Using an unlevered Free Cash Flow to Firm (FCFF) model, we project T-Mobile US, Inc.'s cash flows over 5 years with line-by-line expense modeling. Revenue is projected revenue growing from 7.1% to 3.5% annually, with expenses (COGS, SG&A, R&D) held at historical ratios. Depreciation is computed from a vintage matrix based on a 5-year useful life. Working capital is modeled using historical turnover days (DSO 41, DPO 55, DIO 21). At a 6.8% WACC with mid-year discounting, the terminal value (74% of enterprise value) is derived by applying the industry peer median EV/EBITDA multiple of 7.5x to Year 6 EBITDA. After subtracting net debt, the equity value implies a fair price of $219.09 per share, suggesting TMUS is fairly valued by 3.4% at the current price of $211.95.
Adjust parameters to explore scenarios. Changes are for exploration only and do not affect saved valuations.
| 2026 | 2027 | 2028 | 2029 | 2030 | Terminal | |
|---|---|---|---|---|---|---|
| Profit Before Tax | 24,461 | 25,553 | 26,602 | 27,546 | 28,500 | 29,213 |
| (−) Net Interest | 3,938 | 4,113 | 4,282 | 4,434 | 4,588 | 4,703 |
| (+) D&A | 14,414 | 13,441 | 13,497 | 14,995 | 16,322 | 16,730 |
| EBITDA | 42,813 | 43,107 | 44,381 | 46,975 | 49,411 | 50,646 |
| (−) Tax | 4,783 | 4,997 | 5,202 | 5,387 | 5,573 | — |
| (−) CapEx | 16,828 | 17,578 | 18,301 | 18,950 | 19,606 | — |
| (−) ΔWC | -1,106 | 302 | 291 | 261 | 264 | — |
| Free Cash Flow (FCF) | 22,308 | 20,230 | 20,588 | 22,377 | 23,967 | — |
| Peers' EBITDA Multiple | 7.5x | |||||
| Terminal Value | 377,312 | |||||
| WACC / Discount Rate | 6.81% | |||||
| Timing of FCF (mid year) | 0.5 | 1.5 | 2.5 | 3.5 | 4.5 | 5 |
| Present Value of FCF | 21,584 | 18,325 | 17,460 | 17,767 | 17,815 | 271,365 |
| Enterprise Value | 364,316 | |||||
| Projection Period | 92,951 | 25.5% | ||||
| Terminal Value | 271,365 | 74.5% | ||||
| (−) Current Net Debt | 116,671 | |||||
| Equity Value | 247,645 | |||||
| (÷) Outstanding Shares | 1131M | |||||
| Fair Price | $219 | +3.3% | ||||
| WACC \ EV/EBITDA Exit Multiple | 3.5x | 5.5x | 7.5x | 9.5x | 11.5x |
|---|---|---|---|---|---|
| 4.8% | $105 | $176 | $247 | $318 | $388 |
| 5.8% | $98 | $165 | $233 | $300 | $368 |
| 6.8% | $90 | $155 | $219 | $283 | $348 |
| 7.8% | $83 | $145 | $206 | $268 | $329 |
| 8.8% | $77 | $136 | $194 | $253 | $312 |
Current price: $211.95. Green = undervalued, Red = overvalued.
Based on default parameters
This is an unlevered Free Cash Flow to Firm (FCFF) model with a 5-year projection period. Revenue, expenses, D&A, and working capital are projected using the same line-by-line approach as the Growth Exit models. The key difference is the terminal value methodology: instead of assuming perpetual cash flow growth, the terminal value is calculated by applying the industry peer median EV/EBITDA multiple to the projected Year 6 EBITDA.
Using a peer exit multiple anchors the terminal value to how the market currently prices comparable companies, rather than relying on a theoretical perpetual growth assumption. This approach captures relative valuation dynamics and is particularly useful when a company is expected to converge toward industry-average profitability over time. The sensitivity matrix shows how fair value changes across different WACC and EV/EBITDA multiple scenarios.