Markets

T-Mobile (TMUS) Dips More Than Broader Markets: What You Should Know

T-Mobile (TMUS) closed at $112.75 in the latest trading session, marking a -1.92% move from the prior day. This change lagged the S&P 500's 1.63% loss on the day. At the same time, the Dow lost 1.44%, and the tech-heavy Nasdaq lost 1.65%.

Heading into today, shares of the wireless carrier had gained 2.73% over the past month, lagging the Computer and Technology sector's gain of 5.81% and the S&P 500's gain of 2.86% in that time.

Wall Street will be looking for positivity from TMUS as it approaches its next earnings report date. This is expected to be November 5, 2020. In that report, analysts expect TMUS to post earnings of $0.54 per share. This would mark a year-over-year decline of 53.45%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $18.21 billion, up 64.61% from the year-ago period.

TMUS's full-year Zacks Consensus Estimates are calling for earnings of $1.91 per share and revenue of $68.20 billion. These results would represent year-over-year changes of -52.49% and +51.55%, respectively.

Investors might also notice recent changes to analyst estimates for TMUS. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has moved 0.62% higher. TMUS is currently a Zacks Rank #4 (Sell).

In terms of valuation, TMUS is currently trading at a Forward P/E ratio of 60.13. For comparison, its industry has an average Forward P/E of 26.71, which means TMUS is trading at a premium to the group.

Also, we should mention that TMUS has a PEG ratio of 4.57. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Wireless National stocks are, on average, holding a PEG ratio of 4.08 based on yesterday's closing prices.

The Wireless National industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 189, which puts it in the bottom 26% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow TMUS in the coming trading sessions, be sure to utilize Zacks.com.


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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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