TIM Group (TIIAY) AI Stock Analysis

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TIM Group

(OTC:TIIAY)

64Neutral

TIM Group's overall stock score is impacted by financial challenges, including declining revenues and profitability issues, as well as high leverage. Positive technical momentum offers some optimism, but the negative P/E ratio and lack of dividend yield reflect valuation concerns. The absence of new earnings call insights or corporate events leaves the current analysis based on existing financial and technical data.

TIM Group (TIIAY) vs. S&P 500 (SPY)

Market Cap

$8.28B

Dividend YieldN/A

Average Volume (3M)1.19K

Price to Earnings (P/E)―

Beta (1Y)0.40

Revenue Growth-11.32%

EPS Growth70.32%

CountryUS

Employees26,824

SectorCommunication Services

Sector Strength76

IndustryTelecommunications Services

Share Statistics

EPS (TTM)-0.22

Shares Outstanding1,532,946,700

10 Day Avg. Volume0

30 Day Avg. Volume1,194

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)0.36

Price to Cash Flow (P/CF)N/A

P/FCF Ratio0.00

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price TargetN/A

Price Target UpsideN/A

Rating ConsensusHold

Number of Analyst Covering0

TIM Group Business Overview & Revenue Model

Company DescriptionTelecom Italia S.p.A., together with its subsidiaries, provides fixed and mobile telecommunications services in Italy and internationally. The company operates through Domestic, Brazil, and Other Operations segments. It offers fixed and mobile voice and Internet, and public telephony services, as well as products managed and developed for individuals and families; and voice, data, and Internet services and products, and information and communications technology solutions for small and medium-size enterprises, small offices/home offices, the public sector, large accounts, and enterprises in the fixed and mobile telecommunications markets. The company also manages and develops a portfolio of regulated and unregulated wholesale services for fixed-line and mobile telecommunications operators; and development, engineering, construction, and operation of network infrastructures, information technology (IT), and systems and properties. In addition, it is involved in customer care, operating credit support, loyalty, and retention activities. The company has a strategic partnership with Google Cloud. Telecom Italia S.p.A. was incorporated in 1908 and is headquartered in Rome, Italy.

How the Company Makes MoneyTIM Group generates revenue primarily through its telecommunications services. The company's key revenue streams include subscription fees from mobile and fixed-line telephony services, broadband internet services, and digital solutions such as cloud computing and IT services. TIM Group also earns money from its wholesale operations, providing infrastructure and network services to other telecom operators. Significant partnerships with technology providers and collaborations in digital innovation further contribute to its earnings by enhancing service offerings and expanding market reach.

TIM Group Financial Statement Overview

Summary

Telecom Italia SPA faces significant profitability challenges with declining revenue and persistent net losses. The company is heavily leveraged, which poses financial risks. However, its ability to generate positive operating cash flow provides some stability. Addressing leverage and improving profitability will be key to enhancing financial health.

Income Statement

Neutral

The company shows a declining revenue trend with a negative revenue growth rate from the previous year to TTM. The gross profit margin has decreased, and the company is currently experiencing a negative net income, resulting in a negative net profit margin. The EBIT and EBITDA margins remain positive, indicating some operational efficiency, but overall profitability is challenged by significant net losses.

Balance Sheet

Neutral

The balance sheet indicates a high debt-to-equity ratio, reflecting significant leverage. Stockholders' equity has been declining, which impacts the equity ratio negatively. Return on equity is negative due to net losses, indicating challenges in generating returns for equity holders. The company must manage its debt levels carefully to mitigate financial risks.

Cash Flow

Neutral

The company has shown improvement in free cash flow, moving from negative to positive in the TTM period. The operating cash flow to net income ratio is strong due to positive operating cash flow despite net losses, indicating resilient cash-generating operations. However, the free cash flow growth rate is volatile, and consistent positive cash flow remains a challenge.

Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Breakdown
Income Statement		Total Revenue
14.44B	16.30B	15.79B	15.32B	15.80B
	Gross Profit
6.73B	8.08B	9.13B	9.25B	10.13B
	EBIT
1.54B	836.00M	606.00M	-3.53B	2.10B
	EBITDA
4.80B	5.71B	5.51B	1.16B	7.25B
	Net Income Common Stockholders
-610.00M	-1.44B	-2.92B	-8.65B	7.22B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
4.46B	4.97B	5.00B	9.15B	5.92B
	Total Assets
37.66B	62.16B	62.03B	69.19B	73.23B
	Total Debt
14.72B	31.55B	31.19B	32.10B	29.95B
	Net Debt
11.79B	28.64B	27.63B	25.20B	25.12B
	Total Liabilities
24.30B	44.65B	43.30B	47.15B	44.39B
	Stockholders Equity
11.96B	13.65B	15.06B	17.41B	26.21B
Cash Flow		Free Cash Flow
402.00M	-25.00M	-1.41B	323.00M	1.85B
	Operating Cash Flow
3.25B	3.94B	4.89B	4.34B	6.55B
	Investing Cash Flow
5.36B	-4.15B	-5.33B	-5.12B	-3.08B
	Financing Cash Flow
-7.25B	-456.00M	-2.87B	3.16B	-2.01B

