TIGO Stock Forecast & Price Target

Millicom International Cellular is strategically expanding its market presence by agreeing to acquire Telefonica's operations in Ecuador and Uruguay, which will enhance its service offerings in the telecom sector. The company's wireless networks currently cover approximately 120 million people, serving 42 million customers, while its fixed-line infrastructure reaches 14 million homes and supports about 4 million broadband customers. Despite anticipated challenges associated with a 74% increase in net debt due to these acquisitions, the firm is positioned to implement an effective turnaround strategy in areas affected by sub-optimal operations, potentially improving its financial performance in underperforming regions.

The capex-to-sales ratio for Millicom International Cellular in 2024 is notably low at 12.2%, indicating potential underinvestment in infrastructure which could affect long-term growth and competitiveness. New market entrants, such as Nubicom SRL in Argentina, are expected to introduce new 5G networks, which may pressure average revenue per user (ARPU) and overall margins for existing operators like Millicom. These factors combined suggest a challenging operational environment that could hinder financial performance moving forward.