T-Mobile Reaffirms Growth Targets Amid Escalating Competitive Pressures

What happened

T-Mobile's recent 2026 guidance projects a 10% year-over-year increase in core adjusted EBITDA and stable capital expenditures, as highlighted in a Seeking Alpha article emphasizing strong customer metrics and top-line growth. The company reports robust postpaid ARPU and broadband customer additions, signaling resilient core business momentum. However, the DeepValue master report reveals that these gains are undercut by rising churn, which climbed to 0.93% in 2025 due to increased industry switching and promotional activity. Filings show postpaid ARPA growth faces offsets from promotional dilution, and the UScellular integration brings substantial, hard-to-estimate expenses along with higher-churning acquired accounts. Despite the optimistic guidance, underlying cost control challenges and competitive intensity threaten margin targets and the multi-year financial bridge.

Implication

T-Mobile's guidance supports a bullish narrative, but the stock's valuation at ~21x P/E and ~20x EV/EBITDA offers limited downside protection if operational risks materialize. The company must execute its pivot away from device-heavy promotions to achieve the 2.5-3.0% ARPA growth target without further churn increases, which filings already show as a challenge. Integration of UScellular requires precise management to capture $1.2B synergies and avoid cost overruns that could impair EBITDA targets. Near-term catalysts, such as Q2 2026 churn data and Live Translation beta metrics, will be critical to validate the thesis and justify current prices. Given the 'WAIT' rating and attractive entry at $190, investors are better off waiting for clearer evidence of margin defense and integration progress before increasing exposure.

Thesis delta

The Seeking Alpha article reinforces T-Mobile's growth outlook but does not change the core investment thesis, which remains that execution risks in a competitive environment warrant caution. No material shift is indicated; the thesis still hinges on the company's ability to stabilize churn and deliver on integration synergies. Investors should continue to monitor upcoming quarterly results for confirmation of these key drivers.