TIM (TIMB) AI Stock Analysis

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TIM

(NYSE:TIMB)

Rating:75Outperform

Price Target:

$20.50

▲(13.95%Upside)

TIMB's strong financial performance and positive earnings call sentiment are the primary drivers of its solid stock score. The company benefits from robust revenue growth and efficient cash flow management. However, technical analysis presents bearish signals, slightly offsetting the positive outlook. The valuation is attractive, particularly due to the high dividend yield.

TIM (TIMB) vs. SPDR S&P 500 ETF (SPY)

Market Cap

$8.74B

Dividend Yield0.35%

Average Volume (3M)554.58K

Price to Earnings (P/E)14.4

Beta (1Y)0.35

Revenue Growth-6.63%

EPS Growth2.46%

CountryUS

Employees8,873

SectorCommunication Services

Sector Strength76

IndustryTelecommunications Services

Share Statistics

EPS (TTM)0.29

Shares Outstanding484,160,900

10 Day Avg. Volume502,235

30 Day Avg. Volume554,580

Financial Highlights & Ratios

PEG Ratio1.55

Price to Book (P/B)2.05

Price to Sales (P/S)0.00

P/FCF Ratio5.82

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

$21.50

Price Target Upside19.51% Upside

Rating ConsensusHold

Number of Analyst Covering3

TIM Business Overview & Revenue Model

Company DescriptionTIM S.A., a telecommunications company, provides mobile voice and data services, broadband internet access, value-added services, and other telecommunications services and products in Brazil. The company offers services for individuals, as well as corporate solutions for small, medium, and large companies. It also offers fixed-line ultra-broadband and TIM Live services, as well as WTTx technology through Ultrafibra services and IoT solutions. In addition, the company provides digital content and services in its portfolio of packages; sells various mobile handsets and accessories through its dealer network, which includes its own stores, exclusive franchises, and authorized dealers; and offers co-billing services to other telecommunication service providers. As of December 31, 2021, it served a subscriber base of 52.6 million customers. The company is headquartered in Rio de Janeiro, Brazil. TIM S.A. is a subsidiary of TIM Brasil Serviços e Participações S.A.

How the Company Makes MoneyTIM S.A. generates revenue through multiple streams, predominantly from its mobile communication services offered to both prepaid and postpaid customers. The company earns significant income through monthly subscription fees, data packages, and additional charges for value-added services such as digital content and roaming. Furthermore, TIM benefits from its fixed-line services, including broadband internet and pay-TV offerings. The company also engages in strategic partnerships and collaborations that enhance its service offerings and expand its market reach. Revenue is further bolstered by investments in network infrastructure improvements, which enhance service quality and customer satisfaction, thereby driving customer retention and acquisition.

TIM Earnings Call Summary

Earnings Call Date:May 05, 2025

(Q1-2025)

% Change Since: 11.26%|

Next Earnings Date:Jul 30, 2025

Earnings Call Sentiment Positive

The earnings call highlights strong financial performance with significant growth in mobile revenues, EBITDA, and net income. Expansion in B2B IoT and sustainability recognition further support a positive outlook. However, challenges remain in the prepaid segment and lease payments, with competitive pressures in the broadband market. Overall, the positive financial achievements outweigh the challenges faced.

Q1-2025 Updates

Positive Updates

Strong Mobile Revenue Growth

Mobile revenues increased by 6.2% year-over-year, driven by strong post-pay growth, which grew close to 14% yearly.

EBITDA and Margin Improvement

EBITDA grew by 6.7% year-over-year, with margin expansion reflecting efficient operational execution, adding 80 basis points to the margin, which surpassed 48%.

Net Income and Cash Flow Growth

Net income grew more than 50% year-over-year, marking the 80th consecutive quarter of double-digit expansion and reaching the highest net income level for the first quarter in TIM's history. Operational cash flow also saw a double-digit increase of almost 20%.

Expansion in B2B IoT Strategy

Substantial growth in contracted revenues in B2B IoT, particularly in agribusiness, logistics, and utilities, with new initiatives in the energy sector.

Sustainability Recognition

TIM was confirmed as the most sustainable company in Brazil, ranking first in the Corporate Sustainability Index of the Brazilian Stock Exchange.

Negative Updates

Challenges in Prepaid Segment

Prepaid segment continues to underperform due to market dynamics and constraints on the demand side, with a strategy focused on slowing down the decrease over time.

Lease Payment Concerns

Lease payments grew high single-digit year-over-year, with concerns about inflation impact, particularly related to lease agreements tied to IPCA.

Pressure on Broadband Market

The broadband market remains highly competitive, impacting ARPU and churn levels, with TIM Ultrafibra experiencing a decrease in revenue growth.

