Goldman Sachs Loves T-Mobile, Upgrades Stock To “Conviction List”

goldmansachs

Some good news for perspective T-Mobile USA investors as Goldman Sachs forecasts T-Mobile’s rebound in the subscriber segment of the market will continue. In fact, the company upgraded T-Mobile’s stock to its “conviction list,” a list of stocks the investment bank believes will outperform. T-Mobile’s stock is up about 75% since it began trading with MetroPCS on May 1st of this year. Goldman Sachs analyst Matthew Niknam, said he expects T-Mobile to hit around 500,000 new postpaid subscribers in the third quarter report set to be released on November 5th.

“We expect above-consensus postpaid growth and an increasing contribution from prepaid to fuel the top line,” wrote Niknam. “We now forecast a Street-high 500,000 postpaid net adds in Q3, and are at 1.51 million postpaid net adds for the year (vs. company guidance for 1 million and Street consensus of 1.2 million).”

Niknam does speculate that T-Mobile could be an acquisition target of a new entrant in the US, but believes a Sprint tie-up is unlikely in the short-term.

All of this positive analyst talk has us believing the “UnCarrier” strategy of no-contracts and lower-priced options is truly paying off and that the second quarter numbers were not just a one-time deal. It’s one thing to hear it from the company’s executive team, but a move to Goldman’s “conviction” list is a far cry from the T-Mobile of 18 months ago. That’s very good news indeed for all the Magenta fans out there.

Investors.com

 

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  • Binny Gupta

    With more money invested into tmobile better service. The more we use tmobile they build out more.

    • superg05

      that true some areas that where edge only now have hspda+ and lte keep up the good work

      • sahib102 .

        that is true! but not in my city but I am patiently waiting for the day when my phone goes from 2g to hspa :)

    • Aurizen

      Thats good I really hope they invest a lot in this low 700Mhz network and really get better in building penetration on HSPA+ and LTE

      • Alex Zapata

        Do you mean the upcoming 600MHz auction?

  • gadget_hero

    I wonder what international carrier wants into the US market? Vodafone is on its way out. Though it would be interesting as it would be pretty cheap for Vodafone with all that cash Verizon is paying them. Maybe a Korean carrier? I don’t think the US government would allow a Chinese carrier.

    • S. Ali

      Not sure DT would be willing to sell if T-Mobile starts becoming profitable. Who has the cash reserve to make a run? America Movil could make a run, they are already heavily invested in MVNO service. Vodaphone could go for it, but they would probably rather pay down their debts. I wouldn’t be surprised to see an Indian bid from Tata.

      • jay

        Calos Slim from Mexico could use his cash to open the US market. He already controls the Latin America market.

        • CARLOS ARROYO

          he already does, with Tracfone and telmex usa.

      • eanfoso

        Tata makes cars…

      • Jay J. Blanco

        Exactly T-Mobile produces alot of income for DT. If T-Mobile USA become even more profitable. DT will hold on to they share indefinitely.

  • http://twitter.com/SParKlngCyaNide SparklingCyanide

    Congratulations to Magenta! You’ve worked very hard to improve this year, and it shows to fans, competitors, and now investing firms. This is a huge turn around and I couldn’t be happier to be a longtime subscriber since 2000(VoiceStream days).

    • sorandkairi

      pfft… newcomer.. try powertel

      :)

      • http://twitter.com/SParKlngCyaNide SparklingCyanide

        well, I’m not old enough to be from Powertel. ; )

    • Trevnerdio

      Customer since ’99 sonnn (we left for 3 months, but quickly came running back to T-Mo because Nextel was super scary…)

  • JRT

    the “new entrant” could be “dish network”???

    • xmiro

      maybe. Vodafone made a lot of money with Verizon, they could buy T-mobile in one go with the money from the Verizon Wireless stake they got, and have access to the US wireless market. Carlos Slim is another potential suitor too.

      • http://pharaohtechblog.blogspot.com/ Conan Kudo (ニール・ゴンパ)

        Neither would be considered “new entrants”. Vodafone participated in the industry for almost 12 years. TracFone is owned by America Movil, Carlos Slim’s company.

        • UMA_Fan

          Well the Vodafone brand itself has never had a presence in the US. I don’t see Vodafone buying a partial stake in competitor’s DT joint venture but I could see them buying a majority of it and bringing the Vodafone brand to the US

      • ChitChatCat

        I have to imagine that part of the Vodaphone buyout was some type of lockout clause, but that can’t last forever.

  • TMoFan

    After years of cringing over the quarterly reports I’m excited to see UNcarrier on the upswing and being noticed as a force for change in the wireless industry. You can even see the UNcarrier effect in vzw’s recent report. Not huge but just the fact that it’s there shows a T-Mobile that’s reinvigorated!

