T Mobile US (TMUS) AI Stock Analysis

• Market Cap: $288.18B
• Dividend Yield: 1.25%
• Average Volume (3M): 4.74M
• Price to Earnings (P/E): 24.2
• Beta (1Y): 0.43
• Revenue Growth: 5.31%
• EPS Growth: 38.46%
• Country: US
• Employees: 70,000
• Sector: Communication Services
• Sector Strength: 82
• Industry: Telecommunications Services
• EPS (TTM): 2.58
• Shares Outstanding: 1,135,445,100
• 10 Day Avg. Volume: 5,081,673
• 30 Day Avg. Volume: 4,741,280
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): 0.00
• Price to Cash Flow (P/CF): 0.00
• P/FCF Ratio: 0.00
• Enterprise Value/Market Cap: 1.44
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: 8.00
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $274.17
• Price Target Upside: 12.45% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 18

T-Mobile US exhibits strong financial health with robust revenue and profitability, supported by efficient cash generation. The earnings call highlighted impressive growth and strategic advancements in 5G technology, though technical analysis suggests potential short-term weakness. Valuation metrics indicate a high price relative to earnings, posing a risk of being overvalued. Overall, T-Mobile US maintains a strong position in the telecommunications industry, driven by innovation and strategic growth, but must manage valuation expectations and technical indicators.

Positive Factors

Customer Acquisition and Growth

TMUS continues to drive strong customer acquisition growth through a combination of its powerful marketing initiatives, its ultra-high-speed network, and the compelling value of its customer offerings.

Financial Performance

T-Mobile reported favorable 1Q Core EBITDA up almost 8% yoy on service revenue growth of 5% with a slight uptick in guidance mid-points for Core EBITDA and FCF.

Strategic Investments and Acquisitions

TMUS's wireless and wireline subscriber growth, expanding broadband services, and strategic acquisitions combined with increasing investments in AI-driven technologies will continue to drive accelerating business performance trends.

Negative Factors

Market Competition

T-Mobile also saw elevated churn - along with AT&T and Verizon - confirming the elevated level of competitive intensity in the market.

Market Valuation

A potentially more competitive wireless market may create risk to the level of premium at which it is trading to its competitors.

Postpaid KPIs

Shares could trade lower near-term on the absence of better postpaid KPIs.

T Mobile US Business Overview & Revenue Model

Company Description

T-Mobile US, Inc. is a leading telecommunications company in the United States, providing a wide range of wireless voice, messaging, and data services. The company operates as a subsidiary of Deutsche Telekom AG and is known for its innovative approach to mobile communications. T-Mobile's core offerings include cellular network services, mobile internet, and device sales, making it a major player in the wireless telecommunications sector.

How the Company Makes Money

T-Mobile US generates revenue primarily through the provision of wireless communications services to consumers and businesses. Its key revenue streams include postpaid and prepaid wireless service plans, which offer a variety of voice, messaging, and data options. The company also earns money from the sale of mobile devices, accessories, and equipment. Additionally, T-Mobile benefits from wholesale services and roaming agreements with other telecommunications providers. Significant factors contributing to its earnings include strategic partnerships, such as its merger with Sprint Corporation, which expanded its customer base and network capabilities, and its investment in 5G technology, enhancing service offerings and attracting new customers.

T Mobile US Financial Statement Overview

Summary

T-Mobile US demonstrates strong financial performance with noteworthy profitability and cash flow generation. The income statement highlights robust margins and revenue growth, while the balance sheet reflects a leveraged capital structure with effective equity utilization. Cash flow analysis indicates efficient cash generation and conversion, supporting overall financial health. Continued focus on managing debt levels and capital expenditures will be crucial for sustaining future growth.

Income Statement

The income statement reflects strong profitability with a gross profit margin of 72.7%, net profit margin of 14.4%, and an impressive EBIT margin of 22.7% for TTM. Revenue growth is healthy at 5.1% from the previous year, indicating positive momentum. The EBITDA margin is robust at 33.9%, highlighting efficient operations. Overall, the company demonstrates excellent revenue growth and profitability, although potential risks could include maintaining this level of growth in a competitive industry.

Balance Sheet

The balance sheet shows a debt-to-equity ratio of 1.90, indicating a significant reliance on debt. However, the return on equity stands strong at 19.5%, suggesting efficient use of equity capital. The equity ratio is moderate at 28.5%, reflecting a stable but leveraged capital structure. While the company maintains a solid return on equity, the high debt level poses a risk that needs monitoring.