Company Guidance

The guidance provided in the call highlights TIM S.A.'s robust performance in the first quarter of 2025, despite external market volatility, with a focus on strategic initiatives and financial metrics. Mobile revenues saw a 6.2% year-over-year increase, driven by a strong 14% growth in the postpaid segment, contributing to a 6.7% rise in EBITDA with a margin expansion of 80 basis points, surpassing 48%. Operational cash flow also experienced a double-digit increase, nearing 20%, while net income grew by over 50%, marking the 80th consecutive quarter of double-digit expansion. The company announced R690 million as interest on capital and emphasized strategic focus areas, including enhancing the mobile value proposition, expanding the B2B IoT portfolio, and maintaining operational efficiency. Special attention is given to Sao Paolo, with initiatives like modernizing over 3,000 network sites, resulting in a 40% increase in coverage and capacity, and efforts to boost brand perception through events and a flagship store. TIM S.A. remains committed to sustainability and aims to integrate innovative solutions to elevate its value proposition further.

TIM Financial Statement Overview

Summary

TIM has shown strong financial performance with significant revenue growth, robust profit margins, and efficient cash flow management. The company maintains a stable balance sheet with moderate leverage, indicating a well-managed financial structure.

Income Statement

Very Positive

TIM has demonstrated strong revenue growth, with a Revenue Growth Rate of approximately 6.5% from 2023 to TTM. The Gross Profit Margin is robust at 51.8%, indicating effective cost management. The Net Profit Margin has improved to 13.3% in TTM, showcasing enhanced profitability. The EBIT and EBITDA margins are healthy at 22.6% and 51.3% respectively, suggesting solid operational efficiency.

Balance Sheet

Positive

The company's Debt-to-Equity Ratio stands at 0.65, reflecting moderate leverage. The Equity Ratio is 43.3%, indicating a stable capital structure with substantial equity financing. ROE has improved to 14.0%, showing effective utilization of equity capital to generate profits. Overall, the balance sheet exhibits a healthy financial position with manageable debt levels.

Cash Flow

Very Positive

The Free Cash Flow Growth Rate is a strong 11.1%, indicating significant cash generation capability. The Operating Cash Flow to Net Income Ratio of 3.8 suggests efficient cash conversion from earnings. The Free Cash Flow to Net Income Ratio is 2.5, indicating substantial cash flow relative to net income, supporting sustainability and potential future growth.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	25.45B	23.83B	21.53B	18.06B	17.27B
Gross Profit	13.55B	12.34B	10.87B	9.62B	9.27B
EBITDA	12.99B	12.17B	10.16B	9.84B	8.38B
Net Income	3.15B	2.84B	1.67B	2.96B	1.83B
Balance Sheet
Total Assets	56.33B	55.26B	56.41B	49.82B	41.65B
Cash, Cash Equivalents and Short-Term Investments	5.69B	5.04B	4.74B	9.80B	4.65B
Total Debt	15.61B	16.03B	17.80B	12.91B	10.72B
Total Liabilities	29.92B	29.24B	31.01B	24.71B	18.47B
Stockholders Equity	26.40B	26.02B	25.40B	25.11B	23.18B
Cash Flow
Free Cash Flow	7.78B	7.92B	4.70B	4.62B	4.78B
Operating Cash Flow	12.33B	12.42B	9.43B	9.91B	8.67B
Investing Cash Flow	-4.95B	-4.68B	-8.62B	-6.52B	-5.29B
Financing Cash Flow	-7.20B	-7.21B	-3.49B	-735.37M	-3.09B

TIM Technical Analysis

Technical Analysis Sentiment

Negative

Last Price17.99

Price Trends

50DMA

18.44

Negative

100DMA

16.70

Positive

200DMA

14.72

Positive

Market Momentum

MACD

-0.17

Positive

RSI

40.71

Neutral

STOCH

21.90

Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For TIMB, the sentiment is Negative. The current price of 17.99 is below the 20-day moving average (MA) of 19.16, below the 50-day MA of 18.44, and above the 200-day MA of 14.72, indicating a neutral trend. The MACD of -0.17 indicates Positive momentum. The RSI at 40.71 is Neutral, neither overbought nor oversold. The STOCH value of 21.90 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for TIMB.

TIM Risk Analysis

TIM disclosed 40 risk factors in its most recent earnings report. TIM reported the most risks in the "Finance & Corporate" category.

Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy

Latest Risks Added 0 New Risks

TIM Peers Comparison

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
VIV	77 Outperform	$18.09B	17.83	7.95%	0.40%	-5.69%	-0.05%
TKC	77 Outperform	$5.08B	12.14	6.74%	1.71%	14.09%	-11.43%
TIMB	75 Outperform	$8.74B	14.37	13.18%	0.35%	-6.63%	2.46%
KT	71 Outperform	$10.02B	22.80	3.81%	0.17%	-4.85%	-43.88%
SKM	69 Neutral	$8.56B	9.71	11.08%	0.22%	-4.13%	4.96%
Sector *	64 Neutral	€14.85B	-11.21	1.40%	3.86%	2.00%	1.26%
TEF	59 Neutral	$30.64B	―	-0.55%	1.01%	-2.29%	-182.68%

* Communication Services Sector Average

Performance Comparison

TIMB

TIM

17.99

4.78

36.18%

20.65

6.55

46.45%

SKM

Sk Telecom

22.23

0.21

0.95%

VIV

Telefonica Brasil

11.05

2.93

36.08%

TEF

Telefonica

5.39

1.09

25.35%

TKC

Turkcell Iletisim

5.68

-1.96

-25.65%

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.Date of analysis: Jul 25, 2025