Opinions
Gordon Reid
A T & T US
T-N
COMMENT
Apr 30, 2014
Stock price when the opinion was issued
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Premium contentAT&T Inc. is an American multinational telecommunications holding company headquartered at Whitacre Tower in Downtown Dallas, Texas. It is the worlds third-largest telecommunications company by revenue and the third-largest provider of mobile telephone services in the U.S. Social media mentions are up 50% in the past 24h.
Improved since fall 2023. 6.5% dividend yield, attractive, pretty secure. Price broke above 200-day MA. With yields falling, dividend stocks are more appealing. Seems to have bottomed, as long as rates stay stable or continue to fall. Total return, though, is not tremendous. Cheap, but only 2% earnings growth expected, and he likes double-digits.
Premium contentAT&T Inc. is an American multinational telecommunications holding company headquartered at Whitacre Tower in Downtown Dallas, Texas. It is the worlds third-largest telecommunications company by revenue and the third-largest provider of mobile telephone services in the U.S. Social media mentions are up 100% in the past 24h.
The wireline business is more difficult to build out and AT&T has a big presence in that area in the U.S He prefers Canada over the U.S. which is more competitive. He prefers BCE which already has a large wireline footprint and can bundle it with wireless. BCE raised its dividend by 3% a while ago and he has concerns over the payout ratio being more than 100%. However he thinks the dividend is sustainable.
Seeing resilience in the stock price right now. Fundamentals are hard to determine. Lots of mistakes in company management in the past. Pricing power not great. Could be a good dividend investment, but hard to justify when compared to other options in the markets. Overall, would not recommend investing.
Equal weight on AT&T (T-N), Verizon (VZ-N) and Vodafone (VOD-Q) as a dividend play? If looking for dividend income, why not take advantage of the dividend tax credit that is offered on Canadian dividends? Although you get a dividend on these, from a tax standpoint it is treated as interest. As far as the telcos in the US are concerned, is that they distribute a lot of cash which generally run at the 4%-5% rate. AT&T is a slower grower. Of these 3, his favourite would probably be Verizon.