Televisa (TV.US): Mobile Re-Entry Via Purchase of 50% of AT&T Mexico; Low Price, But We Are Cautious on the Outlook

J.P. Morgan remains Neutral on Televisa (TV.US). Televisa announced its re-entry into the Mexican mobile market through the acquisition of AT&T Mexico in a 50/50 JV with Fintech, for a total enterprise value of $2bn, financed in part by debt which should be non-recourse to Televisa. Valuation-wise, we find the price fairly undemanding, at ~2x EV/EBITDA'27E and ~3x OpFCF'27E. Strategic-wise, we are more cautious, as the Mexican mobile market is a tough one for smaller players, with leading company Telcel operating at high margins and offering a good level of quality, and we believe investors will likely want to see positive results first before incorporating any value. AT&T is the second largest mobile operator in Mexico with 24.7m subscribers (17% share) as of Dec-25 in a four-player market, where AMX/Telcel leads with 56% share, Telefonica holds 15% and Walmex-controlled MVNO Bait has 9%. The company had 19% EBITDA margin and 12% OpFCF margin in 2025 under US GAAP. Televisa already tr