T-Mobile stock rating upgraded by KeyBanc on balanced risk/reward outlook

Investing.com - KeyBanc has upgraded T-Mobile US (NASDAQ:TMUS) from Underweight to Sector Weight, citing a neutral risk/reward profile at current trading levels. This assessment aligns with T-Mobile’s historically low price volatility, which InvestingPro data identifies as a key characteristic of the stock.

The research firm continues to see structural, cyclical, and company-specific challenges for T-Mobile, but believes these concerns are now adequately reflected in the stock’s valuation, with shares trading at less than 8 times KeyBanc’s 2027 adjusted EBITDA estimates. Currently, T-Mobile trades at a P/E ratio of 19.9 with an EBITDA of $32.56 billion for the last twelve months. InvestingPro’s Fair Value assessment suggests the stock is slightly undervalued at its current price of $206.63, with shares trading near their 52-week low of $199.41.

KeyBanc identifies T-Mobile’s fourth-quarter earnings report and the company’s 2026/2027 guidance as the next significant catalyst for the stock, where the firm expects T-Mobile to communicate an acceleration in organic growth rates following planned investments in 2025. With T-Mobile’s next earnings report due on February 4, 2026 (in 64 days), investors will be watching closely to see if the company can maintain its revenue growth trajectory, which stood at 7.3% in the last twelve months.

The analyst notes that while KeyBanc’s estimates remain modestly below consensus, leaving little room for error, market sentiment toward T-Mobile is already poor, suggesting limited downside risk from current levels.

KeyBanc also expressed the view that investor concerns about a resurgent Verizon appear overdone, contributing to the more balanced outlook for T-Mobile shares.

In other recent news, T-Mobile US reported strong third-quarter 2025 earnings, with results likely to outperform other U.S. and international mobile carriers, according to Benchmark. The company showed strong performance in phone subscriber additions and fixed wireless access (FWA) subscriber growth. Despite these results, TD Cowen lowered its price target for T-Mobile to $263 due to competitive concerns, although it maintained a Buy rating. Conversely, Tigress Financial Partners raised its price target to $310, citing growth through advanced AI initiatives and 5G network expansion. TD Cowen also reiterated its Buy rating and highlighted T-Mobile’s better-than-expected subscriber growth. Additionally, T-Mobile announced a partnership with CNN to enhance mobile journalism through the SuperMobile initiative, providing journalists with continuous connectivity for live reporting. Benchmark’s Matthew Harrigan maintained a Buy rating and a $295 price target, keeping T-Mobile as a "Benchmark Best Idea."

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.