February 16th- T Mobile



March 19 Call, $135  Strike, $1.01

T-Mobile, the second largest wireless carrier, reported earnings on February 4th, continuing its strong growth story. T-Mobile story is similar to the semiconductor story, where Nvidia and AMD took business from Intel, leading to their outstanding growth. T-Mobile is taking customers from seemingly all carriers by their forward thinking 5G roll out outperforming it rivals, taking business from A&T, Verizon and others. The stock has been weak since earnings due to lack of guidance and flat net income. Here are some key results from the earnings release:

-Net customer additions were 1.7m in Q4 2020, the 24th consecutive quarter of industry leading in this category

-Invested to be the Largest 5G network in America is now the fastest- 300 Mbps and peak speeds up to 1 Gbps on compatible 5G devices, as they pledged billions to investments in towers and other 5G enabling connectivity

-Net income was flat year over year, due to investment in infrastructure and Sprint merger costs

-2020 Revenue 68.3B vs 2019 Revenue 44.9B (+23B)

-Simplified plans  with a"un-carrier" model to compete with AT&T, subsidizing phones, limiting fees, early termination charges, which will make them harder for other providers to compete

-T-Mobile's 5G network now has nearly two and half times the coverage of AT&T's 5G network and nearly four times the coverage of Verizon's 5G network

-T Mobile's 5G network now has nearly two and half times the coverage of AT&T 5G network and almost four times the coverage of Verizon's 5G network

-With approved stimulus, this could be a driver to the upside as well


Technical Analysis: Friday, 2/12, TMUS hit $123.30 price has been supported two other times in last 30 days, strongly bouncing up. At Friday day end, a large buy came in at day end and I expect this to be a bottoming.