About to Buy T-Mobile US, Inc. (TMUS)? Look at These Metrics First

Analysts at Guggenheim, assumed coverage of T-Mobile US, Inc. (NASDAQ:TMUS) with Buy recommendation, according to their opinion released on November 01. Wells Fargo analysts bumped their recommendation on TMUS stock from Market Perform to Outperform in a separate flash note to investors on June 28.

In the period that ended November 15, 2018, short interest in T-Mobile US, Inc. (NASDAQ:TMUS) stock is on the rise. The 6.98% advance could be an indication that investors and traders expect a deterioration in the stock price, often as a result of a deterioration in the business’ fundamentals. The average analyst recommendations at 1.7 suggests selling these shares. Between October 31 and November 15, the total number of shorted shares amounted to 8.74 million shares. That was 570,242 more shares than the total of 8.17 million shares in the space of prior two weeks, which means more traders or funds betting that the stock will go down. Average daily volume for TMUS at the November 15th settlement plunged to 3,186,217, as compared to 4,841,350 at the October 31st report. That brought days to cover to 2.742067, a 62.56% increase from the 1.686839 days to cover recorded at the prior short interest data release.

By watching the trading activity of corporate insiders, it will become easier to get a sense of T-Mobile US, Inc. (NASDAQ:TMUS)’s prospects. The earliest insider trade took place on 11/07/2018. Carey David R parted with a total of 2 thousand shares of company at average share price of $70.01. The total for the sales was set at $140.02 thousand. After this transaction, the EVP, Corporate Services account balance stood at 244.6 thousand shares. The stock lost -3.87 percent since that insider sale. On 11/07/2018, Keys Thomas Christopher, Pres. MetroPCS, sold 50 thousand shares at a price per share of $70.23. This removed 3.51 million shares from the insider’s fortune and the stock saw a -4.17 percent retreat in value since the news became public. This transaction left 291.88 thousand shares in the Pres. MetroPCS account. On 11/06/2018, President & COO Sievert G Michael performed a sale transaction worth $704.06 thousand. This sale at $69.08 each has eliminated 10.19 thousand shares from the insider’s portfolio position. Meanwhile, shares have recorded -2.58 percent decrease since the transaction was reported. The insider now is left with 436.96 thousand shares remaining in the account. Carey David R, who performs the EVP, Corporate Services job, sold 2 thousand shares for $141.14 thousand. The disposal occurred on 10/01/2018 was priced at $70.57 per share. The share price plunged -4.63 percent since the reporting date. Carey David R now left with a stake of 246.6 thousand TMUS stock worth $16.6 million after the insider selling.

T-Mobile US, Inc. (TMUS) is expected to jump by 16.17 percent over the next 12 months, according to price target estimates compiled by finviz. Meanwhile, they have set a $90-month high price target. This represents a whopping 33.73 percent increase from where shares are trading today. The 12-month median price target assigned by the analysts stands at $80, which represents a return potential of 18.87 percent when compared to the closing price of the stock of $67.3 on Thursday, December 06. The lowest price target for the stock is $70 — slightly more than 4.01 percent from TMUS’s current share price.

The shares are currently floating around the first support level of $65.7. Below this, the next support is placed in the zone of $64.09. Till the time, the TMUS stock trades above this level, bulls have nothing to fear. On momentum oscillators front, ‘RSI’ has touched 46.6 on daily chart, which may remain a cause for concern. If the price breaks below $64.09 level on closing basis, then we may see more profit booking and the stock may show further weakness. On the flipside, hitting the $68.23 mark may result into a pull-back move towards $69.15 level.

TMUS shares accumulated 0.73 points or 1.1 percent on Thursday to $67.3 with a heavy trade volume of 4.883 million shares. After opening the session at $65.68, the shares went as high as $67.55 and as low as $65.02, the range within which the stock’s price traded throughout the day. The firm is left with a market cap of $57.3 billion and now has 851.24 million shares outstanding. T-Mobile US, Inc. (TMUS) stock has lost -2.31 percent of market value in 21 trading days.

TMUS stock has a trailing 3-year beta of 0.43, offering the possibility of a lower rate of return, but also posing less risk. The portion of a company’s profit allocated to each outstanding share of common stock was $3.2 a share in the trailing twelve months. The stock’s value has surged 5.97 percent year to date (YTD) against a rise of 10.4 percent in 12 month’s time. The company’s shares still trade -5.13 percent away from its 1-year high of $70.94 and 22.16 percent up from 52-week low of $55.09. The average consensus rating on the company is 1.7, on a scale where 5 equates to a unanimous sell rating. In short, the mean analyst recommendations are calling this stock a buy.

Shares of T-Mobile US, Inc. (TMUS) are trading at a P/E ratio of 21.12 times earnings reported for the past 12 months. The industry TMUS operates in has an average P/E of 14.19. Its P/E ratio went as low as 24.24X and as high as 650.55 over the 5-year span. Further, it is sporting a 1.34 on the Price-to-Sales ratio. Compare this with the industry average P/S of 1.31. 57.2 percent is the gross profit margin for T-Mobile US, Inc. and operating margin sits at 12.4 percent. Along with this, the net profit margin is 11.6 percent.

TMUS will be showing off its Q4 earnings on February 09. Analysts are forecasting revenue to climb 5.5 percent to $11.4B in the next fiscal quarter, while earnings are seen soaring by nearly 14.75 percent to $0.7 per share. History has shown that shares in T-Mobile US, Inc. have gone up on 14 different earnings reaction days and are predicted to add 0.03 percent when the company reports upcoming earnings. In last reported earnings results, it earned $0.93 per share, better than the $0.85, adjusted, expected by Thomson Reuters consensus estimate. Revenue was $10.8B, better than the $10.7B analysts expected. Earnings are estimated to increase by 55.3 percent this year, 21.81 percent next year and continue to increase by -3.1 percent annually for the next 5 years.