Per Market Realist...
Year-to-date, AT&T has fallen ~10% as of September 28. While this second-largest wireless provider has been posting higher earnings growth, its revenues are falling due to cord-cutting.
6 replies (most recent on top)
I Love It!
Keep calm.... layoffs are coming that will make the numbers look good again. You may not have a job but the stock will be ok. Time for the old move the chess pieces around and let people go. After all that is our Holiday lottery game. Ok Folks let’s see you try to find a job during Thanksgiving and Christmas time and be off our books by Jan1-15th. Gobble Gobble
Randy is full of Sh--.... I hope , and pray that he gets canned, before the next downturn
The floor statement has to do with a 6% + dividend and a $30 stock price.
If they cut the dividend, all bets are off. But, they raised the dividend, which provides some buffer against the Fed raising interest rates.
AT&T is strictly an income stock, like many utilities. It has a place in a portfolio that can use dividend income.
They have a lot of fat that they can cut to maintain that dividend if they need to, such as retiree health benefits and so forth.
Two years ago, July 2016, T was $43.89, today $33.92... In 1999, T was $59.88.... I love the "raising the dividend will put a floor on the stock price" statement - how funny is that? The only thing that will get the stock price going up, and stop the slide, is a reasonable chance for growing revenue. The market does not see that currently.
Stock is up a bit from the $30s, where I said it was a buy.
http://about.att.com/story/att_increases_quarterly_dividend_2_percent.html
They hiked the dividend again which puts a floor on that stock price. Who cares if the stock was previously up on some irrational exuberance?
The cord cutting might be offset with opportunities with the 5G. Those cord-cutters are going to want their video over the wireless and wired internet.
The problem is not with the cord cutting, but with the debt. They have to meet all debt cutting targets, and perhaps exceed them. And they still have bloated headcount numbers, so they need to perform well in the AI arena.