F5 vs. T-Mobile US: FFIV stock's substantially higher valuation vs. TMUS appears counterintuitive

Last Updated: 12/6/2024

T-Mobile US Appears To Be A Better Choice Compared To F5

TMUS valuation (P/EBIT) is lower vs. FFIV, but TMUS has performed better on growth and better on margins

This disconnect between valuation and financial performance implies that TMUS could be a better buy 

 

F5 valuation (P/EBIT) is substantially higher compared to T-Mobile US

FFIV vs. TMUS P/EBIT Change In Last 3 Years: -37% vs. -0.8%

F5 revenue growth is worse compared to T-Mobile US

FFIV vs. TMUS Revenue Growth:   Last Q: 5.6% vs. 4.7%; Last 12 Months: 0.1% vs. 2.1%; Last 3 Years Average: 2.6% vs. 4.7%

F5's EBIT margin expansion is worse compared to T-Mobile US

FFIV vs. TMUS EBIT Margin Change:   Last 3 Years: 1.6x vs. 2.2x

While T-Mobile US appears to be the better choice today, how has its stock performed vs. F5 in the past?

Since 2020, returns have been:

  • 55% for F5 (FFIV)
  • 301% for T-Mobile US (TMUS) 
  • 141% for S&P 500 
  • 627% for Trefis Multi-Strategy Portfolio 

Making Sense Of Counterintuitive Comparisons

Concepts, FAQ, And Things You May Want To Know

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[2] How Do You Find These Counterintuitive Pairs?

[3] If I Were To Decide Based On Counterintuitive Comparisons, How Likely Is It That I Will Make The Right Pick?

[4] Where Can I See More Such Counterintuitive Comparisons?

[5] I Don't Want To Go Through Multiple Comparisons, Can You Simplify Investment Decision For Me?

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