T-Mobile US Inc (NYSE:TMUS) — This wireless provider extended its disruptive “Uncarrier” campaign to its business customers in March, offering a simplified pricing plan for clients looking to bundle a large number of lines. This should help the company grow its small- and medium-size business customers, where price is more of a factor than with large companies.
On April 28, T-Mobile reported better-than-expected sales and earnings for the first quarter and the addition of 1.8 million net customers.
Following the release, S&P Capital IQ revised its full-year estimates upward. Its analysts now expect 2015 operating earnings of $0.94 per share, up from $0.91, and raised their 2016 estimate to $1.92 per share from $1.66. They also upped their 12-month price objective on TMUS stock by $1 to $35, saying they anticipate T-Mobile will take further market share from its wireless peers as the company focuses on improving its 4G network.
Credit Suisse Group AG (ADR) (NYSE:CS) has highlighted TMUS stock as its top pick for 2015 in the telecom sector. Its analysts have an “outperform” rating on shares and a $39 price target.
Technically TMUS stock is trading above its 20-day, 50-day and 200-day moving averages. Shares advanced more than 7% in April and are up nearly 27% for the year.
Positive technical signals abound. A golden cross occurred in March, and TMUS stock broke from a rectangle (a positive consolidation) at $33 in April. It is currently consolidating in a small diamond with a midpoint at $34.
Buy TMUS stock under $33.50 with a trading target of $39 for a 16% return. A stop-loss order should be placed below $32. This telecommunications stock should also be considered as a long-term holding by investors.
