America Movil is one of the dominant wireless providers in Latin America, has been rapidly growing, and appears to be a decent capital allocator with a 6-year average return on investment of 16.7%. In other words, it looks like a promising company to own.

Over the last 3-4 years, capex spending has slowed and the cash has really been cranking in. Using TTM free cash flow (FCF), the company looks really cheap, priced to grow somewhere less than 10% per year. My big question is: can we project the recent slowing in capex spending forward in to the future?

My intuition says the answer is "no" to that question, as I would expect the advent of some new technology to force AMX to increase capex, if only to stay competitive. This is a really important question, because, if I normalize FCF by using a capex number that is the long-run (~10 yrs) average (as a percentage of revenue) in my DCF, AMX looks to be fairly valued a best.

I'll have to do some more research before I make any portfolio moves. Anyone have any insight into this issue?