TMUS - Embedded Expectations Analysis - 2021 07 13
T-Mobile US, Inc. (TMUS:USA) currently trades above historical averages relative to UAFRS-based (Uniform) earnings, with a 43.8x Uniform P/E. At these levels, the market is pricing in expectations for profitability to stabilize near historical highs, but management appears concerned about free cash flow guidance, their network perception and positioning, and their 5G buildout and leadership.Specifically, management may lack confidence in their ability to meet free cash flow, Postpaid ARPA, and merger synergy guidance. Furthermore, they may have concerns about migrating Sprint customers to go-forward rate plans, merger-related costs, and their debt structure. Moreover, management may be exaggerating the potential of the Hometown Experts distribution model, the progress of their 5G buildout, and the superiority of their 5G network. Additionally, they may lack confidence in their ability to gain 20% market share in the next few years, improve their network perception, and maintain their 5G leadership. Finally, management may have concerns about Sprint customer churn rates, the impact of the return of travel and declines in stimulus, and customer engagement among acquired Sprint customers.
T-Mobile US provides mobile communications services, including voice, messaging and data, under its brands, T-Mobile and Metro? by T-Mobile, in the United States, Puerto Rico and the United States Virgin Islands. The company provides mobile communications services using its 4G Long-Term Evolution network and its 5G technology network. The company also provides various wireless devices, including handsets, tablets and other mobile communication devices, and accessories for sale, as well as financing through Equipment Installment Plans and leasing through JUMP! On Demand?. The company provides reinsurance for handset insurance policies and extended warranty contracts offered to its mobile communications customers.
In 2009, just as the dust was settling from the last major equity and credit market crises, we launched a boutique research firm with the intention of breaking Wall Street’s biases and broken incentives:
- GAAP and IFRS have failed to provide rules for reliable financial statement reporting
- Stock analyst recommendations are not grounded in disciplined financial analysis
- Credit agencies have been set up to grossly fail in their responsibilities to investors and the public markets
- Utter lack of willingness of major research firms to employ the the most advanced forensic analysis available
We sought to provide investors and company analysts with a source of information that changed all that.
Many years later, our business model remains because little has changed on Wall Street.
- Corporate credit ratings remain years behind the fundamental underpinnings of company performance
- Stock analysts continue to make recommendations with deeply inherent biases
- Research firms have failed to break down the walls between credit, equity, and macroeconomic research
- The governing accounting bodies have created more leeway for mis-estimates and mis-classifications as financials have become unwieldy and overwhelming
The integrity of Valens Research is founded in our disciplined processes and analytics. No “star” analysts. No corporate advisory relationships. No-nonsense opinions and recommendations.
Unfortunately, this report is not available for the investor type or country you selected.
Browse all ResearchPool reportsReport is subscription only.
Thank you, your report is ready.
Thank you, your report is ready.