We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
T-Mobile US (TMUS) Up 2.7% Since Earnings Report: Can It Continue?
Read MoreHide Full Article
It has been about a month since the last earnings report for T-Mobile US, Inc. (TMUS - Free Report) . Shares have added about 2.7% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
T-Mobile US Tops Q4 Earnings, Revenue Estimates
GAAP net income in the reported quarter was $390 million or $0.45 per share compared with net income of $297 million or $0.34 in the year-ago quarter. Quarterly earnings per share of $0.45 were well above the Zacks Consensus Estimate of $0.29.
Total revenue jumped 23.4% year over year to $10,175 million in the reported quarter surpassing the Zacks Consensus Estimate of $9,838 million. Segment-wise, Service revenues were up 10.5% year over year to $7,245 million. Sales from Equipment totaled $2,740 million, up a significant 78.4% year over year while Other revenues were $190 million, up 22.6% year over year.
Quarterly operating income was $942 million compared with $838 million in the year-ago quarter. Operating margin in the reported quarter was 9.3% compared with 10.2% in the prior-year quarter. Adjusted EBITDA was $2,548 million, up 11.8% year over year. Adjusted EBITDA margin was 25% compared with 27.6% in the year-ago quarter.
Cash Flow
In the fourth quarter of 2016, T-Mobile US generated $1,602 million of cash from operations compared with $2,233 million in the prior-year quarter. Adjusted free cash flow in the reported quarter was $780 million compared with the $897 million in the year-ago quarter.
Liquidity
At the end of 2016, T-Mobile US had $5,500 million of cash and cash equivalents and short-term securities and $22,186 million of debt outstanding compared with $4,582 million and $26,061 million, respectively, at the end of 2015. The debt-to-capitalization ratio at the end of 2016 was 0.54 compared with 0.55 the end of 2015.
Subscriber Statistics and Other Metrics
As of Dec 31, 2016, the total customer base of T-Mobile US was 71.455 million, up 12.9% year over year. Branded postpaid phone customers totaled 31.297 million, up 6.6%. Branded postpaid mobile broadband customer count was 3.13 million, surging 33.8%. Branded prepaid customer count was 19.813 million, up 12.4%. Wholesale customers tallied 17.215 million, up 23.4%.
In the reported quarter, T-Mobile US added net 0.933 branded postpaid phone customers, 0.264 branded postpaid mobile broadband customers, 0.541 branded prepaid customers and 0.363 wholesale customers. Total net customer addition was 2.101 million, signifying the 15th successive quarter of over one million net customer additions. Quarterly branded postpaid churn was 1.28% compared with 1.46% in the year-ago quarter. Branded prepaid churn was 3.94% compared with 4.20% in the prior-year quarter.
Quarterly branded postpaid phone average revenue per user (ARPU) was $48.37 compared with $48.05 in the prior-year quarter. Branded prepaid ARPU was $38.20 compared with $37.63 in the prior-year quarter. Branded postpaid average billing per user (ABPU) was $63.08 compared with $63.74 in the year-ago quarter.
Guidance
For 2017, the company anticipates adjusted EBITDA to be in the range of $10.4 - $10.8 billion. Capital expenditure will be in the range of $4.8 - $5.1 billion. The company expects branded postpaid net customer addition to fall in the range of 2.4 to 3.4 million. Its mid-point of 2.9 million is well below the 2016 net addition of 3.3 million.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
At this time, T-Mobile US's stock has a great Growth Score of 'A', though it is lagging a lot on the momentum front with an 'F'. However, the stock was allocated a grade of 'B' on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'A'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for growth investors than value investors.
Outlook
The stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
T-Mobile US (TMUS) Up 2.7% Since Earnings Report: Can It Continue?
It has been about a month since the last earnings report for T-Mobile US, Inc. (TMUS - Free Report) . Shares have added about 2.7% in that time frame, outperforming the market.
Will the recent positive trend continue leading up to the stock's next earnings release, or is it due for a pullback? Before we dive into how investors and analysts have reacted as of late, let's take a quick look at its most recent earnings report in order to get a better handle on the important drivers.
