Buffett Brain · Research note
Score updated 29 Oct 2026 · analysis from 2 Jun 2026
TMUS· Communication Services
T-Mobile US
T-Mobile is a fine wireless carrier carrying a heavy mortgage, with net debt running near 4.1 times its yearly cash earnings.
Buffett fit
Partial fit
Owner
36
Durability
79
Management
65
Price
67
Score updated 29 Oct 2026 · analysis from 2 Jun 2026
Buffett's checklist
Each number against Buffett's bar, and where it ranks among Communication Services stocks in our database.
How much profit the business makes on each dollar invested in it. Higher is better.
What is left of each sale after the cost of making the product. A high number often means pricing power.
The cash the business earns for its owners, compared with the price of the whole company.
How fast sales grew each year over the last five years.
How many years of today's profit you pay for at today's price. Lower means cheaper.
How much the company owes compared with what it owns outright. Lower is safer.
The four pillars
How the business measures up on each of Buffett's four tests.
If I owned the whole company I would notice that I am earning a 7.0 percent return on the capital in the business this year, and only 4.1 percent averaged over five years.
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People will still buy phone service in twenty years, and that is why durability scores a solid 79.
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Management gets reasonable marks at 65. They shrank the share count by 2.5 percent a year, they convert net income into at 1.64 times, which is excellent, and the Sprint integration has gone better than skeptics feared.
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Here the picture is mixed rather than cheap. The stock trades at 19.7 times earnings for an earnings yield of just 5.1 percent, which is no bargain for a slow grower.
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For and against
The strongest points on each side, with the numbers behind them.
In its favor
7- 1Strong profitability for a carrier, with a 54.3 percent and a 20.4 percent
- 2Excellent cash conversion, turning net income into at 1.64 times
- 3 yield of 8.8 percent gives a real cash return on the current price
- 4Durable demand and a sticky subscriber base, reflected in a worst-year earnings decline of only 14 percent
Concerns
7- 1Heavy : net debt is 4.1 times EBITDA and debt to equity is 2.11, leaving little room for error
- 2Thin interest coverage of only 4.9 times, so a rough stretch would pinch the lenders before the owners
- 3Poor returns on capital, just 7.0 percent this year and 4.1 percent averaged over five years
- 4Slow underlying growth, with revenue at only 2.5 percent a year
Price history
$148+28.7%· 5-year return
Weekly closing prices. Touch or hover the line for a date.
The business
How the business works
T-Mobile sells wireless phone and data service to consumers and businesses on a subscription basis, and it does it well, posting a 54.3 percent and a 20.4 percent . Revenue, though, barely grows, at 2.5 percent a year, so most of the recent 41.7 percent earnings growth came from , cost cutting after the Sprint deal, and lower share count rather than from selling much more service. This is a capital-hungry business that must keep pouring money into spectrum and towers just to stand still.
How this analysis has moved
The call has held across 6 reviews.
Sep 27, 2026 → Oct 29, 2026
What other investors would say
The same company, judged by three other documented playbooks.
Keep researching
Similar companies in Communication Services
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