Investing.com -- Raymond James raised its rating for T-Mobile to Outperform from Market Perform on Monday ahead of third-quarter results, saying concerns about competition from SpaceX have been overdone.

Analyst Frank Louthan set a $170 price target, based on about nine times his 2027 price to free cash flow estimate and seven times enterprise value to EBITDA. That compares with roughly seven and six times for the large-cap telecom group.

“We believe the recent fears over competition from SpaceX are overblown, as they are 3+ years away from becoming reality, and competition from larger players is nothing new to T-Mobile,” Louthan wrote, calling the recent pullback a buying opportunity.

He argued that owning spectrum and building a reliable mobile network that meets consumer expectations are two different things. The established carriers, which he now counts T-Mobile among, hold significant advantages in spectrum and terrestrial network capability.

Louthan acknowledged SpaceX’s technical capabilities but said significant time and spectrum hurdles remain. He noted that a 5-megahertz channel in each direction of low-band spectrum is an improvement for SpaceX, but remains limited next to the capacity incumbents hold across multiple low-band holdings.

The analyst said T-Mobile still trades more expensively than peers, and that its converged strategy has limitations given its reliance on fixed wireless and a smaller fiber footprint over the longer term. However, he said stronger subscriber growth and depressed sector multiples offset that.

Raymond James continues to expect T-Mobile to take market share overall.

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