TIGO (Buy, TP: $30, +30%) Millicom - Upgrades following Q1s support r...

Following strong Q1s last week we have pushed our target to $30, from $24. Underlying upgrades are 5-6% at EBITDA and we have trimmed capex further. Partly mitigating factors are 1/ We have cut our expectation for a dividend from Honduras, and 2/ Built in a 50% likelihood of a devaluation in Bolivia, though this doesn’t appear very imminent (we include in our valuation, not in estimates)

Efficiency masterpiece - up to BUY

Efficiencies well-executed, strong margin lift and low capex. We raise '24e-'26e EBITDA by 5-3%, and FCF by 7-6%. Up to BUY (Hold) on 14-19% '24e-'26e FCF yield with increased conviction.

Millicom (Buy, TP: $24) Q1 24 - Big (10%) EBITDA beat as Xavier Niel c...

On the back of a 1% revenue beat, it was mainly cost which drove a 10% underlying beat at EBITDA.

Strong Q1 across the board

Improving outlook

Q1e: EBITDA growth to reach double-digits, but limited FCF so far. Colombia upgrades on improved competitive outlook. Uncertainty outweighing the attractive 15% FCF yield, keep HOLD.

TIGO (Buy, TP: $24, +35%) Millicom - UPGRADE TO BUY: Xavier Niel helpi...

We have lifted estimates following better than expected Q4s and given the even stronger EFCF guide driven by Xavier Niel and management’s ambitious cost cutting program.

TIGO (Neutral, TP: $20, +16%) Millicom Q4s: FCF lift again - does Xav...

Millicom’s Q4s came in nicely ahead at EBITDA and with the positive surprise of another lift in the EFCF outlook through to the end of 2024. After a negative EFCF print for 2023, this implies a mammoth $550m for FY 24, and well ahead of consensus, driven by some “one off” factors in 2023 falling away, and with all indications this can be considered a floor level looking forward (our inference). If so this points to a sustainable EFCF yield of 19% after today’s share price lift.

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).

Millicom Q3s (Neutral, TP: $18, +20%) : The Iliad Way

Millicom reported Q3s today with ongoing sedate trends in revenue (~2% growth y/y) but with a strong EBITDA performance, beating by 5%, with Colombia notably printing historically high margins.

Millicom (Neutral, TP: $18 ($19), +15%) Millicom - Deal in Colombia f...

Millicom Q2s trends reported yesterday were weak, though within the parameters pre-guided to at the end of June. Perhaps most striking is the leverage of 3.34x as of Q2 which, including existing and potential Colombian spectrum liabilities (1.9 GHz and AWS), rises to nearer 3.75x. The solve for this could come from a deal in Colombia, though we will need 6-12 months to see whether this is approved ...

LatAm Telecoms High Yield - Starting Coverage

Following a similar initiative in Europe, we are picking up closer coverage of the high yield names in LatAm. In part there is a capital structure overlap with existing equities under coverage (Liberty LA and Millicom) but we have also separately engaged on new names: WOM in Chile (wireless, FTTH) and Totalplay in Mexico (FTTH). Our detailed understanding of these additional names should reinforce understanding of the relevant regional equities also (AMX, Megacable, Televisa).

TIGO (Buy, TP: $21, +23%) TEF (Buy, TP: EUR4.7, +30%) Millicom - Apol...

A flurry of activity. Millicom last night announced that discussions with Apollo regarding an offer for all of Millicom shares are off. This comes 24 hours after the announcement of a MOU between Telefonica and Millicom to merge their mobile networks in Colombia (in reality a pretty "full" merger potentially) AND the latest news on a 5G auction date in December.

Millicom (Buy, TP: $21, +18%) Q1 23: Model update: EBITDA miss, Colomb...

Millicom reported Q1s today. Service revenue was broadly in-line though EBITDA missed in part due to restructuring charges ($15m) and non-cash stock compensation ($5-6m) but stripping this out still missed by 3%.

TIGO (Buy, TP: $22, +17%) Slower growth but FCF comes through in Q4; ...

Millicom reported Q4s today. Service revenues and EBITDA came in in line with consensus while EFCF came in 3% above (but a touch below our expectations). Service revenue growth slightly slowed to 2.3% y/y in Q4, from 2.7% in Q3, driven by Mobile and B2B while the fixed business showed some modest inflection this quarter. EBITDA growth accelerated and is back into positive territory. EFCF performance this quarter was positive, with USD206m of EFCF; reiterating this would put Millicom on track to ...

LBTY (Buy, TP: $32, +45%) TIGO (Buy, TP: $22, +25%) Could Liberty Glo...

Following yesterday's confirmed discussions between Apollo/Claure and Millicom (and a rumoured bid coming at high teens USD price), we look at whether Liberty Global could counterbid in an attempt by John Malone to recreate the aborted 2019 merger between Liberty Latin America and Millicom.

TIGO US (Buy, TP: $22, +25%) Millicom - rumoured bid interest from Ap...

The FT is today reporting on rumoured bid interest in Millicom from Apollo / Claure at a "high teens" USD price. The stock has moved quickly to these levels, suggesting some validity. We look at deal multiples, leverage and implications/readacross in this short note.

New Street: TIGO (Buy, TP: $22, +85%) Millicom - Xavier Niel builds a...

Millicom disclosed after close on Friday that Xavier Niel, via Atlas Investissement, has built a 7% stake in Millicom. We would agree that this is an inexpensive asset with avenues for value creation. We highlight these and look at the implications for the stock.

Millicom - In play

Xavier Niel becomes largest shareholder with 7% stake Says supportive of Millicom’s strategy and management A likely first step only; Millicom now a take-over target

New Street: TIGO (Buy, TP: $22, +100%) Millicom (Buy) Q3's: Weak numbe...

Millicom reported Q3s today, with revenues missing consensus by 2% and EBITDA missing by 4.7%.

Millicom - Fighting macro headwinds

Q3 growth rates reflect weaker macro trends as expected ’22e-’24e EBITDA -2%, ‘22e EPS -35% on finance losses Risks to outlook and guidance but valuation upside