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T-Mobile (TMUS) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
·3 mins read

In the latest trading session, T-Mobile (TMUS) closed at $113.52, marking a -0.63% move from the previous day. This change lagged the S&P 500's daily loss of 0.48%. Meanwhile, the Dow lost 0.48%, and the Nasdaq, a tech-heavy index, lost 0.29%.

Prior to today's trading, shares of the wireless carrier had lost 2.09% over the past month. This has was narrower than the Computer and Technology sector's loss of 5.56% and the S&P 500's loss of 4.3% in that time.

TMUS will be looking to display strength as it nears its next earnings release. On that day, TMUS is projected to report earnings of $0.57 per share, which would represent a year-over-year decline of 50.86%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $18.21 billion, up 64.65% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $1.91 per share and revenue of $67.75 billion. These totals would mark changes of -52.49% and +50.57%, respectively, from last year.

It is also important to note the recent changes to analyst estimates for TMUS. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 2.63% higher within the past month. TMUS currently has a Zacks Rank of #3 (Hold).

In terms of valuation, TMUS is currently trading at a Forward P/E ratio of 59.75. This valuation marks a premium compared to its industry's average Forward P/E of 24.28.

It is also worth noting that TMUS currently has a PEG ratio of 4.85. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. Wireless National stocks are, on average, holding a PEG ratio of 4.22 based on yesterday's closing prices.

The Wireless National industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 122, putting it in the top 49% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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TMobile US, Inc. (TMUS) : Free Stock Analysis Report
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