Telephone & Data Systems (TDS)
NYSE:TDS
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Telephone & Data Systems
(NYSE:TDS)
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Rating:56Neutral
Price Target:
$45.00
▲(7.32% Upside)
Action:ReiteratedDate:02/24/26
Overall score reflects weak financial performance (sharp revenue decline and earnings volatility, with leverage constraints) partially offset by solid operating cash flow. The latest earnings call improves the outlook due to major liquidity/balance-sheet actions and defined growth milestones, though execution and contract-related uncertainties remain. Technicals and valuation are mixed, with modest longer-term price support and a high dividend yield tempered by loss-making earnings (negative P/E).
Positive Factors
Consistent Operating Cash Flow
TDS’s consistently positive operating cash flow across the period provides durable liquidity to fund operations, service debt, and support capital programs. That entrenched cash generation underpins strategic investments like fiber builds and reduces reliance on external financing during multi-quarter execution.
Negative Factors
Multi-year Revenue Decline
A severe multi-year revenue contraction, especially the sharp 2025 decline, erodes the earnings base and scale benefits. Sustained top-line weakness increases pressure on margins, cash conversion and return on invested capital, making recovery dependent on successful growth initiatives and stabilization.
Read all positive and negative factors
Positive Factors
Negative Factors
Consistent Operating Cash Flow
TDS’s consistently positive operating cash flow across the period provides durable liquidity to fund operations, service debt, and support capital programs. That entrenched cash generation underpins strategic investments like fiber builds and reduces reliance on external financing during multi-quarter execution.
Read all positive factors
Telephone & Data Systems (TDS) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.45B
Dividend Yield0.39%
Average Volume (3M)954.65K
Price to Earnings (P/E)―
Beta (1Y)0.99
Revenue Growth-22.79%
EPS Growth79.90%
CountryUS
Employees7,900
SectorCommunication Services
Sector Strength97
IndustryTelecommunications Services
Share Statistics
EPS (TTM)0.33
Shares Outstanding106,200,000
10 Day Avg. Volume1,121,369
30 Day Avg. Volume954,654
Financial Highlights & Ratios
PEG Ratio33.88
Price to Book (P/B)0.90
Price to Sales (P/S)3.84
P/FCF Ratio24.19
Enterprise Value/Market Cap1.27
Enterprise Value/Revenue1.89
Enterprise Value/Gross Profit3.83
Enterprise Value/Ebitda6.14
Forecast
1Y Price Target
$53.00Price Target Upside26.40% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering2
EPS Forecast (FY)-0.1
Revenue Forecast (FY)$1.26B
Telephone & Data Systems Business Overview & Revenue Model
Company Description
Telephone and Data Systems, Inc., a telecommunications company, provides communications services in the United States. It operates through two segments: UScellular and TDS Telecom. The company offers wireless solutions to consumers and business an...
How the Company Makes Money
TDS generates revenue through multiple channels, with its primary earnings coming from its wireless and wireline segments. The wireless segment, primarily through U.S. Cellular, earns money by providing mobile voice and data services to customers ...
Telephone & Data Systems Earnings Call Summary
Earnings Call Date:Feb 20, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Apr 30, 2026
Earnings Call Sentiment Positive
The call conveyed a predominantly positive strategic transformation: large spectrum transactions and special dividends materially strengthened the balance sheet, enabling aggressive expansion of the fiber program (raising long-term addresses to 2.1M) and standing up a focused tower business with solid near-term leasing momentum. Q4 operational improvements (record crew counts, strongest build quarter since 2023, sequential and year-over-year fiber growth) support the constructive outlook. However, the company faces several execution and market risks: a missed 2025 fiber goal, revenue and adjusted EBITDA headwinds from divestitures and secular declines in legacy services, material uncertainty tied to the DISH MLA and T-Mobile MLA outcomes, elevated transition costs at Array, and significantly higher 2026 CapEx that requires disciplined execution. On balance, the strategic wins, liquidity events, and clear growth plans outweigh the operational and regulatory uncertainties, producing an optimistic but execution-dependent outlook.Positive Updates
Major Spectrum Transaction and Strong Balance Sheet Actions
Array closed the AT&T spectrum sale for $1,018,000,000 (closed 01/13/2026) and declared a special dividend of approximately $726,000,000; TDS repaid the last $150,000,000 of term loan debt in January 2026, materially strengthening the capital structure and providing cash flexibility for fiber investment and capital allocation.
Negative Updates
Missed 2025 Fiber Address Goal
TDS did not reach its 2025 target of 150,000 new marketable fiber addresses, delivering 140,000 (short by ~10,000). Management cited ongoing execution, systems modernization and scaling of build/install operations as areas needing improvement.
Read all updates
Q4-2025 Updates
Positive
Negative
Major Spectrum Transaction and Strong Balance Sheet Actions
Array closed the AT&T spectrum sale for $1,018,000,000 (closed 01/13/2026) and declared a special dividend of approximately $726,000,000; TDS repaid the last $150,000,000 of term loan debt in January 2026, materially strengthening the capital structure and providing cash flexibility for fiber investment and capital allocation.
