What Millicom Doubters Got Wrong Before A 85% Rally

If you were watching Millicom International Cellular in late 2025, the headline development was its push into full ownership of Coltel in Colombia and the promise of deeper 4G and 5G coverage. For Millicom International Cellular shareholders, the return over the past year was 85.4%, including dividends. If you had been deciding whether to buy before that acquisition closed, what exactly did you need to believe about future margins and cash generation?

A Narrative on Simply Wall St is one investor's written case for a company, with its growth, margin and multiple assumptions spelled out. Those assumptions imply an estimated Fair Value.

If the move has made Millicom International Cellular harder to judge, start where the gap is still open and scan 38 high quality undervalued stocks.

The Argument You Would Have Been Weighing Up On Millicom International Cellular

The shares cost US$47.76 at the start of the period, and the core question for Millicom International Cellular investors was how much value to place on its Latin American data and broadband push.

The bullish Narrative put Fair Value at US$55, or 15% above the start price. It was based on revenue growth of 3.3%, profit margins settling at 10.7%, and a future P/E of 15.5x.

The bearish case anchored Fair Value at US$36, or 25% below the start price. It assumed a revenue decline of 1.0%, margins compressing to 8.9%, and a future P/E of 13.2x.

What The Millicom Evidence Actually Tested

The full Coltel acquisition and consolidation gave Millicom International Cellular the scale the bullish case wanted, and Q3 2026 revenue of US$2.28b versus US$1.42b a year earlier backed that top line argument. Profit told a different story. Net income dropped from US$194m to US$98m and net margin fell from 13.7% to 4.3%, so the period cut both ways.

The key lesson is simple. When a thesis hinges on healthier margins, as it did here, do not stop at revenue growth. Track net income and net margin together to see whether integration and expansion are actually turning into the cash and profitability the story assumes.

What Millicom International Cellular's 85% Run Now Asks You To Believe

Millicom International Cellular trades at US$83.24 today, and the selected Narrative places its Fair Value below that level rather than above it. After an 85.4% gain over the past year, the debate has shifted to how durable recent efficiency and cash flow trends really are.

The Narrative focuses on whether Ecuador and Guatemala issues could eat into those gains. For today’s price to hold up, a buyer would need to believe Millicom International Cellular can keep high EBITDA margins and solid equity free cash flow while absorbing legal, governance and brand spending pressures.

"Key Takeaways: Bearish analysts expect Millicom International Cellular to see its margins and cash generation come under pressure as legal risks, regulatory setbacks and higher marketing spend in markets like Ecuador absorb much of the recent operational gains. The main thing that has to go right is that Millicom International Cellular needs to keep translating its efficiency culture and M&A playbook into sustained high EBITDA margins and strong equity free cash flow while managing ongoing legal and governance challenges."

The price and this Narrative do not agree. → Uncover what this Narrative says Millicom International Cellular is actually worth

Looking One Step Beyond Millicom

Watching Millicom’s Latin American push, you might wonder what supports similar connectivity bets elsewhere.

Telecom groups investing heavily in mobile data often face a parallel challenge. They need fixed broadband and high speed lines to keep customers on richer service bundles.

Another large operator is leaning on fiber buildouts and upgraded wireless networks to deepen those recurring relationships.

Its push to replace older infrastructure and simplify networks targets lower running costs and cleaner margins over time.

If that shift toward converged connections works, your Millicom thesis might sit inside a much broader connectivity story.

It is written up in full, assumptions and all. → Explore the Narrative that puts this company 28% above its price

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com