The telecom giant might have found a solution for its struggling satellite business. The company and its partner in the venture are apparently in talks to merge it with a peer.
T appears to be treading in the middle of the road and investors could be better off if they trade with caution.
AT&T Inc and joint-venture partner TPG Inc are in talks to combine their DirecTV service with Dish , Bloomberg News reported on Friday, citing people familiar with the matter.
Seeking Alpha's quant analysis rates AT&T at hold, with strong valuation, profitability, and momentum ratings, but poor growth and revisions ratings. AT&T's valuation is favorable with P/E, price/cash flow, and price/sales ratios trending upward over the past year. Despite declining revenues, AT&T shows strong momentum with its price above key moving averages, indicating positive investor sentiment.
AT&T has struggled since its 2021 dividend cut, falling 27% by July 2023 when it hit a 28-year low. Since that low, when it traded at 5X earnings and a nearly 9% yield, it's rallied 67%. AT&T's strong rally has virtually eliminated any excess short-term return potential. Analysts think it might deliver 11% returns, underperforming the S&P through 2026.
Apple is slowly introducing new AI features with its latest iPhones. While these features could drive increased upgrades, giving wireless customers opportunities to switch providers, AT&T isn't worried.
AT&T Inc. (NYSE:T ) Goldman Sachs Communacopia + Technology Conference September 10, 2024 11:10 AM ET Company Participants John Stankey - Chief Executive Officer Conference Call Participants Jim Schneider - Goldman Sachs Jim Schneider Very good. So welcome everybody to this session of the Goldman Sachs Communacopia and Technology Conference.
AT&T is one of America's oldest companies, with a history dating back to the 19th century. The company's generous dividend payments make it an attractive choice for income-oriented investors, but it has cut its dividend in the not-so-distant past.
AT&T's 2024 share performance has been strong and cash secured put options offer an alternative income strategy at its 52-week high. Despite revenue challenges, AT&T has managed expenses well, leading to a slight decline in operating income and a significant reduction in debt. The transformation from wireline to fiber is progressing, with substantial growth in fiber customers and revenue, supporting future earnings and free cash flow.
T's robust dividend investment thesis is supported by stable profitability, rich yields, and strong FY2024 FCF guidance, making it a solid telecom/dividend stock. The stock's impressive YTD returns are driven by the Fed's impending rate cuts and market rotation towards high-yield dividend stocks. T's improved balance sheet and increased cross-selling efforts enhance its dividend safety and growth potential, justifying our reiterated Buy rating.
Shares of AT&T have rallied sharply amid an improving financial outlook and solid operating trends. Positive free cash flow and an improving balance sheet support the stock's sizable 5.4% dividend yield.
Shares of AT&T have risen sharply this year but they still pay a dividend yield that is way above average. September is a generally lousy month for the U.S. stock market.