Millicom International Cellular Positioned To Reward Investors

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About: Millicom International Cellular S.A. (TIGO), Includes: AMX, S, T, TEF, TMUS, VOD, VZ
by: Capital Ideas
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Long only, value, long-term horizon, special situations

Millicom, which holds the leading position in several small markets in Latin America, has limited its competition and lifted its EBITDA margins a third higher than the telecom industry average.

Following the saturation of the mobile voice market, Millicom has shifted its business to broadband, data, and pay television, which has lifted its growth rate back to the mid-single digits.

African divestitures have already brought in about $400 million in proceeds and could bring an additional $1 billion+ if Millicom completely left the continent.

The company is too cheap at 5.5x adjusted EV/EBITDA, and shares could rise by 50% by year's end.

Investment Thesis

Millicom International Cellular's (OTCPK:MIICF) share price has been battered since 2011, dropping from $121 per share in August of that year to a recent price of $60. Much of the pessimism