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T-Mobile US (TMUS) stock forecast: how far will it go in the 5G race?

By Payel Bera

Edited by Vanessa Kintu

07:16, 10 February 2022

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Bellevue, Washington / USA - January 3 2019: Tiered exterior of the T Mobile headquarters building at night, with exterior magenta lights, and space for text on the bottom
T-Mobile US (TMUS) stock forecast: how far will it go in the 5G race? – Photo: Shutterstock

With the successful acquisition of Sprint in 2020 bringing in nearly 64% more customers, the T-Mobile US (TMUS) network grew in 2021. The wireless carrier’s shares hit an all-time high of $149.41 on 12 July. Now, with its 5G reach expanding across the US, T-Mobile US seems well set to battle in the highly competitive US telecoms market.

What will T-Mobile US do to compete in a fiercely competitive market?  Will it lead the 5G boom? Let’s look at T-Mobile stock prediction for 2022 and beyond.

What is T-Mobile US?

Founded in 1994, T-Mobile US is an American national wireless service provider that offers services through T-Mobile, Metro by T-Mobile and Sprint. As of 2021, the company had 5.5 million postpaid net adds. Core adjusted EBIDTA touched a record high of $23.6bn, exceeding T-Mobile’s guidance for the financial year.

Along with deploying 5G and 4G Long-Term Evolution (LTE) networks across all US states, T-Mobile aims to provide cheaper rates and uncomplicated terms and conditions to enhance customer satisfaction. The business focus is on its “Un-carrier Value Proposition”.

By the end of 2021, T-Mobile’s Ultra Capacity 5G covered 210 million customers across the US. Extended Range 5G covered 94% of the population. Joining forces with Sprint enables TMUS to access 14 times more network capacity in the next six years than T‑Mobile could offer alone. 

T-Mobile US is currently listed on the Nasdaq, with a market cap of $156.701bn. The stock closed at $125.465 on 8 February 2022. 

TMUS 5-year stock price chart

T-Mobile news

T-Mobile news plays a role in share price movement, so let’s have a glance at what has happened or is about to in the recent past. 

On 31 January 2022, T-Mobile announced that it had invested almost $3bn in the Federal Communications Commission’s Auction 110. This secured an additional mid-band spectrum for the company allowing it to boost its leading Ultra Capacity 5G network. The company now has an average of 21 MHz of mid-band spectrum in key areas with the capacity to reach 184 million people across the US. TMUS will deploy it to add depth to its Ultra Capacity 5G.

Developments in the 5G arena always cause headlines as T-Mobile continues to provide fuel for growth in disruptive technology. Its 5G technology is helping companies like driverless, electric vehicle Halo take a pragmatic approach to tackling transportation challenges. This graduate of the 5G Open Innovation Lab co-founded by T-Mobile served as the official pace car in the first high-speed, head-to-head autonomous racecar competition at the Las Vegas Motor Speedway. 

To expand its 5G connectivity and accessibility, the company signed a new 12-year agreement with Crown Castle International on 6 January. This will allow increased access to Crown Castle’s towers and small cell locations.

To provide customers with a safer mode of communication T-Mobile partnered with CTIA to develop best practises for new enhanced Caller ID for businesses. On 18 January, the company announced that to protect consumers from scammers and unwanted robocalls it will deliver verified calls that include an easily recognisable Caller ID display. The process combines authenticated Caller ID, STIR/SHAKEN and Rich Call Data (RCD).

At the beginning of this year, T-Mobile also announced that it has 1.8 million postpaid net customer additions and 5.5 million postpaid net customer additions in 2021, not only topping its record but also taking an unrivalled lead with America’s only standalone 5G network.

T-Mobile is also joining the global transition in sustainable energy. On 31 January, the company reported that it has achieved its plan to source 100% of its total electricity usage from renewable energy by the end of 2021. T-Mobile USE CEO Mike Sievert stated in an interview: 

“The Un-carrier is powering America’s largest, fastest and most reliable 5G network with 100% clean electricity.” 

