Core Insights - The significant decline in Array Digital Infrastructure's fixed-income securities following the sale of UScellular to T-Mobile is perceived as excessive, creating a new investment opportunity for holders of Telephone and Data Systems' preferred shares [1] Group 1: Market Dynamics - The equity market is characterized by daily price fluctuations that can lead to substantial wealth creation or destruction over the long term [1] - Pacifica Yield focuses on long-term wealth creation by targeting undervalued high-growth companies, high-dividend stocks, REITs, and green energy firms [1] Group 2: Company Specifics - The sale of UScellular to T-Mobile is a pivotal event impacting Array Digital Infrastructure's securities [1] - Telephone and Data Systems' preferred shares are highlighted as a potential investment opportunity in the current market context [1]

A month has gone by since the last earnings report for T-Mobile (TMUS) . Shares have added about 4.3% in that time frame, outperforming the S&P 500.Will the recent positive trend continue leading up to its next earnings release, or is T-Mobile due for a pullback? Well, first let's take a quick look at the most recent earnings report in order to get a better handle on the recent drivers for T-Mobile US, Inc. before we dive into how investors and analysts have reacted as of late.T-Mobile's Q2 Earnings Beat Es ...

Group 1 - T-Mobile (NASDAQ: TMUS) has shown strong growth, leading to an upgrade to neutral following its last earnings report [2] - The company continues to surprise the market with its remarkable ability to sustain growth [2] - The Value Portfolio employs a fact-based research strategy, analyzing extensive financial documents and market reports to identify investment opportunities [2] Group 2 - The analysis includes a beneficial long position in TMUS shares, indicating confidence in the company's future performance [3]

Core Viewpoint - T-Mobile is positioned as a potential Dividend Champion, having initiated its dividend in 2023 and showing strong business performance, but it has a long way to go to meet the criteria of raising dividends for 25 consecutive years [11]. Group 1: Company Performance - T-Mobile's business has been thriving, with shares increasing over 14% year-to-date as of August 14 [4]. - For Q2, T-Mobile reported diluted earnings per share of $2.84, a 14% year-over-year increase, and total revenue grew nearly 7% [5]. - The company achieved postpaid net customer additions of 1.7 million, marking its highest second-quarter additions ever [5]. Group 2: Dividend Information - T-Mobile initiated its quarterly dividend at $0.65 in 2023 and raised it to $0.88 in September 2024, representing a 35% increase [8]. - The current annual yield stands at 1.40%, which is modest but reflects a quick start for a company with less than two years of dividend payments [8]. - The company has a trailing 12-month free cash flow yield of 4.25% and a payout ratio of nearly 31%, indicating the dividend is sustainable [9]. Group 3: Future Dividend Prospects - Management has indicated an intent to grow the dividend by 10% annually, with another hike potentially coming next month [10]. - T-Mobile has paid out approximately $3.78 billion in dividends over the last year, with guidance for $17.8 billion in free cash flow this year, sufficient to cover the dividend payout [9]. Group 4: Debt and Acquisitions - At the end of Q2, T-Mobile had $6.4 billion in short-term debt and over $75 billion in long-term debt, with cash and cash equivalents around $10.3 billion [12]. - The company's debt is partly attributed to eight acquisitions made since 2021, which have contributed to revenue and free cash flow growth [12][13].

Group 1 - The article highlights the importance of closed-end funds and the potential for directional and arbitrage opportunities due to market price deviations [1] - It emphasizes the significance of timing in trades related to closed-end funds, suggesting that early access and discussions can be beneficial for investors [1] - The article introduces new baby bonds that are currently trading on the open market, indicating a focus on emerging investment opportunities [1]

Core Viewpoint - Berkshire Hathaway disclosed its Q2 holdings report, revealing a reduction in Apple and Bank of America shares, while also unveiling new investments in healthcare, steel, and real estate sectors [2][5]. Group 1: New Investments - Berkshire initiated positions in six new stocks during Q2, including UnitedHealth (UNH), Nucor Steel (NUE), Lennar (LEN), D.R. Horton (DHI), Lamar Advertising (LAMR), and Allegion (ALLE) [2][6]. - The total market value of these new positions at the end of Q2 was approximately $3.65 billion [6]. Group 2: Reduction in Holdings - In Q2, Berkshire reduced its stake in Apple by 20 million shares, a decrease of about 6.67%, while still maintaining it as the largest holding [9]. - Additionally, Berkshire sold over 26.3 million shares of Bank of America, representing a reduction of approximately 4.17% [9]. Group 3: Market Reaction - Following the announcement of new positions, stocks like UnitedHealth and Nucor Steel saw significant after-hours gains, with increases exceeding 8% [3]. Group 4: Investment Strategy - The new investments are viewed as defensive positions with potential for valuation recovery, aligning with Buffett's investment philosophy of seeking companies with a "moat" [7].

