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what it is
TDS sells wireless and wireline phone and internet service to 5.5 million customers across 31 states.
how it gets paid
Last year Telephone and Data Systems made $1.1B in revenue. u.s. cellular service was the main engine at $0.62B, or 56% of sales.
why growth slowed
Full-year revenue fell about 9.0% last year on a comparable basis. Ignore any giant quarter-over-quarter percentage unless you line it up with the same segment and period in the 10-Q—EPS swings can be noisy around one-offs and accounting items.
what just happened
TDS posted $0.33 EPS in its latest reported quarter, versus a consensus estimate of -$0.22.
At a glance
B+ balance sheet — decent shape, but not bulletproof
25/100 earnings predictability — expect surprises
87.5x trailing p/e — you're paying up for this one
0.5% dividend yield — cash in your pocket every quarter
2.0% return on capital — nothing to write home about
xvary composite: 43/100 — below average
What they do
TDS sells wireless and wireline phone and internet service to 5.5 million customers across 31 states.
This is a local-utility style business. Your phone line or wireless plan is boring until it breaks, which keeps churn low when service works. TDS serves 5.5 million customers in 31 states, and that installed base gives it recurring revenue even after annual sales fell 9% to $1.1 billion.
How they make money
$1.1B
annual revenue · their business grew -9.0% last year
u.s. cellular service
$0.62B
u.s. cellular equipment
$0.22B
tds telecom broadband
$0.17B
tds telecom voice and legacy
$0.09B
The products that matter
wireless and landline connectivity
Telecom services
$1.1B · entire reported revenue base
it is the whole $1.1B business in this snapshot, and it declined 9.0% last year. that makes the core question simple: can the base stop shrinking.
core
cellular operations
Wireless
included in $1.1B total revenue
cellular sits inside the segment bars above (wireless service plus equipment). when the mix shifts between service and equipment, margin tells you whether subscribers or handset sales are doing the work.
data thin
traditional phone network operations
Landline
included in $1.1B total revenue
landline operations are part of the mix, which matters because mature telecom lines rarely get premium multiples on their own. the stock has to earn its valuation through improvement.
mature segment
Key numbers
-15.0%
projected revenue change (directional)
Street models were pointing to a mid‑teens percent revenue headwind versus the ~$1.1B base—treat as directional until you read the same estimate date on your data terminal.
87.5x
trailing p/e
Price-to-earnings → how much you pay for each dollar of profit → so what: you are paying a premium multiple for a company that lost money on an operating basis.
-9.1%
operating margin
Operating margin → profit after running the business → so what: a negative print means the core operation lost about $9.10 per $100 of sales in this window.
$823M
long-term debt
Long-term debt → money owed over many years → so what: the debt load is manageable at 14% of capital, but it still limits room for mistakes.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 4 — safer than 20% of stocks
- price stability 15 / 100
- long-term debt $823M (14% of capital)
- net profit margin 8.8% — keeps 9 cents of every dollar in revenue
- return on equity 2% — $0.02 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in TDS 3 years ago → it's now worth $37,750.
The index would have given you $13,880.
source: institutional data · total return
What just happened
beat estimates
TDS posted $0.33 EPS in its latest reported quarter, versus a consensus estimate of -$0.22.
Revenue for the quarter cited in coverage was about $331 million—not feed-mashed consolidated figures in the $700M+ range. After the U.S. Cellular wireless sale and segment reclassifications, vs. prior year revenue growth percentages are often n/m; focus on EPS and segment disclosure instead. Quarterly EPS swung from about a $0.85 loss in Q3 2025 to $0.33 profit in Q4 2025, while trailing EPS can still look deeply negative depending on the window.
~$331M
revenue (q)
$0.33
eps
n/m
revenue vs. prior year
the number that mattered
The key number was $0.33 EPS versus a -$0.22 estimate, because it showed the quarter could print a profit even while the full-year revenue story stays messy after asset sales.
-
telephone & data systems ended 2025 on a high note.indeed, the company posted adjusted fourth-quarter earnings of $0.33 a share, well above our estimate, on revenues of $330.7 million.
-
as a reminder, in early august, the company’s 82%-owned u.s.cellular division (now known as array digital infrastructure) closed on the sale of its wireless operations and select spectrum assets to t-mobile for total consideration of $4.3 billion in cash and assumed debt. meanwhile, the tds telecom division continues to focus on its fiber strategy through ongoing fiber expansion, with 44,900 fiber net additions added in 2025.
-
separately, array digital grew site rental revenues by 51% vs. prior year in the final stanza of last year, and subsequently closed on the $1.018 billion sale of wireless spectrum with at&t on january 13th.all told, we now look for telephone & data systems to post 2026 earnings of $0.35 a share, and we have initiated a 2027 bottom-line call of $0.50.
-
the investment community seems enthused about the company’s prospects.
-
to wit, tds stock is up approximately 15% in value since our early december review, versus a 2.5% uptick in the s&p 500 index over the same time frame.
source: company earnings report, 2026
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What could go wrong
the biggest risk is a shrinking revenue base. this is a $1.1B telecom business that contracted 9.0% last year while the stock still trades at 87.5x trailing earnings.
high
revenue keeps moving the wrong way
annual revenue was $1.1B and fell 9.0% last year.
if that decline continues, the turnaround case gets smaller with each report.
high
valuation loses patience
the stock is at $43.75, while the 3–5 year target midpoint is $37.
that gap leaves room for multiple compression even without a collapse in the business.
med
returns on capital stay weak
return on capital is 2.0% and return on equity is 2%.
those are not numbers that naturally support an 87.5x earnings multiple.
med
the stock remains hard to underwrite quarter to quarter
earnings predictability is 25/100, price stability is 15/100, and risk rank is 4.
that is a recipe for volatility when the next report lands.
put together, you have weak operating momentum, low capital efficiency, and a current price already above the $37 long-range midpoint target.
source: institutional data · regulatory filings · risk analysis
Pay attention to
calendar
apr 30, 2026 earnings report
with 25/100 earnings predictability, this is the next hard checkpoint for the thesis.
trend
whether revenue can stop shrinking
the reported revenue base is $1.1B and it declined 9.0% last year. flat would already be progress.
risk
the gap between price and long-range target
shares trade at $43.75 versus a $37 midpoint target. that is the market daring the business to improve fast.
metric
institutional flow that is positive, but only slightly
114 buyers versus 104 sellers in 4q2025 says big money is not fleeing. it does not say they're pounding the table either.
Analyst rankings
earnings predictability
25 / 100
in human-speak, analysts do not trust this company to deliver clean, repeatable quarters.
price stability
15 / 100
this stock does not trade like a utility bond. it moves like a story stock with imperfect numbers.
risk rank
4
safer than only 20% of stocks. that is not where you go looking for calm.
source: institutional data
Institutional activity
114 buyers vs. 104 sellers in 4q2025. total institutional holdings: 0.1B shares.
source: institutional data
Price targets
3-5 year target range
$19
$55
$44
current price
$37
target midpoint · 15% from current · 3-5yr high: $50 (+15% · 3% ann'l return)
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