Cash Flow

The cash flow statement displays a solid free cash flow growth rate of 20.0% and an operating cash flow to net income ratio of 2.02, indicating strong cash generation relative to net income. The free cash flow to net income ratio is 1.00, showing efficient conversion of income to cash. Cash flow metrics are healthy, but the company should continue to manage capital expenditures carefully to sustain free cash flow growth.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
81.40B	78.56B	79.57B	80.12B	68.40B
	Gross Profit
51.75B	45.89B	43.37B	43.51B	40.13B
	EBIT
18.01B	14.27B	6.54B	6.89B	6.64B
	EBITDA
31.04B	26.93B	27.13B	26.38B	23.58B
	Net Income Common Stockholders
11.34B	8.32B	2.59B	3.02B	3.06B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
5.41B	5.13B	4.51B	6.63B	10.38B
	Total Assets
208.03B	207.68B	211.34B	206.56B	200.16B
	Total Debt
113.94B	113.09B	107.86B	106.01B	104.22B
	Net Debt
108.53B	107.95B	103.35B	99.38B	93.83B
	Total Liabilities
146.29B	142.97B	141.68B	137.46B	134.82B
	Stockholders Equity
61.74B	64.72B	69.66B	69.10B	65.34B
Cash Flow		Free Cash Flow
9.98B	7.75B	-520.00M	-7.78B	-3.73B
	Operating Cash Flow
22.29B	18.56B	16.78B	13.92B	8.64B
	Investing Cash Flow
-9.07B	-5.83B	-12.36B	-19.39B	-12.71B
	Financing Cash Flow
-12.81B	-12.10B	-6.45B	1.71B	13.01B

T Mobile US Technical Analysis

• Technical Analysis Sentiment: Negative
• Last Price: 243.81
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TMUS, the sentiment is Negative. The current price of 243.81 is below the 20-day moving average (MA) of 252.08, below the 50-day MA of 257.20, and above the 200-day MA of 228.09, indicating a neutral trend. The MACD of -2.83 indicates Positive momentum. The RSI at 43.04 is Neutral, neither overbought nor oversold. The STOCH value of 67.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TMUS.

T Mobile US Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VZ	79 Outperform	$186.15B	10.34	18.23%	6.18%	0.93%	56.97%
CHTR	76 Outperform	$112.86B	11.15	36.94%	―	0.93%	16.06%
CMCSA	75 Outperform	$128.78B	8.46	18.57%	3.68%	1.33%	7.69%
TMUS	73 Outperform	$288.18B	24.20	19.35%	1.25%	5.31%	38.46%
T	72 Outperform	$202.63B	16.89	11.38%	3.99%	0.50%	-12.66%
AMX	71 Outperform	$52.64B	31.40	8.54%	2.97%	―	―
Sector *	60 Neutral	$13.44B	7.03	-2.73%	3.78%	2.17%	-39.43%

T Mobile US Corporate Events

T-Mobile US Appoints New Chief Accounting Officer

On April 8, 2025, T-Mobile US announced the appointment of Daniel J. Drobac as Vice President and Chief Accounting Officer, effective May 1, 2025, following the retirement of current CAO Dara Bazzano. Mr. Drobac, who has been with the company since 2017, will receive a new compensation package including a base salary of $400,000, short-term incentives, and long-term incentive awards, reflecting his expanded role and responsibilities within the company.

Spark’s Take on TMUS Stock

According to Spark, TipRanks’ AI Analyst, TMUS is a Outperform.

T-Mobile US scores highly due to its strong financial performance, positive technical indicators, and optimistic earnings guidance. The company’s strategic initiatives, such as the appointment of a new COO to enhance 5G capabilities, further strengthen its growth prospects. However, a relatively high P/E ratio suggests a potential overvaluation, and the high debt levels are a risk factor that the company needs to manage carefully.

To see Spark’s full report on TMUS stock, click here.

T-Mobile US Approves Executive Performance-Based Stock Units

On February 11, 2025, T-Mobile US, Inc.’s Compensation Committee approved performance-based restricted stock units (PRSUs) for several executives, effective April 1, 2025. These PRSUs are tied to the company’s core adjusted EBITDA performance from January 1, 2027, to December 31, 2027, with vesting contingent on continued employment through April 1, 2028. This move aims to align executive incentives with company performance, potentially impacting stakeholder interests and company operations.

T-Mobile US Amends Executive Compensation Plans

On March 17, 2025, T-Mobile US, Inc. amended its stock unit awards for executives, allowing for vesting under certain termination conditions, potentially impacting executive retention and alignment with company performance. Additionally, on March 18, 2025, T-Mobile entered into a compensation agreement with Michael J. Katz, ensuring his continued employment with a competitive salary and incentives, which may influence the company’s strategic marketing and product development initiatives.