- TMUS reported strong postpaid net ads in fourth quarter.
- GOOG decides to enter into MVNO arrangement with TMUS and S.
- MVNO arrangement will help TMUS increase its future revenues.
- TMUS shares have rallied strongly since hitting lows in December.
- Fundamental weaknesses in its balance sheet and financials are overlooked.
- Flaws of TMUS's aggressive strategy and 'Uncarrier' model are not given enough attention.
- Expectation of increased profitability due to glut of new subscribers is exaggerated.
Update: T-Mobile Adds More Subscribers In Q4 Without Adding Value
- T-Mobile released solid Q4 customer additions.
- The stock remains a Sell.
- The data released by T-Mobile doesn't change the ongoing investment thesis that the stock must be avoided until aggressive pricing stops hitting earnings.
- T-Mobile looks to boost ARPU with Data Stash's minimum 3GB+ requirement and looks to upsell entry level users higher to attain the value features.
- With only a 1GB threshold tablet plan minimum, Data Stash can complement tablet promotions to drive 2015 tablet net additions.
- With the new crop of new prime customers switching to T-Mobile for value, Data Stash is another value feature that can be used for subscriber retention.
T-Mobile Subscriber Momentum Expected To Continue As ARPU Becomes Pressurized
- Company has done well in competitive environment and has managed to build solid subscriber momentum in the third quarter.
- Growth expected to continue in future due its competitive pricing and industry-best 4G LTE speeds.
- ARPU to be pressurized in the future due to aggressive pricing, which limits management’s ability to expand margins.
iPhone 6: T-Mobile Brings Exciting Cyber Monday Deals
- T-Mobile continues making impressive progress in growing the customer base.
- The lack of focus on the bottom line is a red flag to investors.
- As long as the 2015 EPS trend is down, investors must avoid the stock.
- Healthy growth in postpaid subscriber base due to luring subscribers with attractive pricing offers and Un-carrier strategies.
- Company has favorable growth prospects lined up to grow subscriber base and fuel top-line numbers.
- TMUS all geared up to expand margins and add towards growth of bottom-line numbers.
Update: T-Mobile Q3 Earnings - And The Momentum ContinuesSoid Ahmad • Oct. 29, 2014
- T-Mobile added 2.3 million postpaid customers surpassing AT&T’s and Verizon’s net additions for the third quarter. Revenue was almost in-line but the company missed EPS estimate, thanks to the aggressive pricing strategy.
- I maintain the $39 price target amid continuing subscriber momentum.
- The previous piece clearly mentioned that T-Mobile will continue to add subscribers amid un-carrier incentives. However, any strategy to improve ARPU can hurt subscriber growth during the next year.
T-Mobile Q3 Earnings: Are Investors 'Getting More'?
- T-Mobile is still small compared to competitors T and VZ.
- Financials are booming for the smaller telecommunications company relative to giants.
- Though seeing volatility today, low stock price may indicate a good time to get involved in the company.
- Iliad ends pursuit of acquiring a large position in T-Mobile.
- Investors should dump the stock.
- The original article anticipated that a positive outcome wasn't likely for a T-Mobile sell as time passed due to the ongoing price wars in the domestic wireless market.
- Company posted record number of gross ads in August.
- Postpaid ARPU and churn rate don’t paint encouraging outlook for company.
- The company announced its new initiative with free WiFi calling and text messages.
- TMUS retains attractiveness for M&A activity.
T-Mobile: Still The Best Stock For Growth In Telecoms
- This 4th place wireless telecom is making a serious move for third place.
- There’s still a potential for a buyout, but there’s more upside if the company goes at it alone.
- Shares are down 20% from their 52-week highs from just four months ago and looks to be a buying opportunity.
Strategic Initiatives And Un-Carrier Strategies Key To Earning T-Mobile A Bullish ThesisEquity Watch • Sep. 22, 2014
- Company doing well by expanding postpaid subscriber base through ongoing strategic initiatives.
- Stays well on track to improving postpaid subscriber growth and competitive position in industry.
- Company likely to benefit from attractive pricing for iPhone 6 and 6 Plus.
T-Mobile: Organic Growth, Acquisitive Potential Justifies A 25% Upside
- T-Mobile continues to add subscribers due to aggressive pricing plans like Simple Choice.
- There is evidence of network quality improvement, and the company is further investing in airwaves.
