América Móvil Is Performing Well, but It Has Limited Shareholder Returns to Pursue Acquisitions
América Móvil holds a commanding position in several countries throughout Latin America. Significant political, regulatory, and economic uncertainty, coupled with occasional competitive flare-ups, limit its ability to exercise pricing power, but we expect Móvil’s scale and strong balance sheet will allow it to deliver steady results. The firm is now looking for new acquisition targets. We don't believe a transformative deal is likely, but we are wary that the firm will use its strong balance sheet to undertake a series of sizable transactions that could dilute its competitive position.