Core Insights - Berkshire Hathaway, led by Warren Buffett, reported its Q2 holdings as of June 30, revealing new positions in six stocks, including over 5 million shares of UnitedHealth (UNH.N) and over 6.6 million shares of Nucor Steel (NUE.N) [2] - The company reduced its stake in Apple (AAPL.O) by 20 million shares and in Bank of America (BAC.N) by 26.31 million shares [2] - Berkshire increased its position in Chevron (CVX.N) by over 3.45 million shares and completely exited its investment in T-Mobile US (TMUS.O) [2]

Core Insights - Berkshire Hathaway, led by Warren Buffett, has resumed selling its largest holding, Apple, and has further reduced its stake in Bank of America while making significant investments in UnitedHealth and revealing new positions in Nucor and two real estate stocks [1][8][12]. Investment Actions - In Q2, Berkshire purchased approximately 5.04 million shares of UnitedHealth, with a market value of about $1.57 billion, making it the 18th largest holding [2][15]. - The "mystery" holding Nucor Steel was revealed, with Berkshire acquiring 6.61 million shares valued at over $857 million, ranking as the 25th largest holding [3][5]. - Berkshire also bought around 7.05 million shares of Lennar, valued at approximately $780 million, and over 1.48 million shares of D.R. Horton, valued at about $191 million [6][7]. Reductions in Holdings - Berkshire reduced its Apple holdings by 20 million shares, a decrease of 6.67%, bringing its total to approximately 280 million shares, with a market value reduction of $4.1 billion [8][10]. - The stake in Bank of America was cut by about 26.31 million shares, a 4.71% decrease, with a market value reduction of $1.24 billion [11][12]. - Berkshire completely exited its position in T-Mobile, selling 3.88 million shares [13]. Portfolio Composition - By the end of Q2, Apple's holding represented 22.31% of Berkshire's portfolio, while Bank of America accounted for 11.12% [10][11]. - Chevron was the only stock among the top ten holdings to see an increase, with Berkshire adding 3.45 million shares, although its percentage of the portfolio decreased from 7.69% to 6.79% due to a decline in stock price [19]. Market Reactions - Following the disclosure of Berkshire's investment in UnitedHealth, the stock price surged over 9% in after-hours trading [16].

Group 1 - Berkshire reduced its holdings in Apple by 20 million shares in the second quarter, yet Apple remains its largest position [1] - Berkshire also sold over 26 million shares of Bank of America [1] - The company completely exited its position in T-Mobile during the second quarter [1] Group 2 - Berkshire initiated a new position in health insurance giant UnitedHealth, purchasing approximately 5.04 million shares with a market value of nearly $1.6 billion [1] - Additionally, Berkshire entered positions in the largest steel producer Nucor, valued at over $800 million, and homebuilder Lennar, valued at nearly $800 million [1] Group 3 - Among the top ten holdings, Chevron was the only stock that Berkshire increased, adding 3.45 million shares [1]

Core Viewpoint - The National Advertising Review Board (NARB) has recommended that T-Mobile US, Inc. discontinue certain express savings claims and modify its advertising to avoid unsupported implied claims [1][5]. Group 1: Advertising Claims - The National Advertising Division (NAD) initiated a case against T-Mobile based on savings claims in various advertisements, including a brochure and commercials [2]. - T-Mobile attempted to clarify its savings claims by explicitly referencing streaming services in its advertisements [3]. - The NARB panel found that the phrase "plus streaming" used by T-Mobile was confusing and did not adequately communicate the nature of the price comparison [4][5]. Group 2: Recommendations and Compliance - The NARB panel agreed with NAD's conclusion that many consumers would misunderstand the promoted savings as being based solely on wireless plan costs without considering additional benefits [5]. - The panel recommended that T-Mobile modify its advertising to avoid implying unsupported claims, although it did not agree with all of NAD's recommendations [6]. - T-Mobile stated that it disagrees with the panel's decision but will comply with the recommendations [7].