- Going forward, T-Mobile is planning to maintain subscriber momentum through differentiated offerings that will result in stable ARPU.
- Price target is upgraded to $39 amid organic growth prospects and acquisitive potential of T-Mobile.
- T-Mobile announced record branded customer additions.
- Stock remains a short-term buy based on subscriber momentum.
- Subscriber additions were anticipated to help T-Mobile bounce back, but long-term issues loom with plunging earnings estimates.
- Deutsche Telekom lowered the hurdle for buying T-Mobile.
- The potential acquirers face debt concerns, especially if Deutsche Telekom still wants mostly cash.
- Domestic wireless war is likely pressuring Deutsche Telekom to exit via a lower offer.
- Although a Sprint deal is off the table, there's still other suitors.
- There's a motivated seller in T-Mobile's parent company.
- And there's plenty of value in T-Mobile's business model given its industry-changing initiatives.
Apr. 9, 2014, 11:54 AM
- T-Mobile USA's (TMUS +1%) Simple Starter plan provides unlimited talk/text and 500MB of 4G data for $40/month.
- The carrier makes a point of noting the plan lacks the data overage fees charged by rivals. Assuming Simple Starter works like other T-Mobile plans, users will simply have their data speeds throttled after going over 500MB.
- The plan is just the latest in a string of aggressive pricing moves from T-Mobile, moves that have triggered responses from AT&T and others. The company has already begun offering up to $650 in credit to get users to switch, and has rolled out relatively inexpensive smartphone upgrade and international roaming plans.
Apr. 7, 2014, 10:45 AM
- With all signs suggesting U.S. regulators remain opposed to a Sprint/T-Mobile USA merger in spite of Masayoshi Son's PR campaign, rumors have emerged SoftBank (SFTBF) will turn its sights on acquiring Vodafone (VOD +0.9%) if its efforts to fuse the #3 and #4 U.S. carriers are thwarted.
- It's worth noting Vodafone ($96B market cap) would be much harder for SoftBank ($87B) to digest than T-Mobile ($26B). If it was to try, SoftBank would doubtlessly make use of its 37% stake in soon-to-be-public Alibaba (could have a $50B+ pre-tax value).
- Sprint (S -2.6%) and T-Mobile (TMUS -1.5%) are seeing moderate declines.
Apr. 2, 2014, 10:26 AM
- Less than amused with a T-Mobile USA (TMUS -0.1%) ad campaign urging BlackBerry (BBRY +1.4%) owners to buy iPhones, BlackBerry says it won't renew T-Mobile's license to sell its products, which expires on April 25. Existing users on T-Mobile's network won't see any changes.
- As it is, T-Mobile stopped stocking BlackBerrys in its retail stores six months ago (they've remained available online). Moreover, with local sales having plunged, the U.S. now only accounts for a small fraction of BlackBerry's hardware sales, and T-Mobile (has a relatively small corporate base) a small percentage of U.S. sales.
Mar. 27, 2014, 11:52 AM
- SoftBank's (SFTBF) $3.17B sale of Japanese mobile ISP eAccess to Yahoo Japan is fueling speculation the Sprint (S +3.6%) parent is raising funds for a T-Mobile USA (TMUS +1.4%) bid.
- In spite of regulatory pushback, SoftBank's Masayoshi Son continues to press his case for a deal. "A duopoly is taking over our country," he declared today at an industry trade show. "if you look at [the past] five years … it is a fact that those two big companies increased [their market share] from 56% to 73%. What happens in the next five years?"
- T-Mobile's recent share gains (following years of losses) might have regulators thinking the next five years could go differently than the last five. The ripple effects of the #4 carrier's aggressive pricing might also influence their thinking.
- Son has promised he'd launch a "price war" if a Sprint/T-Mobile deal was approved, and that the merged carrier would act as a last-mile broadband rival to cable/phone duopolies - that could be easier said than done in densely-populated urban areas.
Mar. 11, 2014, 10:47 AM
- Ahead of a big speech at the U.S. Chamber of Commerce, SoftBank's (SFTBF, SFTBY) Masayoshi Son is promising a "massive price war" if skeptical regulators allow Sprint (S +0.7%) to merge with T-Mobile USA (TMUS +2.4%).
- As expected, Son also insists Sprint and T-Mobile, who between them have a giant portfolio of high-frequency spectrum assets, could act as a credible last-mile broadband rival to phone/cable duopolies if they joined forces.
