On July 19, 2023, AT&T Inc (T, Financial) witnessed a significant price change of 8.48%, bringing the stock price to $14.59. The company's market capitalization stands at $104.3 billion, with total sales amounting to $121.2 billion. The GF Value, a unique indicator of the stock's intrinsic worth, is estimated at $15.2, suggesting that AT&T (T) is fairly valued.
AT&T is a leading player in the telecommunications industry, with the wireless segment contributing approximately two-thirds of its revenue. The firm is the third-largest U.S. wireless carrier, connecting 70 million postpaid and 18 million prepaid phone customers. It also offers fixed-line enterprise services, residential fixed-line services, and has a significant presence in Mexico. Despite spinning off WarnerMedia, AT&T still holds a 70% equity stake in satellite television provider DirecTV.
GF Value of AT&T Inc (T, Financial)
The GF Value of AT&T (T) is calculated based on historical trading multiples, an adjustment factor from GuruFocus based on past performance and growth, and estimates of future business performance. The current stock price of $14.59 per share suggests that AT&T is fairly valued, indicating that the long-term return of its stock is likely to be close to its business growth rate.
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Financial Strength of AT&T Inc (T, Financial)
Before investing in a company, it's crucial to assess its financial strength. AT&T's cash-to-debt ratio is 0.02, which is lower than 93.45% of companies in the Telecommunication Services industry, indicating a weak financial position. The overall financial strength of AT&T is rated 3 out of 10 by GuruFocus.
Profitability of AT&T Inc (T, Financial)
Investing in profitable companies carries less risk. AT&T has been profitable 8 years over the past 10 years and has an operating margin of 19.29%, better than 77.49% of companies in the Telecommunication Services industry. However, the company reported an EPS of $-1.27 over the past 12 months.
Growth of AT&T Inc (T, Financial)
AT&T's 3-year average annual revenue growth rate is -13.6%, ranking it lower than 88.19% of companies in the Telecommunication Services industry. The 3-year average EBITDA growth rate is -28.2%, which is worse than 91.92% of companies in the industry.
ROIC vs WACC of AT&T Inc (T, Financial)
Comparing the return on invested capital (ROIC) to the weighted cost of capital (WACC) is another way to evaluate a company’s profitability. Over the past 12 months, AT&T’s ROIC was 10.67, while its WACC came in at 4.82, indicating that the company is creating value for shareholders.
Conclusion
In conclusion, AT&T Inc (T, Financial) appears to be fairly valued. Despite its poor financial strength and average profitability, the company's growth ranks worse than 91.92% of companies in the Telecommunication Services industry. For more detailed financial information about AT&T, you can check out its 30-Year Financials here.
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