T-Mobile US Inc (NASDAQ:TMUS) soared Monday after it reported a strong set of numbers for the third quarter, boosted by the addition of 2 million new customers. It also got some tailwind from speculation that it could be a candidate in an M&A transaction after competitor AT&T snapped up Time Warner.
The TMUS stock shot up an impressive 9.5% to close Monday at $51.19, after trading 21.18 million shares.
What’s interesting is that the stock had been shaping up for a breakout after it formed a saucer on the daily chart between early August and now.
T-Mobile US Inc (NASDAQ:TMUS) and its Q3 report
In the third quarter TMUS kept up its relentless streak (now 14 quarters) of adding a million+ subscribers. It reported EPS of $0.27 which beat by $0.04, and revenue of $9.20 billion which was up 17.2% but missed expectations by $220 million.
Calling itself the fastest growing wireless company in America, it added 851,000 branded postpaid phone net adds, the most in the industry for the 11th straight quarter.
It revised its outlook for 2016 and said it now expected branded postpaid net adds in the range 3.7 to 3.9 million from 3.4 to 3.8 million.
It raised its adjusted EBITDA target to $10.2 – $10.4 billion from $9.8 – $10.1 billion.
“We took share and grew our customer base while producing both financial growth and shareholder value,” said John Legere, President and CEO of T-Mobile. “Most importantly, we are delivering results for both customers and shareholders alike.”
Shareholders will likely agree – the TMUS stock scaled a nine-year high on Monday.
Could T-Mobile US Inc (NASDAQ:TMUS) be a target?
Shareholders of TMUS may also be licking their chops on the possibility of the company becoming deal material – there is speculation swirling that Comcast could speed up its push into wireless, perhaps by acquiring T-Mobile in partnership with Charter Communications.
In fact, Legere has often said that video is going mobile and mobile is going video.
But the AT&T-Time Warner deal could have a bonus on the side for TMUS.
“I would say the great news is (AT&T is) going to be further unfocused than they are now and the upside opportunity to continue to acquire businesses in the space for us is tremendous,” Legere said.