- AT&T (T -0.8%) and Verizon (VZ -0.6%) are ticking lower, while Sprint and T-Mobile are up moderately. AT&T has already been cutting prices to counter T-Mobile's aggressive moves - moves that have contributed to FCC/DOJ doubts about the merits of a Sprint/T-Mobile deal.
- Verizon, for now, is refusing to take part in a price war, and betting its service quality and unmatched 4G coverage will lead its pospaid subs to continue paying a premium.
- Yesterday: U.S. mobile roundup
Mar. 10, 2014, 2:54 PM
- AT&T (T -0.3%), which unflinchingly stuck with a premium pricing strategy for years, has announced yet another price cut for its Mobile Share plans (previous), as it tries to fend off a share-gaining Verizon and a resurgent T-Mobile.
- The price of Ma Bell's low-end 2GB Mobile Share plan has been cut by $15/month. The base price for a single user is now $40/month; adding a smartphone via AT&T's Next upgrade plan adds $25/month to the bill. Opting for a traditional phone subsidy/contract instead of Next costs $40/month.
- T-Mobile (TMUS +0.3%) , meanwhile, has simultaneously increased its data allotments for cheaper postpaid plans - a $50/month plan featuring unlimited voice/text now provides 1GB of data, up from 500MB - and hiked the price of its unlimited data offering by $10 to $80/month.
- Verizon (VZ -0.5%), which has offered some minor price cuts and promotions lately, insists it won't depart from its premium pricing strategy. CFO Fran Shammo: "We’re not going to buy customers ... You have to earn customers." Shammo also reiterates Verizon's support for subsidies (and with them, service contracts), and says the carrier will take a cautious approach to installment plans.
- Bloomberg reports SoftBank's (SFTBF, SFTBY) Masayoshi Son, facing regulatory opposition to his plans for a Sprint (S +0.4%) bid for T-Mobile, will shift from arguing a merger is needed combat Verizon/AT&T to arguing a deal will allow Sprint/T-Mobile to act as a last-mile broadband alternative to phone/cable duopolies. Son is due to make a speech tomorrow.
Mar. 6, 2014, 1:49 PM
- "I don’t want to insist on [U.S. mobile] consolidation, but I don’t want to rule it out," says Deutsche Telekom (DTEGY, DTEGF) CEO Tim Hoettges.
- The remarks come after Hoettges reportedly told DT's board he considers a sale of 67%-owned T-Mobile USA (TMUS -1.8%) unlikely in the near-term, given regulatory opposition to a bid from Sprint (S -3.6%) and parent SoftBank (SFTBF, SFTBY).
- Citing T-Mobile USA's aggressive investments, DT now expects its 2015 free cash flow to only be up "slightly" from 2014 levels. The carrier previously forecast 2015 FCF to rise to €6B ($8.3B) after hitting €4.2B ($5.8B) in 2014.
- Sources tell Bloomberg Hoettges is now "taking a long-term view in the U.S.," and is focused on converting more of T-Mobile's giant prepaid base into postpaid subs.
- DT shares fell 3.6% in Frankfurt. Both T-Mobile and Sprint are selling off in U.S. trading.
- More on Sprint/T-Mobile
Mar. 5, 2014, 4:03 PM
- Deutsche Telekom (DTEGY, DTEGF) Tim Hoettges says a sale of 67%-owned T-Mobile USA (TMUS +0.1%) is unlikely anytime soon. T-Mobile and Sprint (S -0.5%) have both moved moderately lower in response.
- The WSJ reported yesterday SoftBank's (SFTBF, SFTBY) Masayoshi Son plans to mount a PR campaign to convince skeptical businesses and policy makers regarding the value of a Sprint/T-Mobile merger.
- Sprint/SoftBank have been widely reported to be lining up financing for a T-Mobile bid.
Mar. 4, 2014, 2:02 PM
- With FCC/DOJ regulators strongly suggesting they'll oppose any attempt by Sprint (S +3.1%) to merge with T-Mobile USA (TMUS +3.6%), SoftBank's (SFTBF, SFTBY) Masayoshi Son "plans to appeal directly to the U.S. business community and policy makers" to convince them the deal would be good for customers, the WSJ reports.
- Crucial to Son's effort: Convincing his audience Verizon and AT&T currently have a de facto U.S. mobile duopoly, one that Sprint and T-Mobile can't challenge independently.
