This week’s market capitalization changes for both the Fab Five (-$208 billion) and the Telco Top Five (-$4 billion) can best be summarized as “window dressing.” Investors who purchased a Fab Five over the last three or six months sell a portion of their appreciated holdings to improve current quarter earnings. And who’s to blame them? Over the last six months, Google is up 48%, Microsoft is up 31% and Meta is up 22%. Even Apple enjoyed a market cap revival over the last week (+$150 billion) as investors cheered data showing the iPhone 17 unit volume is better than expectations (as we mentioned in the last Brief, we see a sales pattern that is similar to the iPhone 16 from our limited view – more details after our analysis is released tomorrow).
While everyone expected Mike Sievert to leave soon, the announcement and media tour still took many investors by surprise. Here is an excerpt from the CNBC interview:
Leadership transitions are never easy, especially when they are accompanied by larger management changes. From May 1, 2020 through last Friday, a share of TMUS has appreciated 176% – around 19% compounded annual return. The S&P returned 134%, AT&T 25% and Verizon a negative 23% (note – all of these figures exclude dividends). Data in this chart.
We will write more in the coming weeks, but Mike Sievert completed the John Legere era vision with a smile and less cussing. He pulled off the Sprint merger with minimal issues, spent capital wisely, and guided the company through the tumultuous post-COVID years. Most importantly, he built a tightly knit team and empowered them to learn how to lead. While there is much to do (and many in the US telecom community still view Mike’s successor as a German plant), this may be the best time to move T-Mobile beyond the thirteen-year successful pirate ship adventure into a new phase.
File is below. More in next week’s full Brief.
