(updated: prices refreshed)
NEW YORK/FRANKFURT (dpa-AFX) - After a very weak start to trading, shares of T-Mobile US rebounded sharply on Wednesday following the release of quarterly results and comments regarding the new year. This recovery also lifted shares of parent company Deutsche Telekom. While analysts noted some disappointment due to a forecast for free cash flow (FCF) that fell short of consensus expectations, their overall assessment remained positive.
Shortly after the US market opened, T-Mobile US shares dropped by nearly 6 percent, but quickly reversed course and at one point climbed to their highest level since early December. Most recently, the stock was up 2.3 percent at $204.06. Deutsche Telekom shares also experienced a rollercoaster ride. Later in the afternoon, they briefly hit their highest level since early September before closing up 0.6 percent at €30.37 in a somewhat weaker DAX.
Stock expert Frederik Altmann of Alpha Wertpapierhandel described the overall impression of the US subsidiary as slightly negative. While the forecast for operating profit (Ebitda) landed slightly above expectations at the midpoint of the guidance range, the FCF forecast was below. This temporarily put pressure on the share price.
Analyst Sebastiano Petti of JPMorgan highlighted that T-Mobile US's annual forecasts for Ebitda and FCF placed his own estimates at the upper end of the company's indicated ranges.
Overall, he described the results as mixed, but still called the stock "a Top Pick on JPMorgan's US Equity Analyst Focus List," indicating he sees it as particularly promising. Ebitda and FCF growth per share remain industry-leading. T-Mobile also has long-term opportunities for market share gains in the postpaid phone business in areas with low market penetration. He also emphasized the company's "robust multi-year capital return programs." /ck/err/he
