UPDATE: BMO Capital Initiates Coverage On T-Mobile US

In a note released Tuesday morning, BMO Capital analyst Kevin Manning initiated coverage on T-Mobile US TMUS with an Outperform rating and a $40.00 price target.

Manning believes that T Mobile's continued subscriber growth, as well as its acquisition potential, outweigh concerns with the company. In terms of the deal with Sprint, Manning says there is a 60 percent chance the deal will go through, which is above the consensus expectations.

Shares of T-Mobile are down 1.15 percent Tuesday.