Read all positive updates
Company Guidance
Management gave detailed 2026 guidance and milestones: for TDS Telecom they forecast total telecom revenues of $1,015M–$1,055M, adjusted EBITDA of $310M–$350M, 2026 fiber builds of 200k–250k new marketable service addresses, and capital spending of $550M–$600M (up from $406M in 2025); they raised the long‑term fiber target from 1.8M to 2.1M addresses (adding ~300k edge‑out opportunities), noted 2025 results of 140k new marketable addresses (58k in Q4), ~45k residential fiber net adds in 2025 (~15k in Q4), average residential revenue per connection +2% YoY, cash expenses −4% in Q4/+1% FY, adjusted EBITDA +6% Q4/−6% FY, a $100M transformation savings target by YE‑2028, repayment of $150M term loan, and share repurchases of $67M (1.8M shares) in Q4 / 2.8M shares in 2025 with $524M remaining authorization; for Array they guided total operating revenue $200M–$215M, adjusted EBITDA $200M–$215M, adjusted OIBDA $50M–$65M, and CapEx $25M–$35M (including ~$6M one‑time tower‑light migration), reported closing the AT&T spectrum sale (~$1,018M) and declaring a ~$726M special dividend, received ~$178M from T‑Mobile spectrum deals, have monetized roughly 70% of spectrum to date, processed >2,000 T‑Mobile applications with 95%+ structural analyses complete, saw Q4 cash site rental revenue +64% YoY (+8% ex‑T‑Mobile MLA, +96% incl. interim), recognized ~$7M of DISH MLA revenue in 2025, and expect 800–1,800 tenantless towers after T‑Mobile site selections.Telephone & Data Systems Financial Statement Overview
Summary
Income Statement
32
Negative
Balance Sheet
44
Neutral
Cash Flow
55
Neutral
| Breakdown | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|
Income Statement | |||||
| Total Revenue | 1.23B | 4.96B | 5.16B | 5.41B | 5.33B |
| Gross Profit | -62.00M | 2.83B | 2.83B | 2.85B | 2.86B |
| EBITDA | 553.51M | 1.20B | 682.00M | 1.08B | 1.18B |
| Net Income | -6.24M | -28.00M | -500.00M | 62.00M | 156.00M |
Balance Sheet | |||||
| Total Assets | 8.40B | 13.68B | 13.92B | 14.55B | 13.49B |
| Cash, Cash Equivalents and Short-Term Investments | 765.95M | 364.00M | 236.00M | 360.00M | 367.00M |
| Total Debt | 1.95B | 5.10B | 5.14B | 4.80B | 4.04B |
| Total Liabilities | 3.13B | 7.80B | 7.91B | 7.93B | 6.75B |
| Stockholders Equity | 5.27B | 5.09B | 5.20B | 5.85B | 5.93B |
Cash Flow | |||||
| Free Cash Flow | 195.19M | 241.00M | -199.00M | -620.00M | -48.00M |
| Operating Cash Flow | 589.89M | 1.15B | 1.14B | 1.16B | 1.10B |
| Investing Cash Flow | 2.14B | -754.00M | -1.33B | -1.78B | -2.46B |
| Financing Cash Flow | -2.35B | -277.00M | 56.00M | 613.00M | 321.00M |
Telephone & Data Systems Technical Analysis
Negative
41.93
Price Trends
44.43
Negative
41.92
Positive
39.92
Positive
Market Momentum
-0.56
Positive
39.65
Neutral
67.38
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TDS, the sentiment is Negative. The current price of 41.93 is below the 20-day moving average (MA) of 43.42, below the 50-day MA of 44.43, and above the 200-day MA of 39.92, indicating a neutral trend. The MACD of -0.56 indicates Positive momentum. The RSI at 39.65 is Neutral, neither overbought nor oversold. The STOCH value of 67.38 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TDS.
Telephone & Data Systems Risk Analysis
Telephone & Data Systems disclosed 26 risk factors in its most recent earnings report. Telephone & Data Systems reported the most risks in the "Legal & Regulatory" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Telephone & Data Systems Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
72 Outperform | $5.23B | 10.60 | 7.24% | 5.57% | 19.02% | 9.26% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
60 Neutral | $5.08B | -36.64 | -2.67% | 0.40% | 15.38% | -292.52% | |
58 Neutral | $3.20B | 6.97 | 40.63% | ― | 6.42% | ― | |
56 Neutral | $4.45B | -757.27 | -0.13% | 0.39% | -22.79% | 79.90% | |
55 Neutral | $6.83B | -4.44 | 267.95% | ― | -4.56% | 23.46% | |
52 Neutral | $3.95B | 15.83 | 8.13% | 42.91% | -25.64% | ― |
* Communication Services Sector Average
TDS
Telephone & Data Systems
41.93
3.35
8.69%
LUMN
Lumen Technologies
6.67
2.75
70.15%
TEO
Telecom Argentina
11.16
1.24
12.50%
TKC
Turkcell Iletisim
5.99
-0.05
-0.79%
AD
Array Digital Infrastructure
45.73
5.71
14.26%
VEON
VEON
46.47
2.86
6.56%
Telephone & Data Systems Corporate Events
Business Operations and StrategyDividendsM&A Transactions
TDS Unit Completes Spectrum Sale and Declares Dividend
Positive
Jan 13, 2026
On January 13, 2026, Array Digital Infrastructure, Inc., a subsidiary of Telephone and Data Systems, Inc., completed the previously announced sale of select wireless spectrum assets, including 700 MHz licenses, to ATT for $1.018 billion in cash un...
Business Operations and StrategyPrivate Placements and Financing
TDS Amends Credit Agreements to Boost Flexibility
Neutral
Dec 12, 2025
On December 8, 2025, Telephone and Data Systems, Inc. (TDS) and its subsidiary, Array Digital Infrastructure, Inc., entered into amendments to their respective credit agreements. The amendments extend the maturity date of TDS’s credit agreem...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.