T-Mobile Issues its First-Ever Dividend to Shareholders

T-mobile dividends

Telecommunications had a turbulent ride this year, with major players in the industry observing significant drops in their performance.

AT&T Inc. (NYSE: T) saw a decline of 20% in its stock value since the start of the year, while Verizon Communications Inc. (NYSE: VZ) experienced a dip of 12%. Contrasting this trend, T-Mobile US, Inc. (NASDAQ: TMUS) remained stable, with its stock showing minimal change year-to-date.

Wednesday marked a significant day for T-Mobile as the company declared its decision to disburse its first-ever dividend to its shareholders.

Speaking at the Goldman Sachs Communacopia and Tech Conference in San Francisco, Sievert mentioned to Yahoo Finance Live, “Our performance stands out in the sector. Our primary goal remains to finance this unparalleled business plan, both internally and externally, focusing on the core as well as potential new markets.”

Following the dividend’s revelation, T-Mobile’s stock surged by 4% the subsequent Thursday afternoon.

Sievert elaborated, “Last year, we presented an ambitious goal foreseeing up to $60 billion in shareholder returns over our planning horizon. We’re now moving to the next phase: a $19 billion return in the upcoming five quarters, which includes our maiden dividend — an annual disbursement of $3 billion. That translates to an aggregate of $3.75 billion over these five quarters, with an expected yearly increment of approximately 10%.”

Prominent telecom leaders, AT&T Inc. and Verizon Communications Inc., have been recognized for their generous dividend distributions, with AT&T allocating around $8 billion and Verizon distributing close to $11 billion annually as stock dividends.

With an eye on the future, Sievert is keen on maximizing this pivotal moment.

Despite the overall sales decreasing by 2% year-over-year to $19.2 billion in Q2, T-Mobile recorded postpaid net additions surpassing predictions and saw a reduction in the number of subscribers departing from their network.

Expressing confidence, Sievert communicated that stakeholders can anticipate sustained superior earnings growth and the generation of substantial cash flows.

He emphasized to Yahoo Finance Live, “What we promise our investors is continuous, sustainable growth that eventually leads to the best-in-class cash flow growth, which we’ve been consistently delivering. This makes us believe it’s the right time to proceed to the next phase concerning our enduring objectives about shareholder payouts.”

It’s noteworthy to mention the prevalent positive sentiment among Wall Street analysts regarding T-Mobile, with current evaluations comprising 31 Buys, three Holds, and a single Sell.

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