Wednesday, April 27, 2016

AT&T: More Signs The Rally Is Over

AT&T easily slid past analyst EPS estimates that failed to incorporate merger benefits.
The wireless giant saw a few negative trends surface that might cap future growth.
The stock is likely to plateau at the current level where shareholders collect a 5% dividend yield while waiting for the next catalyst.
Q1 results from AT&T (NYSE:T) back up my investment thesis that the company would continue to push EPS towards $3 on the backs of the DirecTV merger. The theory back when the stock traded around $32 throughout 2014 and most of 2015 was that the stock was extremely cheap with plenty of catalysts. Now with AT&T trading at $38, the valuation equation isn't as clear with user growth slowing and synergies somewhat in place.
Read the full article on Seeking Alpha.

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