T-Mobile U.S. shares are down 9.3% YTD. Should I invest?

T-Mobile U.S. (NASDAQ: TMUS) shares have weakened from $130 to $115.8 since the beginning of January, and the current price stands around $119. T-Mobile U.S. reported better than expected Q4 results in February and raised its 2021 guidance.

Fundamental analysis: T-Mobile U.S. expects a further increase in revenues in 2021

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, but shares of this company have weakened more than 9% since the beginning of the year.

T-Mobile U.S. reported Q4 results this February; total revenue has increased 71.2% Y/Y to $20.34B while Q4 GAAP EPS was $0.60 (beats by $0.12). It is important to say that Q4 results beat financial expectations, but the higher revenue was due to the merger with Sprint (the Sprint merger closed April 1, 2020).

The higher revenues from the merger partly offset sharply higher expenses, so net income stayed nearly unchanged, at $750M vs. a year-ago $751M. The company announced a "strong" outlook for 2021, and according to estimates, core adjusted EBITDA should be around $23B.

"Our business is well-positioned for success in 2021 and, more importantly, beyond. From network to synergies, to operations and new investment areas, T-Mobile showed again this quarter that we're positioned to win," said Mike Sievert, President, and CEO of T-Mobile U.S.

T-Mobile U.S. expects a further increase of revenues this year while the cash from operations should be around $13B-$13.5B. The company has entered aggressively into the Home Internet segment, and it has plans to cover more than 50% of U.S. households within six years.

T-Mobile reported last week that it deployed Ultra Capacity 5G at the Miami Veterans Affairs Healthcare System, which is an exciting step towards the future of healthcare.

"T-Mobile's Ultra Capacity 5G brings healthcare providers the fastest 5G network of any provider, enabling them to deliver high-quality medical care. We are proud to be a long-standing partner of the V.A., and now the medical teams at the Miami VA Healthcare System can tap into 5G," said Mike Katz, EVP, T-Mobile for Business.

At the current valuation, much of the upside has already been included in the stock price, and maybe it is not the best moment to invest in T-Mobile U.S. shares.

Technical analysis: $100 represents a strong support level

The current support levels are $110 and $100; $130 and $140 represent the resistance levels. If the price jumps above $130, it would be a signal to trade shares, and the next target could be around $140, but if the price falls below the $100 support level, it would be a firm "sell" signal.

Summary

T-Mobile U.S. is a stable company that operates with a profit, but shares of this company have weakened more than 9% since the beginning of the year. T-Mobile U.S. reported that total revenue has increased by 71.2% in Q4 and announced that it expects a further increase in revenues. Technically looking, T-Mobile shares could advance again above $130 resistance, but the risk/reward ratio is not good enough for "value" investors.