T-Mobile US Tops Q4 Earnings, Revenue Estimates
GAAP net income in the reported quarter was $390 million or $0.45 per share compared with net income of $297 million or $0.34 in the year-ago quarter. Quarterly earnings per share of $0.45 were well above the Zacks Consensus Estimate of $0.29.
Total revenue jumped 23.4% year over year to $10,175 million in the reported quarter surpassing the Zacks Consensus Estimate of $9,838 million. Segment-wise, Service revenues were up 10.5% year over year to $7,245 million. Sales from Equipment totaled $2,740 million, up a significant 78.4% year over year while Other revenues were $190 million, up 22.6% year over year.
Quarterly operating income was $942 million compared with $838 million in the year-ago quarter. Operating margin in the reported quarter was 9.3% compared with 10.2% in the prior-year quarter. Adjusted EBITDA was $2,548 million, up 11.8% year over year. Adjusted EBITDA margin was 25% compared with 27.6% in the year-ago quarter.
Cash Flow
In the fourth quarter of 2016, T-Mobile US generated $1,602 million of cash from operations compared with $2,233 million in the prior-year quarter. Adjusted free cash flow in the reported quarter was $780 million compared with the $897 million in the year-ago quarter.
Liquidity
At the end of 2016, T-Mobile US had $5,500 million of cash and cash equivalents and short-term securities and $22,186 million of debt outstanding compared with $4,582 million and $26,061 million, respectively, at the end of 2015. The debt-to-capitalization ratio at the end of 2016 was 0.54 compared with 0.55 the end of 2015.
Subscriber Statistics and Other Metrics
As of Dec 31, 2016, the total customer base of T-Mobile US was 71.455 million, up 12.9% year over year. Branded postpaid phone customers totaled 31.297 million, up 6.6%. Branded postpaid mobile broadband customer count was 3.13 million, surging 33.8%. Branded prepaid customer count was 19.813 million, up 12.4%. Wholesale customers tallied 17.215 million, up 23.4%.
In the reported quarter, T-Mobile US added net 0.933 branded postpaid phone customers, 0.264 branded postpaid mobile broadband customers, 0.541 branded prepaid customers and 0.363 wholesale customers. Total net customer addition was 2.101 million, signifying the 15th successive quarter of over one million net customer additions. Quarterly branded postpaid churn was 1.28% compared with 1.46% in the year-ago quarter. Branded prepaid churn was 3.94% compared with 4.20% in the prior-year quarter.
Quarterly branded postpaid phone average revenue per user (ARPU) was $48.37 compared with $48.05 in the prior-year quarter. Branded prepaid ARPU was $38.20 compared with $37.63 in the prior-year quarter. Branded postpaid average billing per user (ABPU) was $63.08 compared with $63.74 in the year-ago quarter.
Guidance
For 2017, the company anticipates adjusted EBITDA to be in the range of $10.4 - $10.8 billion. Capital expenditure will be in the range of $4.8 - $5.1 billion. The company expects branded postpaid net customer addition to fall in the range of 2.4 to 3.4 million. Its mid-point of 2.9 million is well below the 2016 net addition of 3.3 million.
How Have Estimates Been Moving Since Then?
Analysts were quiet during the last one month period as none of them issued any earnings estimate revisions.
T-Mobile US, Inc. Price and Consensus
T-Mobile US, Inc. Price and Consensus | T-Mobile US, Inc. Quote
VGM Scores
At this time, T-Mobile US's stock has a great Growth Score of 'A', though it is lagging a lot on the momentum front with an 'F'. However, the stock was allocated a grade of 'B' on the value side, putting it in the second quintile for this investment strategy.
Overall, the stock has an aggregate VGM Score of 'A'. If you aren't focused on one strategy, this score is the one you should be interested in.
Our style scores indicate that the stock is more suitable for growth investors than value investors.
Outlook
The stock has a Zacks Rank #3 (Hold). We are expecting an inline return from the stock in the next few months.