- Likely to hurt his cause: T-Mobile is now rapidly adding postpaid subs (after losing them for years) with the help of innovative pricing schemes, and regulators reportedly fear a Sprint merger could affect T-Mobile's "maverick" status within the industry.
- Sprint and T-Mobile are both outperforming today. Son plans to make a major presentation on March 11 at the Chamber of Commerce in Washington D.C.
- More on Sprint/T-Mobile
Mar. 3, 2014, 5:57 PM
- Via its new AllSet prepaid plans, Verizon (VZ) is offering unlimited voice/text and 500MB of data to prepaid smartphone users for $45/month. Users can obtain an extra 500MB for $5, 1GB for $10, and 2GB for $20. Feature phone users only pay $35/month, but their voice minutes are capped at $500.
- Previously, Verizon offered unlimited voice/text and 2GB of data to smartphone users for $60/month, with an extra 2GB available for $10. Thus the carrier's new plans amount to a price cut for light data users, but not for heavier ones.
- Verizon is looking to better compete against T-Mobile USA (TMUS), which added 112K branded prepaid subs in Q4 and is expanding the reach of its MetroPCS brand. AT&T, on the verge of acquiring Leap Wireless and its Cricket prepaid brand, has also been fighting over a prepaid market that's responsible for much of the U.S. mobile industry's remaining growth.
Feb. 25, 2014, 2:23 PM
- After opening near breakeven following its Q4 report, T-Mobile USA (TMUS -6.1%) has gradually sold off.
- The #4 U.S. carrier, which halted years of postpaid sub losses last year with the help of the iPhone and aggressive/novel subscription plans, expects to add 2M-3M branded postpaid subs in 2014, compared with 2M in 2013. Cash capex is expected to grow to $4.3B-$4.6B from 2013's $4.2B, and adjusted EBITDA (-17% Y/Y in 2013) to $5.7B-$6B from 2013's $5.3B.
- As announced on Jan. 8, T-Mobile added 1.645M total subs, 869K branded postpaid subs, and 112K branded prepaid subs in Q4.
- "Simple free cash flow" (adjusted EBITDA - cash capex) rose 79% Y/Y to $357M, and totaled $1.08B for the whole of 2013 (-59% Y/Y). ARPU fell 2.9% Q/Q to $50.70.
- Q4 results, PR
Feb. 25, 2014, 6:10 AM| Comment!
Feb. 25, 2014, 12:05 AM
Feb. 24, 2014, 5:30 PM
Feb. 14, 2014, 5:04 PM
- In addition to establishing a BlackBerry position, Dan Loeb's Third Point LLC took a 600K-share stake in Baidu (BIDU), a 7.6M-share stake in T-Mobile USA (TMUS) and a 1M-share stake in NXP (NXPI) during Q4. At current levels, the positions are respectively worth $100M, $237M, and $56M. NXPI +1% AH.
- On the other hand, Loeb unloaded the 4.4M-share Tibco (TIBX) position he had at the end of Q3. There were hopes Loeb would use his Tibco stake to push for a spinoff of the company's faster-growing Business Optimization unit. TIBX -1.7% AH.
- Loeb also cut his remaining Yahoo (YHOO) position in half to 8M shares. Third Point once had a 60M-share stake in Yahoo, before striking a deal last August to sell 40M shares back to the company and leave its board.
- Third Point's 13F
Feb. 12, 2014, 10:20 AM
- Deutsche's Brett Feldman has upgraded Sprint (S +1.4%) to Buy following yesterday's Q4 report, albeit while leaving his PT unchanged at $9.25. He cites Sprint's spectrum advantage (presumably a reference to its high-frequency assets following the Clearwire deal), and the carrier's 2-year EBITDA growth outlook.
- However, Feldman still expects major subscriber losses in 1H14, followed by "a return to modest growth" once Sprint's Network Vision 4G initiative is finished. He's also skeptical a T-Mobile USA (TMUS +0.4%) deal will happen in light of regulatory concerns.
- But while regulators continue signaling their skepticism, SoftBank's (SFTBF) Masayoshi Son appears undeterred in his quest to merge the #3 and #4 U.S. U.S. mobile carriers. Son tells the WSJ it would be "a dream within a dream" to challenge Verizon and AT&T without the scale provided by an acquisition. "I can't settle for No. 3 or No.2. It's my personality."
- Recent WSJ and Bloomberg reports suggested Sprint/SoftBank are weighing their options in the wake of recent DOJ/FCC comments.
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