Here's How T-Mobile's 'Emerging Catalysts' Led To An Upgrade At Citigroup

In a report published Wednesday, Citigroup analyst Michael Rollins detailed his meeting with T-Mobile US Inc (NYSE: TMUS) management team, including its Chief Financial Officer Braxton Carter and Executive Vice President of Corporate Strategy Peter Ewens."We believe T-Mobile is retaining favorable traction to take postpaid share within urban markets from its Un-carrier value proposition while the company is digesting an elevated mix of sub-prime customers better than what we previously anticipated," Rollins wrote. "Management indicated porting ratios are up early in first quarter 2015 and we believe T-Mobile can outperform the high-end of its net add guidance with our upwardly revised estimate of 3.7 million with 1.1 million estimated for the first quarter."Rollins noted that his meeting revealed emerging catalysts that can yield "favorable" revenue and OIBDA (Operating Income Before Depreciation And Amortization) for 2016 relative to consensus. These catalysts include expanding its addressable market, retaining positive operating leverage and capturing the remaining MetroPCS synergies through 2016.Rollins also added that T-Mobile can be a potential strategic partner to "multiple companies in multiple forms" over the next one to two years given its operational performance, improved network capability and financial capacity.Shares were upgraded to Buy from Neutral/High Risk with a price target raised to $40 from a previous $37.