Verizon (VZ 0.47%) and AT&T (T 1.16%) offer passive income investors a robust dividend yield.
T remains a compelling dividend investment due to the stable profitability, rich yields, and strong FCF guidance, despite the recent price appreciation. Even so, we believe that the market's optimism surrounding the DIRECTV divestiture has been well warranted, attributed to its leaner operations and intensified focus on the telecom business. T's core business shows excellent performance metrics as well, with the lower churn, consistent net adds, and increased service convergence supporting its excellent FY2024 guidance.
Besides improving financials and guidance as reported in its Q3, I also see other bullish indicators. AT&T stock has broken out key resistance levels recently and cleared more space for further price gain. Despite recent rallies, T stock remains attractively valued, especially when adjusted for growth and yield.
In the most recent trading session, AT&T (T) closed at $23.48, indicating a -0.14% shift from the previous trading day.
AT&T Inc. (NYSE:T ) UBS Global Media & Communications Conference December 9, 2024 8:15 PM ET Company Participants John Stankey - CEO Conference Call Participants John Hodulik - UBS John Hodulik Okay. We're going to get started here with Day 2 of the UBS Media and Telecom Conference.
Recently, Zacks.com users have been paying close attention to AT&T (T). This makes it worthwhile to examine what the stock has in store.
AT&T NYSE: T is a telecommunications giant with a rich history spanning over a century and AT&T finds itself at a pivotal point in history once again. From its origins as the Bell Telephone Company, through numerous mergers and acquisitions and the breakup of the "Ma Bell" monopoly, AT&T has continually evolved.
AT&T is focusing on substantial shareholder returns through fiber and 5G expansion, aiming for 50 million fiber locations and significant market penetration by 2029. The company plans $22 billion annual capital investment, targeting 3%+ annual adjusted EBITDA growth and $18 billion+ FCF by 2027. AT&T's shareholder return plan includes $20 billion in dividends and $20 billion in share repurchases, implying double-digit annualized returns.
High-yield dividend stocks often attract renewed attention when markets anticipate a shift in monetary policy. With the Federal Reserve signaling a potential long-term rate-cutting cycle in 2025 despite lingering inflation concerns, income-generating equities have moved into the spotlight in 2024.
AT&T's stock has surged 41.5% YTD, with a strong buy rating maintained due to promising financial and operational expectations from management. The company is healthier than ever, focusing on growing high cash flow segments and exiting legacy operations, enhancing future prospects. Significant investments in 5G and fiber have driven revenue growth, with management projecting substantial free cash flow and shareholder returns through 2027.
Coming off of the 2024 AT&T Analyst & Investor Day in Dallas, AT&T (T) CEO John Stankey sits down with Yahoo Finance executive editor Brian Sozzi to talk about the telecommunications company's earnings growth forecast and the chief executive's outlook on the incoming Trump administration. President-elect Donald Trump's new administration appears "very focused on trying to make sure that the economy performs well," Stankey says.
AT&T's 3-5 year plan continues its focus on 5G wireless and fiber broadband, generating 5-10% EPS growth and $1 billion/year free cash flow increases. The company aims to double fiber customers, switch to open wireless architecture, and phase out its costly copper network by 2029. AT&T plans $20 billion in share buybacks once it hits its debt target, but dividend growth is not a priority.