Wells Fargo downgraded T-Mobile (TMUS) to Equal Weight from Overweight with a price target of $220, down from $240. With EBITDA and free cash flow growth rates decelerating, and T-Mobile’s relative premium well above historical levels, the firm thinks the risk/reward is less favorable looking into 2025. Furthermore, while Wells expects T-Mobile will still have “best in class” growth across subs and EBITDA the next 3 years, a more than 50% relative premium to AT&T (T/)Verizon (VZ) on EV/EBITDA is tough for the firm to justify with T-Mobile growth rates decelerating into 2025.
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