The company has made solid investments in wind and solar power. Currently, nine large wind and solar farm projects are providing T-Mobile with approximately 3.4 million megawatt hours (MWh) of clean energy annually alone. On top of it, T-Mobile's energy matching efforts are supporting 37 community solar projects with more than 2.1 million MWh across Maine, Massachusetts, Minnesota, New York and Oregon.

TMUS price analysis 

Before diving into T-Mobile stock forecast, we need to study the company’s financials, fundamentals and analyse past performance.

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A sneak peek into T-Mobile’s fourth-quarter 2021 earnings results suggests that reports were mixed. While the wireless carrier witnessed record postpaid account and postpaid customer net additions in 2021, there was a decline in net income. Net income came in at $422m or 34 cents a share compared with $750m or 60 cents a share in the same quarter a year earlier, due to a planned increase in merger-related costs. 

However, revenues inched up 2.2% year-over-year to $20.7bn, strongly driven by customer growth. In the earnings call, Sievert set guidance for 2022, stating that he aspires to continue T-Mobiles’ leading postpaid growth, achieve 10% in core adjusted earnings before interest, tax, depreciation and amortisation (EBITDA), and over 30% growth in free cash flow.

Moving into T-Mobile stock analysis, the share price is down 0.5% in the last 12-month period and 11.8% in the past six months, despite hitting an all-time high of $149.41 on 12 July 2021. 

So, is T-Mobile stock buy, sell or hold? Let’s look into some T-Mobile stock projections.

T-Mobile US price forecast: what are experts saying?

Analysis of popular technical indicators can help to forecast stock price movements. According to TradingView, for one month, 13 indicators point to ‘buy’ and two to a  ‘sell’. The momentum (10) and all the simple and exponential moving averages, except the 10 weeks simple moving average, suggest a ‘buy’. The Relative Strength Index (RSI) remains neutral.

WallStreetZen sets a T-Mobile stock price target at $171.25 for the next 12 months. Let’s consider some other T-Mobile stock price projections.

Wallet Investor forecasts the price to hit $140.745 by the end of this year. While analysts do not provide a forecast for 2030, they do predict TMUS’s trajectory in 2023, 2024 and 2025, which is expected to reach $164.486, $188.248 and $211.974, respectively. By 2027, T-Mobile the service expects the price  to reach $240.733.

Gov Capital estimates T-Mobile to hit $156.154 by the end of this year, followed by $251.262 in 2023, $359.244 in 2024 and $509.283 by 2025.

Based on 20 analysts’ ratings, Market Beat has set T-Mobile’s target price at $161.76 by 2 September. Analyst Raymond James rates the stock a ‘strong buy’. The Goldman Sachs Group, HSBC, Nomura Securities, SunTrust Banks, Nomura Instinet, Argus, Citigroup, Bank of America, Sanford C. Bernstein, JPMorgan Chase & Co., Barclays, Benchmark, Societe Generale, DZ Bank, Truist Financial, Credit Suisse Group, Loop Capital and Deutsche Bank Aktiengesellschaft all pitch the stock as a ‘buy’. 

Investors should know that these algorithms are based on the company’s past performance and historical data. You should exert caution when making investment decisions based on such predictions. Forecasts and models can change from time to time. They are affected by changes in market dynamics, macro-economic factors and the company’s portfolio expansion. Past performance is no guarantee for future success. 

Always do your own research before investing. The decision to trade depends on your attitude to risk, expertise in the market, and how comfortable you feel about losing money. You should never invest more than you can afford to lose.

FAQs

Is T-Mobile stock a good buy?

According to analysts’ ratings and T-Mobile’s current stock trend, it could be  a good investment. However, concerns remain regarding the company’s strategy to counter intense  industry competition and profitability has weighed on prices.

Will T-Mobile stock go up or down?

Forecasts provided by Wallet Investor, Gov Capital and MarketBeat suggest that the wireless carrier is poised to grow. T-Mobile could  reach $140.745 by the end of this year and reach $240.733 in the next five years.

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