The dividend champion is a company that has increased its dividend for 25 consecutive years.
The T-Mobile occupies a growing share of its industry and produces increasing free cash flows.
The strong capital return program is currently focused on sharing repurchase, but it may change.
10 shares we like better than T-Mobile US ›
For many, the biggest investment is a company that can constantly increase its dividends year after year. However, established dividend payers can often give shareholders nominal lifts to alive their annual dividend sections. An additional penny for one campaign does not intend to move the needle for most investors each quarter.
The true value of the dividend growth investors is to find a company that is moving forward to give its shareholders a high salary for the coming year. This period usually occurs well before the company becomes a dividend champion – shares that increase dividends by 25 straight. Once you have found a high financial stability and to repay the capital early, you can give a double -digit increase in dividends for the coming year.
The telecommunications industry is full of large dividend payers such as Verizon Communications and AT&T; Both have long sections of their dividend cultivation. AT&T once held a 36 -year stretch until 2022. Reduced dividends during restructuring. Verizon has an active 18 -year -old stretch and is likely to do 19 years this year. But another telecommunications player only in 2023. Began to pay dividends, and it seems to have a long increase in dividends in front of him.
That’s why dividend growth investors should take a closer look T-Mobile(Nasdaq: TMUS);
Image Source: Getty Images.
T-Mobile appeared to be as a “non-wicker” as a decade ago, sold as a more friendly customers than AT&T or Verizon. Great marketing, low prices and constant investments in their network have led to strong customer additions during 2010. In the middle- at the end.
Today, the T-Mobile is far from the subgroup. 2020 The merger with Sprint left a huge portfolio of wireless licenses, which gave a huge leg to accumulate its 5G network. He did not spend the opportunity, and the T-Mobile 5G network has better coverage and speed than its competitors. It is also used in excess capacity of your network to offer customers home internet services using fixed local models, competing with both AT&T and Verizon, as well as traditional Internet service providers.
As a result, the T-Mobile is no longer valid for its customer service and prices. This was clearly stated in the latest income report. T-Mobile added 830,000 delayed phone customers, the best in the second quarter result in history. Common customers (for any connected device) increased by $ 1.7 million. By comparison, AT&T added 401,000 delayed payment phone subscribers and Verizon lost 51,000.
And what makes those subscribers ‘T-Mobile’ is that the average increase in income per consumer-3.2% deferred payment for phone customers. The average one account income has increased by more than 5%, indicating that T-Mobile successfully sells additional services to its customers, such as home online.
In fact, the T-Mobile home online service has increased to 7.3 million, properly coordinating the purpose of management-this year’s $ 7 million. Up to 8 million Subscribers set out in 2021; By adding fiber assets from the acquisition of Luma, T-Mobile sets its approach to $ 12 million. Subscribers by 2028.
The company also recently closed USCellular acquisition and added 4 million plus phone subscribers to its main position. If he follows the same game book as the purchase of Sprint customers, it should be able to improve maintenance while increasing the prices of those subscribers. T-Mobile also acquires access to the USCellular spectrum licenses, giving it more assets to create its own main network.
Despite the intense competition between AT&T and Verizon, T-Mobile shows a very good financial force. This should eventually turn into significant dividends of the company.
Currently, the T-Mobile shares receive only 1.5%based on the last four quarter-dividend payments. However, after 2023 September Initiated dividends and announcing their first September last year, investors should expect another dividend march in September this year. There is plenty of space to increase dividends.
T-Mobile is already committed to receiving a considerable amount of capital returns. The leadership hopes that from 2024 By the end of 2027 The cumulative return on capital will be around $ 50 billion. This number may rise above as he expects to spend an additional $ 20 billion on acquisitions and capital investment opportunities.
But so far, the vast majority of these capital returns have been done through the redemption of shares. T-Mobile paid about $ 1 billion in dividends last quarter, but bought $ 2.5 billion. However, focusing on the redemption of shares today will allow for higher dividend yields in the future, as T-Mobile will allocate its total dividend payment from less shares.
When 2023 T-Mobile initiated its dividends, she said she plans to increase dividends by about 10% per year. Last year, shareholders increased by 35%. Another super -sized raising is not a question, as in the first 2025 In the first half of the year, free cash flows increased by 15.5%. It said that the management expects only small free cash flow improvement from here, growing from $ 18 billion to $ 19 billion in 2027, from $ 17.8 billion in the middle of 2025 instructions in the middle.
However, T-Mobile has cash flow to maintain a growing dividend, and its position in the telecommunications industry is only intensified. Given that a small amount of cash is currently paid as a dividend, there are many opportunities to increase the benefit ratio and maintain dividend hikes in the coming year. Although it is impossible to predict 23 years into the future, it can be safely stated that dividend growth investors can find a lot that today may appeal to T-Mobile shares.
Before buying T-Mobile US shares, consider this:
Motley Fool Stock Advisor A team of analysts just found what they think is 10 best stocks To buy investors now … and T-Mobile was not one of them in the US. 10 stocks that reduced the incision can return the monster in the coming years.
Consider when Netflix This list consisted of 2004. December 17th … If you have invested $ 1,000 during our recommendation, at our recommendation, You would have $ 619,036!* Or when Nvidia Made this list in 2005. April 15 … If you have invested $ 1,000 during our recommendation, at our recommendation, You should have $ 1,092 648!*
Now it is worth mentioning Share advisor The average return is 1 026%-S&P 500, compared to 180 percent. Share advisor;
See. 10 stocks »
*The stock advisor returns from 2025. August 4
Adam Levy has no position in any of the above shares. Motley fool recommends T-Mobile US and Verizon Communications. The Motley fool has a disclosure policy.
This company looks like a dividend champion that could announce another dividend march next month, initially announced by The Motley Fool
