDAQ:TMUS) Receives Consensus Recommendation of "Moderate Buy" from Analysts

Key Points

• T-Mobile US has a consensus analyst rating of “Moderate Buy”, with 22 buy ratings, 7 hold ratings, and 1 strong buy rating across 30 analysts. The average 1-year price target is $254.56.
• The company beat second-quarter earnings expectations, reporting EPS of $2.99 versus the $2.59 estimate, while revenue of $22.79 billion came in slightly below forecasts. T-Mobile also raised its annual free cash flow forecast and continued to show strong service-revenue and postpaid customer growth.
• Despite solid fundamentals, the stock has faced pressure as investors focus on the revenue miss and signs of slower subscriber growth. Shares opened at $170.42, well below the stock’s recent analyst price targets and its 52-week high of $261.56.

T-Mobile US, Inc. (NASDAQ:TMUS - Get Free Report) has earned a consensus recommendation of "Moderate Buy" from the thirty analysts that are currently covering the firm, Marketbeat.com reports. Seven analysts have rated the stock with a hold recommendation, twenty-two have issued a buy recommendation and one has issued a strong buy recommendation on the company. The average 1 year target price among brokers that have issued ratings on the stock in the last year is $254.56.

A number of brokerages have recently weighed in on TMUS. JPMorgan Chase & Co. restated a "buy" rating on shares of T-Mobile US in a research report on Tuesday, May 19th. Scotiabank decreased their price objective on shares of T-Mobile US from $263.00 to $243.00 and set a "sector outperform" rating on the stock in a research report on Wednesday, July 15th. Morgan Stanley lowered their price objective on shares of T-Mobile US from $260.00 to $230.00 and set an "overweight" rating on the stock in a research note on Tuesday, July 7th. Freedom Capital upgraded shares of T-Mobile US from a "hold" rating to a "strong-buy" rating in a report on Friday, April 17th. Finally, The Goldman Sachs Group restated a "buy" rating on shares of T-Mobile US in a research report on Wednesday, April 29th.

T-Mobile US Stock Performance

NASDAQ TMUS opened at $170.42 on Friday. The business has a 50 day moving average price of $184.63 and a 200 day moving average price of $195.77. The company has a market capitalization of $184.43 billion, a P/E ratio of 18.13, a PEG ratio of 1.13 and a beta of 0.33. T-Mobile US has a 1-year low of $165.66 and a 1-year high of $261.56. The company has a debt-to-equity ratio of 1.58, a current ratio of 1.09 and a quick ratio of 0.97.

T-Mobile US (NASDAQ:TMUS - Get Free Report) last posted its earnings results on Thursday, July 23rd. The Wireless communications provider reported $2.99 EPS for the quarter, topping analysts' consensus estimates of $2.59 by $0.40. The company had revenue of $22.79 billion for the quarter, compared to the consensus estimate of $22.95 billion. T-Mobile US had a return on equity of 19.47% and a net margin of 11.65%.T-Mobile US's quarterly revenue was up 7.9% compared to the same quarter last year. During the same period in the previous year, the business earned $2.84 earnings per share. Sell-side analysts expect that T-Mobile US will post 10.53 EPS for the current fiscal year.

T-Mobile US Announces Dividend

The firm also recently disclosed a quarterly dividend, which will be paid on Thursday, September 10th. Stockholders of record on Friday, August 28th will be paid a dividend of $1.02 per share. This represents a $4.08 dividend on an annualized basis and a dividend yield of 2.4%. The ex-dividend date of this dividend is Friday, August 28th. T-Mobile US's dividend payout ratio (DPR) is 43.40%.

Key Headlines Impacting T-Mobile US

Here are the key news stories impacting T-Mobile US this week:

• Positive Sentiment: T-Mobile beat second-quarter profit expectations, with adjusted EPS topping estimates and year-over-year earnings growth supported by strong postpaid customer additions and higher service revenue. Reuters article
• Positive Sentiment: The company raised its annual adjusted free cash flow forecast, helped by customers migrating to higher-priced premium plans and stronger cash generation. Yahoo Finance article
• Positive Sentiment: Service revenue and postpaid account growth remained strong, underscoring T-Mobile’s ability to monetize its customer base and sustain industry-leading wireless growth. Business Wire article
• Neutral Sentiment: Management and coverage from several outlets suggest the market is focusing more on the revenue miss and slower subscriber growth than on the earnings beat, which is pressuring the stock despite solid fundamentals. Bloomberg article
• Negative Sentiment: Quarterly revenue came in slightly below expectations, and investors appear concerned that subscriber gains are slowing, which is overshadowing the stronger profit and cash flow outlook. Barrons article

Insider Buying and Selling

In related news, insider Andre Almeida bought 5,097 shares of the stock in a transaction on Friday, May 1st. The shares were purchased at an average price of $196.18 per share, for a total transaction of $999,929.46. Following the acquisition, the insider owned 44,850 shares in the company, valued at $8,798,673. This represents a 12.82% increase in their ownership of the stock. The purchase was disclosed in a legal filing with the SEC, which is available through the SEC website. Also, insider Michael J. Katz sold 5,000 shares of the firm's stock in a transaction on Friday, May 1st. The stock was sold at an average price of $195.81, for a total value of $979,050.00. Following the transaction, the insider directly owned 181,930 shares of the company's stock, valued at $35,623,713.30. The trade was a 2.67% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders own 0.32% of the company's stock.

Institutional Trading of T-Mobile US

A number of large investors have recently made changes to their positions in the stock. Norges Bank acquired a new stake in shares of T-Mobile US during the 4th quarter worth about $1,335,918,000. Price T Rowe Associates Inc. MD raised its holdings in T-Mobile US by 30.6% in the 4th quarter. Price T Rowe Associates Inc. MD now owns 27,795,065 shares of the Wireless communications provider's stock valued at $5,643,511,000 after acquiring an additional 6,516,968 shares during the last quarter. Dodge & Cox raised its holdings in T-Mobile US by 65.2% in the 4th quarter. Dodge & Cox now owns 6,185,972 shares of the Wireless communications provider's stock valued at $1,256,000,000 after acquiring an additional 2,442,450 shares during the last quarter. Pacer Advisors Inc. lifted its stake in shares of T-Mobile US by 1,375.9% during the 1st quarter. Pacer Advisors Inc. now owns 1,755,286 shares of the Wireless communications provider's stock worth $368,663,000 after purchasing an additional 1,636,359 shares during the period. Finally, Viking Global Investors LP lifted its stake in shares of T-Mobile US by 81.7% during the 2nd quarter. Viking Global Investors LP now owns 2,845,316 shares of the Wireless communications provider's stock worth $677,925,000 after purchasing an additional 1,279,422 shares during the period. Institutional investors and hedge funds own 42.49% of the company's stock.

About T-Mobile US

T-Mobile US is a national wireless carrier that provides mobile voice, messaging and data services to consumers, businesses and wholesale customers across the United States, Puerto Rico and the U.S. Virgin Islands. The company operates a nationwide mobile network and offers device sales, equipment financing and support services through retail stores, online channels and distribution partners. T-Mobile positions its products around bundled service plans, device offerings and value-added features for both individual and enterprise customers.

Product offerings include postpaid and prepaid wireless plans under the T-Mobile and Metro by T-Mobile brands, as well as connectivity solutions for small and large businesses.

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