GURUFOCUS.COM » STOCK LIST » Communication Services » Telecommunication Services » AT&T Inc (NYSE:T) » Definitions » Financial Strength

AT&T (T) Financial Strength

: 4 (As of Dec. 2023)
View and export this data going back to 1946. Start your Free Trial

AT&T has the Financial Strength Rank of 4.

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors:

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.
2. Debt to revenue ratio. The lower, the better.
3. Altman Z-Score.

AT&T's Interest Coverage for the quarter that ended in Dec. 2023 was 3.40. AT&T's debt to revenue ratio for the quarter that ended in Dec. 2023 was 1.21. As of today, AT&T's Altman Z-Score is 0.70.


Competitive Comparison

For the Telecom Services subindustry, AT&T's Financial Strength, along with its competitors' market caps and Financial Strength data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.


AT&T Financial Strength Distribution

For the Telecommunication Services industry and Communication Services sector, AT&T's Financial Strength distribution charts can be found below:

* The bar in red indicates where AT&T's Financial Strength falls into.



AT&T Financial Strength Calculation

GuruFocus Financial Strength Rank measures how strong a company's financial situation is. It is based on these factors

A company ranks high with financial strength is likely to withstand any business slowdowns and recessions.

1. The debt burden that the company has as measured by its Interest Coverage (current year). The higher, the better.

Note: If both Interest Expense and Interest Income are empty, while Net Interest Income is negative, then use Net Interest Income as Interest Expense.

Interest Coverage is a ratio that determines how easily a company can pay interest expenses on outstanding debt. It is calculated by dividing a company's Operating Income (EBIT) by its Interest Expense:

AT&T's Interest Expense for the months ended in Dec. 2023 was $-1,726 Mil. Its Operating Income for the months ended in Dec. 2023 was $5,860 Mil. And its Long-Term Debt & Capital Lease Obligation for the quarter that ended in Dec. 2023 was $145,422 Mil.

AT&T's Interest Coverage for the quarter that ended in Dec. 2023 is

Interest Coverage=-1*Operating Income (Q: Dec. 2023 )/Interest Expense (Q: Dec. 2023 )
=-1*5860/-1726
=3.40

The higher the ratio, the stronger the company's financial strength is.

2. Debt to revenue ratio. The lower, the better.

AT&T's Debt to Revenue Ratio for the quarter that ended in Dec. 2023 is

Debt to Revenue Ratio=Total Debt (Q: Dec. 2023 ) / Revenue
=(Short-Term Debt & Capital Lease Obligation + Long-Term Debt & Capital Lease Obligation) / Revenue
=(9477 + 145422) / 128088
=1.21

3. Altman Z-Score.

Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

The zones of discrimination were as such:

When Z-Score is less than 1.81, it is in Distress Zones.
When Z-Score is greater than 2.99, it is in Safe Zones.
When Z-Score is between 1.81 and 2.99, it is in Grey Zones.

AT&T has a Z-score of 0.70, indicating it is in Distress Zones. This implies bankrupcy possibility in the next two years.

Warning Sign:

Altman Z-score of 0.7 is in distress zone. This implies bankruptcy possibility in the next two years.

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.


AT&T  (NYSE:T) Financial Strength Explanation

The maximum rank is 10. Companies with rank 7 or higher will be unlikely to fall into distressed situations. Companies with rank of 3 or less are likely in financial distress.

AT&T has the Financial Strength Rank of 4.


AT&T Financial Strength Related Terms

Thank you for viewing the detailed overview of AT&T's Financial Strength provided by GuruFocus.com. Please click on the following links to see related term pages.


AT&T (T) Business Description

Address
208 S. Akard Street, Dallas, TX, USA, 75202
The wireless business contributes about two thirds of AT&T's revenue following the spinoff of Warner Media. The firm is the third-largest U.S. wireless carrier, connecting 70 million postpaid and 18 million prepaid phone customers. Fixed-line enterprise services, which account for about 18% of revenue, include internet access, private networking, security, voice, and wholesale network capacity. Residential fixed-line services, about 11% of revenue, primarily consist of broadband internet access service. AT&T also has a sizable presence in Mexico, serving 22 million customers, but this business only accounts for 3% of revenue. The firm still holds a 70% equity stake in satellite television provider DirecTV but does not consolidate this business in its financial statements.
Executives
Sanders S Sabrina officer: SVP-ChiefActngOfcr&Controller 208 S. AKARD ST., 29TH FLOOR, DALLAS TX 75202
Debra L. Dial officer: SVP-ChiefActngOfcr&Controller 208 S. AKARD, 29TH FLOOR, DALLAS TX 75202
Jeremy Alan Legg officer: Chief Technology Officer 208 S. AKARD STREET, DALLAS TX 75202
Kenny Kellyn Smith officer: Chief Marketing & Growth Ofcr 208 S. AKARD ST, 29TH FLOOR, DALLAS TX 75202
Edward W Gillespie officer: SrEVP-Ext & Legal Affairs 208 S. AKARD, DALLAS TX 75202
Angela Santone officer: Sr. Exec VP-Human Resources 208 S. AKARD ST, DALLAS TX 75202
Jeffery S. Mcelfresh officer: CEO, AT&T Communications, LLC 208 S. AKARD, 29TH FLOOR, DALLAS TX 75202
Mcatee David R Ii officer: Sr. Exec. VP and Gen. Counsel 208 S. AKARD, 29TH FLOOR, DALLAS TX 75202
David S. Huntley officer: SEVP&Chief Compliance Officer 208 S. AKARD, ROOM 2900;07, DALLAS TX 75202
Lori M Lee officer: CEO-AT&T LatAm&GlobalMktgOfcr 208 S. AKARD ST., 29TH FLOOR, DALLAS TX 75202
Pascal Desroches officer: Sr. Exec VP and CFO AT&T INC., 208 S AKARD STREET, DALLAS TX 75202
Stephen J Luczo director
Luis A Ubinas director 209 REDWOOD SHORES PARKWAY, REDWOOD CITY CA 94065-1175
John T Stankey officer: Sr. Exec. VP and CIO 208 S. AKARD ST., 29TH FLOOR, DALLAS TX 75202
Jason Kilar officer: CEO, Warner Media, LLC 208 S. AKARD ST, DALLAS TX 75202

AT&T (T) Headlines

From GuruFocus

AT&T Inc at Morgan Stanley TMT Conference Transcript

By GuruFocus Research 01-23-2024

AT&T Inc Annual Shareholders Meeting Transcript

By GuruFocus Research 01-23-2024

Q4 2022 AT&T Inc Earnings Call Transcript

By GuruFocus Research 01-23-2024

Q3 2022 AT&T Inc Earnings Call Transcript

By GuruFocus Research 01-23-2024

Q3 2023 AT&T Inc Earnings Call Transcript

By GuruFocus Research 01-23-2024

AT&T Inc Annual Shareholders Meeting Transcript

By GuruFocus Research 01-23-2024