T-Mobile US' Lower Churn Likely To Drive Future Performance: Analyst

Citi analyst Michael Rollins reiterated a Buy rating on T-Mobile US, Inc TMUS and raised the price target from $172 to $174.
The analyst updated his outlook for T-Mobile following the pre-released 4Q KPIs during Citi’s 2023 CME Conference.
The more significant reduction in 4Q churn could be a prelude to better churn rates in the future.
Rollins believes the completed network integration and ongoing reduction of leased devices can lead to further improvements in churn during 2023 over 2022.
A lower churn outcome can help improve annual postpaid phone growth, reduce acquisition costs (and improve EBITDA), or combine these potential benefits.
The analyst believes T-Mobile can sustain favorable revenue growth (relative to the industry) in 2023 while improving margins and repurchasing a significant percentage of its shares.
Rollins remains a buyer of T-Mobile as a top-ranked pick, incorporating some moderation rates and an updated multi-year financial outlook.
Price Action: TMUS shares traded lower by 0.10% at $145.00 on the last check Friday.

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