The shares of T-Mobile US Inc., which is the fourth-largest mobile carrier in the U.S., rose the most in at least five months due to the stable first-quarter customer growth of the company, which managed to add more subscribers compared to its rivals Verizon Communications Inc. and AT&T Inc. The performance of T-Mobile is considered as a result of its more aggressive marketing strategy, including cheaper plans and promotions.
The company made an official statement revealing its customer growth and sharing its expectations for the rest of the financial year.
Mr. John Legere, Chief Executive Officer of T-Mobile Inc., said in the company’s statement, which was cited by the Wall Street Journal: “We are very pleased with the kinds of competition were able to put to the big guys and consolidation is one way that we know we could continue to put it aggressively to them over time.”
As reported by Bloomberg, Mr. Legere also said: “A year ago I promised that we would bring change to what I called this arrogant U.S. wireless industry. We are delivering on that promise and our results reflect the growing customer revolution that we’ve ignited.”
T-Mobile US Inc. managed to add 1.3 million new wireless subscribers over the first quarter of the current financial year. This result not only beat the analysts’ forecasts of 998 000 customers, but also surpassed the combined results of AT&T and Verizon, which amounts to 1.16 million customers. The company forecast adding 2.8 to 3.3 million branded contract customers by the end of 2014.
The promotion plan of T-Mobile is believed to have significantly influenced on its first-quarter customer growth, because it includes paying cancellation fees for new customers. The company posted a 151-million-dollar loss for the first three months of the financial year in comparison to a 107-million-dollar profit posted for the same period in 2013.
The founder of MoffettNathanson LLC – Mr. Craig Moffett, commented the company’s performance in a note, which was cited by Bloomberg: “T-Mobile’s current subscriber momentum is undeniable. Competitively, the change is mind-boggling.”
T-Mobile US Inc. added 8.06% to close at 31.65 dollars per share in New York yesterday, marking a one-year change of +91.59%. According to CNN Money, the 19 analysts offering 12-month price forecasts for T-Mobile US Inc have a median target of $35.00, with a high estimate of $42.00 and a low estimate of $12.00. The median estimate represents a +10.58% increase from the last price of $31.65. The company is valued at $25.41 billion.
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