Analysts and T-Mobile stock
According to data compiled by Reuters, as of September 27, 88% of the 25 analysts covering T-Mobile (TMUS) stock have given it a “buy” rating. The remaining 12% have given it a “hold,” and there were no “sell” recommendations.
T-Mobile stock has risen ~13% in the last 12 months and ~11% year-to-date. Analysts expect the stock to rise ~10.1% over the next 12 months. Their recommendations show a consensus 12-month target price of $77.61 compared to the stock’s price of $70.49 on September 27.
In the third quarter, Wall Street analysts expect T-Mobile’s adjusted EPS to rise ~34.9% YoY (year-over-year) to $0.85. They forecast T-Mobile’s revenue to grow ~7.2% YoY to $10.7 billion.
Forward PE valuation
A company’s PE ratio tells us the amount investors are willing to pay per dollar of EPS. T-Mobile is currently trading at a PE multiple of ~24.5x, which is higher than Verizon’s (VZ) and AT&T’s (T) at ~15.6x and ~18.0x, respectively.
T-Mobile’s forward PE ratio for fiscal 2018 is ~21.9x and estimated at ~17.7x for fiscal 2019. In comparison, AT&T and Verizon have forward PE ratios of ~9.5x and ~11.5x, respectively, in their current fiscal years.