Can United States Cellular Ride Higher on Its Spectrum Strategy?

Core Viewpoint - United States Cellular Corporation has experienced a significant share price increase of nearly 53% in 2024 despite losing approximately 96,000 postpaid device subscriptions [1] Spectrum Strategy - United States Cellular has adopted a unique strategy involving the sale of spectrum assets to major telecom companies, which has contributed to the increase in share value [2][3] - The company has sold billions in spectrum assets to T-Mobile, Verizon, and AT&T, with a notable deal involving T-Mobile expected to close in mid-2025 pending regulatory approval [3][5] Spectrum Asset Value - Spectrum is a finite resource, and the demand for it has led to high auction prices, with over $200 billion in spectrum assets auctioned in the U.S. from 2020 to 2022 [4] - United States Cellular has approximately 30$0.876/MHz/pop in 2021 to $0.106/MHz/pop, representing an 88$174 million, down from an estimated $1.4 billion at its peak [7] Future Catalysts - Analysts forecast a 12-month stock price target of$80.00 for United States Cellular, indicating a potential upside of 29.16% [8] - The company may also consider selling its tower assets, which are valued in the billions, as a potential catalyst for share price increases [9] Market Context - Merger enforcement actions have decreased under the Biden Administration, which may impact the regulatory landscape for United States Cellular's deals [9] - Despite a "Buy" rating from analysts, other stocks are currently viewed as better investment opportunities [10][11]