reports
- Soomit Datta
- Soomit Datta
AMX (Buy, TP: $24, +25%) Why a seemingly (quite) healthy Telco just f...
WOM Chile filed for Chapter 11 last month (April 1), followed a couple of weeks later by a local filing for WOM Colombia. Two filings in one month. Colombia’s relatively modest financing difficulties were likely sealed by the Chilean filing and we review events in Chile to work out how a seemingly successful scaled wireless operator (close to 25% market share of service revenue, 37% EBITDA margins) ended up here.
- Soomit Datta
AMX(Buy, TP: $24, +24%) Televisa (Neutral, $3.5, +11%) Megacable (Neut...
The market continued to eek out broadband growth in Q1, with Megacable leading the charge. We applaud management’s execution here and the double digit revenue and EBITDA growth, though this now seems embedded in expectations; we think it’s time to close out Megacable stock gains (30% YTD), trading on a 5.5% EFCF yield for 2025. Our target remains MXN55, though we have taken out the probability of cable-cable deal synergies, offset by upgrades following Q1s.
- Soomit Datta
AMX (Buy, TP: $24, +40%) AMX - Q1 24: Accelerating revenue and EBITDA...
AMX reported strong Q1 numbers after close, coming in ~2% ahead of consensus revenue and EBITDA. Growth accelerated (to 5% y/y from 3.7% in Q4) coming from Mexico and Brazil, and both fixed and wireless. Brazil EBITDA also saw strong support on the cost side. Capex was down y/y in Q1, in keeping with the FY 24 guide (~$7 billion, down from $8.8 billion in 2023); we expect mid-term capex to be provided at the upcoming May 7th Investor Day, and see potential for consensus estimates to come down he...
Moody's assigns Baa1 rating to America Movil's proposed notes; stable ...
Moody's Ratings (Moody's) has today assigned a Baa1 rating to America Movil, S.A.B. de C.V.'s ("America Movil") proposed up to MXN20,000 million ($1.1 billion) in senior unsecured global notes due 2029. America Movil's existing ratings remain unchanged. The outlook remains stable. Proceeds will be u...
- Soomit Datta
- Soomit Datta
AMX (Buy, TP: $24, +40%) AMX - Solid underlying Q4s, messy Argentina ...
AMX reported solid underlying Q4s last night, coming in 1.5% ahead of expectations for revenue and in-line at EBITDA adjusting for Argentina (which booked a large negative contribution to both given 9m 23 hyperinflation adjustments). Trends are in the main unchanged: Mexican wireless OK but lacking the support from price rises – this may come after the Presidential elections and is arguably needed as a catalyst for better earnings momentum; elsewhere, a return to solid adds in Mexican broadband;...
- Soomit Datta
LatAm Telcos – 2024 Outlook: Top picks Brazil (TIM and Vivo) and Megac...
After strong stock performance in 2023 we think the Brazilians will continue to perform into 2024 on the back of solid wireless fundamentals: rising prices, revenue/EBITDA > inflation, falling capex/sales – and with IOC (tax) risks in the rear view for now. Shareholder returns are also sector leading whilst valuations are attractive (notably versus quickly falling rates).
Moody's assigns Baa1 rating to America Movil's proposed notes; stable ...
Moody's Investors Service (Moody's) has today assigned a Baa1 rating to America Movil, S.A.B. de C.V.'s ("America Movil") proposed up to MXN20,000 million ($1.1 billion) in Senior Unsecured Global Notes due 2034. America Movil's existing ratings remain unchanged. The outlook remains stable. Proceeds...
- Soomit Datta
AMX (Buy, TP: $24, +40%) AMX Q3s - Broadly solid Q3, Buy back acceler...
AMX reported broadly solid Q3s after close last night, with revenue 1% ahead (supported by a towers sale) while EBITDA slightly missed (0.5%). However, this miss in EBITDA was driven by “Other” which tends to be a little volatile, whilst Mexico, Brazil and Colombia were slightly ahead.
- Soomit Datta
Mexican Cable/FTTH: Q3 outlook – Avoid the direct plays, but AMX looks...
We’re expecting Mexican fixed Q3 to be something of a replay of Q2 in terms of competitive dynamics/subscriber share: share gainers Megacable (Neutral) and Totalplay doing so at the expense of FCF (TPLAY 2025’s now yielding 26%), whilst Televisa (Neutral) continues to lose ground, compounded by write-offs and what looks to be a more cautious approach to client adds.
- Soomit Datta
AMX (Buy, TP: $27, +23%) America Movil Q2 23 - Small revenue/EBITDA m...
AMX reported Q2s after close last night. Both revenue and EBITDA slightly missed consensus and our forecasts, but net income beat expectations thanks to FX gains. Ultimately trends are robust, still supported by 1 month of Oi (on a y/y basis), though if there's an area of disappointment for our positive stance it's the still low level of buy back.
Moody's assigns Baa1 rating to America Movil's proposed sustainability...
Moody's Investors Service ("Moody's") today assigned a Baa1 rating to America Movil, S.A.B. de C.V.'s ("America Movil") proposed up to MXN20,000 million ($1.1 billion) in senior unsecured notes due 2031. America Movil's existing ratings remain unchanged. The outlook is stable. The proposed issuan...
- Soomit Datta
TIMP3 (Buy, TP: BRL21, +42%) VIVT3 (Buy, TP: BRL59, +34%) Brazilian T...
Despite a good run for the Brazilian telco equities of late we think there is much more to come over the next 12 months. Following some early testing of the water by the industry we now incorporate pre-paid wireless price increases into estimates noting how low spend as % income in Brazil should help prices stick (and reminds us of India); TIM is most geared into this segment and leads us to upgrade the stock to Buy, while we remain positive on Vivo and AMX (Brazil being 20% of EBITDA).
- Soomit Datta
AMX US (Buy, TP: $27, +23%) LILA US (Buy, TP: $14 (from $15), +85%) A...
VTR in Chile has disclosed the contribution of a convertible shareholder loan of $600m for AMX and LILA’s Chilean JV (ClaroVTR). It’s not clear that LILA has contributed its pro rata share (we’ll know at the Q2s) and the release suggests that conversion of the loans might not be in proportion to current equity levels (50/50) paving the way we think for AMX to take control of the JV over time.
- Chris Hoare
- David Lopes
EM Telcos Validating the Enterprise thesis
In this note we revisit and update our thesis that Enterprise in EM is following an S-Curve. Key new work shows that as a result, absolute incremental Enterprise revenue in China has doubled each year for the past 3 years. This is why overall Telco revenues have sharply accelerated. We show the other countries/ stocks where the early signs are of the same thing happening.
- Soomit Datta
- Soomit Datta
AMX - Upgrade to Buy (TP: $27): Lifting Mexican Wireless; Strong balan...
With good ARPU support from post-paid 5G, and in launch phase for pre-paid, we are lifting mid-term estimates for Mexican wireless (worth $2.5/ADR); we think this business, with a globally unique market structure, merits a 9x 24e EBITDA multiple.
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