TIM Group Technical Analysis

Technical Analysis Sentiment

Positive

Last Price3.78

Price Trends

50DMA

3.17

Positive

100DMA

2.91

Positive

200DMA

2.74

Positive

Market Momentum

MACD

0.17

Negative

RSI

69.61

Neutral

STOCH

99.55

Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TIIAY, the sentiment is Positive. The current price of 3.78 is above the 20-day moving average (MA) of 3.44, above the 50-day MA of 3.17, and above the 200-day MA of 2.74, indicating a bullish trend. The MACD of 0.17 indicates Negative momentum. The RSI at 69.61 is Neutral, neither overbought nor oversold. The STOCH value of 99.55 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for TIIAY.

TIM Group Peers Comparison

Overall Rating

UnderperformOutperform

Sector (58)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TIMB	82 Outperform	$7.57B	12.91	12.04%	3.47%	-0.91%	1.51%
SKM	76 Outperform	$8.72B	9.84	11.19%	4.92%	-2.34%	12.31%
KT	70 Outperform	$8.47B	26.37	3.02%	5.65%	-3.60%	-51.54%
TEO	64 Neutral	$4.39B	4.88	23.27%	―	-26.74%	―
TIIAY	64 Neutral	$8.28B	―	-1.31%	―	-11.32%	70.32%
Sector *	58 Neutral	$13.14B	6.83	-2.45%	3.85%	2.36%	-36.75%
FYBR	57 Neutral	$9.02B	―	-6.30%	―	3.23%	-1196.02%

* Communication Services Sector Average

Performance Comparison

TIIAY

TIM Group

3.78

1.37

56.85%

18.64

5.99

47.35%

SKM

Sk Telecom

22.68

2.19

10.69%

TEO

Telecom Argentina

10.47

3.02

40.54%

TIMB

TIM

15.92

0.42

2.71%

FYBR

Frontier Communications Parent

36.15

13.29

58.14%

TIM Group Earnings Call Summary

Earnings Call Date: Feb 12, 2025 | % Change Since: 20.00% | Next Earnings Date: May 7, 2025

Earnings Call Sentiment Positive

The earnings call highlighted strong financial performance with significant growth in revenue and EBITDA, a reduction in net debt, and successful execution in the enterprise and Brazilian segments. However, challenges remain with increased competition from energy players in the fixed line market and ongoing pressure in the mobile market. Overall, the positive aspects of the call, particularly the financial and operational growth, outweigh the challenges.

Highlights

Revenue Growth at Group and Domestic Levels

Group revenues were up 3.4%, and domestic revenues increased by 1.8% over the first nine months.

EBITDA Growth and Margin Improvement

EBITDA after lease increased by 11% at the group level and by 8.3% domestically, with margins up 1.8 percentage points to approximately 26%.

Net Debt Reduction

Net debt after lease reduced by over €100 million in Q3, landing just below €8 billion.

TIM Brasil Performance

TIM Brasil is delivering significant top-line and EBITDA growth, outperforming peers in terms of EBITDA and cash flow margin.

Enterprise Segment Growth

Enterprise services revenue increased by 8%, with a further acceleration in Q3 to 11%, driven by cloud, security, and IoT services.

Success of National Strategic Hub

The National Strategic Hub exceeded expectations, with cloud service revenue increasing by 22%.

Cost Efficiency Achievements

The cost transformation plan achieved approximately €170 million in savings, equivalent to almost 80% of the full-year target.

Lowlights

Increased Competition in Fixed Line

Increasing pressure from energy players in the wireline market is noted as a potential threat.

Challenges in Mobile Market

ARPU in the mobile segment was still down year-on-year despite sequential improvement.

Roaming Revenue Decline

Connectivity revenues were impacted by a decline in roaming during the summer.

Company Guidance

During the third-quarter call for 2024, TIM provided guidance indicating strong performance across various metrics. At the group level, revenues increased by 3.4%, while EBITDA after lease saw an 11% rise. The company reported a CapEx of €1.3 billion, representing 12.5% of revenues, and an EBITDA after lease minus CapEx of €1.4 billion, marking a 35% increase. Net debt after lease decreased by over €100 million in Q3, settling just below €8 billion. Domestically, revenues grew by 1.8%, and EBITDA after lease was up 8.3%. The domestic CapEx amounted to €0.8 billion or 10.5% of revenues, with an EBITDA after lease minus CapEx growth of 38%, reaching €0.7 billion. TIM Brasil also contributed significantly, with strong top-line and EBITDA growth. Overall, TIM is performing slightly better than its guidance, particularly on group EBITDA after lease, while CapEx remains soft in both Italy and Brazil. This positions the company advantageously for year-end results, with potential for better-than-guidance outcomes depending on Q4 CapEx levels.

Glossary

OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.

NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.

UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.

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.