- Growth of the sector’s leading clientele/ buy T-Mobile shares
- Huge cash/ buy T Mobile shares
- A merger in progress with Sprint / buy T-Mobile shares
T mobile stocks down 15% in the past 12 months, the market is offering investors an entry point. Indeed, a number of catalysts could help the wireless service provider reach new heights in the coming year. In particular, here are three reasons why you can consider buying T-Mobile stocks today.
The first quarter of 2018 marked the twentieth consecutive quarter, T-Mobile added more than one million net customers, and its seventeenth consecutive quarter of record growth.This is a great reason to buy stocks from T-Mobile
The company continues to disrupt the huge US wireless industry, with unconventional measures of offering only unlimited plans and eliminating contracts and overage fees. Innovative promotions, such as including free Netflix subscriptions in its family plans, further fueled its growth. This is a great reason to buy T-Mobile shares
These Un-Carrier Tactics Helped T-Mobile Outperform Sprint
become the third largest mobile operator in the United States. Now, the hard load company aims to reduce the gap between itself and the industry titans, Verizon and AT&T. This is good for buying T-Mobile shares
To do this, T-Mobile is aggressively investing in its wireless network. It purchased $ 8 billion of narrowband spectrum to strengthen and expand its LTE network so that it can “compete in every corner of the country”.
These investments are improving coverage and download speeds, as CEO John Legere said when calling the company’s fourth quarter results This is a reason to buy stocks from T-Mobile. This is good for buying T-Mobile shares
These significant gains made by subscribers help to significantly increase T-Mobile’s revenues and profits. Revenues increased 8.8% year over year to $ 10.5 billion in the first quarter, while adjusted EBITDA increased 10.8% to $ 3 billion. This is good for buying T-Mobile shares
Best of all, this rapidly growing customer base provides abundant cash flow generation. The company plans to generate annual free cash flow of between $ 4.5 billion and $ 4.6 billion by 2019, which would represent a compound annual growth rate over 3 years of 46% to 48% between 2016 and 2019.
This allows T-Mobile to invest in growth while returning money to investors through share buybacks, which should boost earnings on EPS and drive up its share price.
As you can see, T-Mobile is doing well on its own. Management is however seeking to accelerate its merger to become comparable in size to the American leaders in the wireless telecommunications sector by merging with Sprint. buy T-Mobile shares
Sprint and T-Mobile have already tried to unite twice, but were concerned that regulators could risk blocking the deals. T-Mobile shares However, under President Trump, who is widely perceived to be less concerned with antitrust and anti-competitive issues, an agreement can actually be reached this time around.
The proposed merger agreement values the combined company at around $ 146 billion, up from around $ 200 billion currently for each of its two biggest rivals. According to Strategy Analytics, this new and formidable company would have approximately 126 million customers, against 150 million for Verizon and 142 million for AT&T. buy T-Mobile shares
At this scale, a T-Mobile / Sprint combination would be able to generate profit margins much higher than those of either company, thanks in part to annual cost synergies estimated at $ 6 billion. And T-Mobile would eliminate a rival who has always been aggressive in discounting. As a result, the combined company would likely be able to offer fewer promotions, which could further increase margins. buy T-Mobile shares
In addition, the merged entity would be able to better use the precious assets of the Sprint spectrum, its larger cash flow allowing it to deploy these assets more quickly. In addition, it would have a more extensive store network, which T-Mobile has identified as an important growth driver. This is also another reason for buying T-Mobile shares
Perhaps the most interesting is that the two companies say that if they were allowed to merge, they would be able to “build the first wide and deep 5G network nationwide”. This would strengthen their ability to take advantage of the explosive growth of the Internet of Things and further strengthen their competitive position. This is also another reason for buying T-Mobile shares
Despite the change of government in Washington, it is still unclear whether regulators will approve the merger. Therefore, these potential benefits may not materialize. Even without such an agreement, however, T-Mobile would likely continue to increase the number of its subscribers and its free cash flow at the highest market rates. In addition, T-Mobile’s shares represent a very good deal. Long-term investors may want to consider buying T-Mobile stocks today buy T-Mobile shares .