T-Mobile U.S. shares rise after Oppenheimer assigned a price target of $160

By: Stanko Iliev
Stanko Iliev
Stanko dedicates himself to providing investors with relevant information they can use to make investment decisions. He loves the… read more.
on Dec 23, 2020
  • T-Mobile U.S. has plans to cover more than 50% of U.S. households with home internet
  • Total revenue has increased by 74.2% Y/Y to $19.27B in Q3
  • As long the price is above $100, there is no risk of the trend reversal

T-Mobile U.S. (NASDAQ: TMUS) shares have advanced from $77 above $133 since the beginning of the 2020 year, and the current price stands around $132. T-Mobile U.S. reported that total revenue has increased by 74.2% Y/Y in Q3, but with a $164B market capitalization, this stock is expensive, in my opinion.

Fundamental analysis: Oppenheimer reported that T-Mobile U.S. has an attractive valuation compared to its peers

T-Mobile US is an American wireless network operator, but its largest shareholder is the German telecommunications company Deutsche Telekom with a 43% share. T-Mobile U.S. is a stable company that operates with a profit, and it is also important to mention that Warren Buffett’s Berkshire Hathaway has bought shares of this company recently.

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T-Mobile U.S. reported Q3 results at the beginning of November; total revenue has increased by 74.2% Y/Y to $19.27B while Q3 GAAP EPS was $1.00 (beats by $0.57). Total revenue has increased above the expectations (+ $960M), and the company raised its F.Y. 2020 outlook.

T-Mobile U.S. shares are trading near record levels, and with a $164B market capitalization, this stock is expensive, in my opinion. The stock price has advanced after analyst firm Oppenheimer announced that T-Mobile U.S. still has an attractive valuation compared to its peers and assigned a price target of $160.

“T-Mobile U.S. has outperformed our expectations with a limited competitive response as its peers seek to maximize FCF.  TMUS is building the only true 5G network on 80MHz of this spectrum, giving it a two-year-or-so market advantage from a 10x improvement in speed,” said Analyst Timothy Horan from Oppenheimer.

This November, the company has announced that it is moving aggressively in the Home Internet segment, expanding the pilot program to more than 130 additional markets. New users can sign up for the $50/month service, and the company has plans to cover more than 50% of U.S. households within six years.

Technical analysis: As long the price is above $100, there is no risk of the trend reversal

T-Mobile U.S. shares have performed well since the beginning of the 2020 year, and as long the price is above $100, this stock remains in the “bull” market.

Data source: tradingview.com

The critical support levels are $120 and $100; $140 and $150 represent the resistance levels. If the price jumps above $140, it would be a signal to buy T-Mobile U.S. shares, and the next target could be around $150.

On the other side, if the price falls below the $100 support level, it would be a firm “sell” signal and a sign of the trend reversal.

Summary

T-Mobile U.S. shares are trading near record levels, and with a $164B market capitalization, this stock is expensive, in my opinion. The stock price has advanced after analyst firm Oppenheimer announced that T-Mobile U.S. still has an attractive valuation compared to its peers and assigned a price target of $160.

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