  • sidekicker89

    Right after Verizon ADMITS that they raised the average bill for their customers!! John Legere even tweeted about it. I just tweeted him tonight letting him know AT&T plans on getting rid of Aio Wireless if their acquisition of Leap (Cricket) is approved! He tweeted back “Another one bites the dust”

    • Joe Hartley

      What I read was Aio was going to be merged with Cricket if the acquisition is approved. They would both be branded at Cricket to get Aio customers into more markets.

    • AndroidProfit

      John tweeted you…. DUUUUUUUUDE!

      • Christopher_McG

        He refuses to tweet back to me about the horrible data coverage in SW Las Vegas.

        • AndroidProfit

          Haha! The LTE coverage here in Atlanta is abysmal.

  • Chris

    I bought in at about 17 and sold around 23. Sucks for me!

  • KingCobra

    It will be interesting to see if DT still even wants out of the US market if T-Mobile continues to grow at this rate.

    • Jay J. Blanco

      I agree and wonder what will they say once the 3Q Report comes out.

    • Willie D

      They have a buyout option in the MetroPCS merging contract that TMobile can sell to anyone TMobile sees fit within 18 months of the close of the deal. Its possible but at this point unlikely.

  • jose

    I just don’t understand how my signal went from hspa+ most of the time. Now all I get is edge most of the time. I would only see edge maybe once a week for about hour.

    • Bigjavar101

      Your area may be in the process of being reframed but I would still contact T-mo to see what’s going on.

    • Trevnerdio

      My signal jumps from LTE to EGDE at my girlfriend’s house…but that’s only since LTE came along that HSPA+ got weaker.

    • Willie D

      During periods where TMobile is updating towers to move LTE to AWS spectrum, HSPA may experience intermittent outages or less than advertised speeds. HSPA is being not only moved to share spectrum within the AWS slots with LTE but also being deployed on PCS spectrum. While this is going on, it requires equipment, data cards and power to be taken offline, replaced, moved and rebooted. The process should take a few days to a week or two per site.
      During this time EDGE/GPRS is not affected because these networks already exist on spectrum bands in use and are not being taken offline in the immediate term.

      • jose

        Thanks for the info
        @willie D..

  • JJCommonSense

    What if Samsung were to buy TMO and bring us LTE-A…, wouldnt it b nice?

    • Alex Zapata

      TMO is already planning to deploy LTE-A.

  • chidino

    Goldman Sachs and the “conviction list”? Given Goldman’s involvement with the meltdown of 2008, I apologize if I thought that was something different. Perhaps they should rename that list.

  • Bud Fox

    Blue horseshoe loves anacott steel!

  • brenda223

    i love how tmobile is getting lte over here in los angeles fast its pretty much everywere in los angeles in east la,dwtwn la,montebello,pico rivera,alhambra ,boyle heights, lynwood,hollywood n wehollywood,glendale,compton,south central,long beach,santa monice ,san fernando valley i can go on with the list LOL i had lte on my g2 in all those places and many more places.. MY only complaint is that in the few places i have hspa when the phone displays “4G” i cant get data working at all!! its not my phone my man has tmobile iphone 5 and a friend xperia z from tmobile. Before hspa was fine but now even with full bars of regular 4G data dnt work i get webpage unavailable ,facebook app wont load ,picture messaging wont work.. and like i said i know many people with the same problem different phones same problem on hspa . does anyone know why ? its starting to piss me off . the 4G is there full bars but no data nada!! ugh.

    • calichik

      i agree im also in los angeles im on Lte 90 percent of the time but that 10 percent when i am on hspa f©ckk it never works half of the time even with full bars and when i finally do get it to work ugh slooow horrible ping its prettybad wth! i tought hspa was gonna be great as a backup but no! before lte happend hspa was fine why is it so bad now!?

      • PhoenixPath

        Those areas you are seeing HSPA+ not working are probably where LTE is being installed/refarmed. The process involves up to two weeks of crappy (read: little to no) HSPA+ coverage.

        • calichik

          hun trust me its being more than 2 weeks of hspa being bad more like 2 months like i said im on lte 90 percent of the time no problem there but when im on hspa forget it i cant even upload a pict to fb or do simple stuff like check email luckily calls go tru fine i never drop a call and calls always go tru at the first try ..

        • PhoenixPath

          It was just one idea of what could have been causing it. *shrug*

        • calichik

          thnks but like u said hopefully they do end up making them hspa towers lte because right now they be causing lots of problems hopefully they fix it soon!

  • Mike

    In Canada right now roaming on Rogers 3G and even with the speedcap, it is very good for email/Facebook and navigation. I have no problem streaming iHeartradio either without it constantly buffering. Very impressive. If only the EDGE was fixed :)

    • Lagurl89

      i agree speed is decent im in acapulco mexico right now heck im writting this right now from my tmobile lg g2 roaming via telcel 3G ,speed is fine for web browsing and facebook when i use the fb app it gets my location and says im in acapulco mx everytime i update my status so my friends be like gurl u aint in acapulco then i upload a pic n be all like yea i am LOL

  • JAY120

    And here everyone thought that the whole “Uncarrier” idea wouldn’t work.