T-Mobile US (TMUS) Stock Forecast & Price Target

T-Mobile US has demonstrated a robust financial performance, highlighted by a significant increase in Return on Capital (ROC) from 6.40% to 6.91% over the last twelve months (LTM), alongside a 27.86% year-over-year increase in Economic Profit, which rose from $1.17 billion to $1.49 billion. The company's Net Sales Revenue increased by 7.30% year-over-year, climbing from $80.01 billion to $85.85 billion, with forecasts indicating a further increase to 7.98% over the next twelve months (NTM). Additionally, the firm achieved a best-in-industry growth of 12% year-over-year in postpaid services revenue, reaching $14.9 billion, and a considerable 34% year-over-year growth in broadband net additions, underscoring its leadership in high-speed connectivity.

T-Mobile US is currently trading at 9.9x FY26E EV/EBITDA, reflecting its lowest valuation in over a year, while facing unexpected weaknesses in prepaid and wholesale revenue. The company is structurally challenged in a competitive environment, particularly due to its insufficient investments in fiber infrastructure, which limits its ability to compete effectively against peers. Additionally, there are risks related to revenue and cash flow generation, including potential shortfalls driven by economic factors, competitive pressures, and merger-related expenses, heightening concerns over future earnings and free cash flow guidance.