3 Reasons to Own AT&T Now

AT&T:  The stock you either love or love to hate.

On one hand, it is a dividend aristocrat sporting a 7% plus yield raising their dividend every year for the last 36 years.

And at the same time the promise of a break-out telecom growth play whose stock price has gone nowhere for 20 years.

Value play? Technology failure? Management malpractice? Poor investment?

It’s probably somewhere in between … but change may finally be coming to this perpetual income stock teaser.

AT&T is a 5G spectrum winner … major fiber optic player … serious content programming competitor … finally getting some love from Wall Street.

3 reasons to own AT&T now

 

AT&T (NYSE: T) stock has long been considered an investor favorite for its versatile business and high dividend yield.

As one of the largest communication companies in the world, AT&T’s highly diversified business model which includes broadband, mobility, and media segments makes the stock a great play during periods of volatility. Investors are largely bullish on this high-growth stock for a couple of reasons:

  • AT&T and Verizon are leading the 5G trend as both companies look to build out a nationwide network. AT&T expects to add 3 million 5G customers this year.
  • AT&T is also a major player in the fiber optic network marketplace. As Americans continue to work from home this will be a major revenue generator
  • Programming with HBO Max has been a huge success for the company. This year AT&T is expected to roll out the service in 60 markets in Europe and Latin America

These trends make AT&T stock a great play for value and income investors. But the company’s biggest attraction is its dividend yield. AT&T stock offers a 7% dividend yield and has a history of 36 straight years of dividend increases.

If you are looking for a promising  play, here are 3 reasons to get your hands on AT&T stock:

A thriving media business

Like many other companies, AT&T was negatively impacted by the pandemic. The telecom giant’s share price declined as it issued debt to finance its investments. However, it is expected to offload this debt and focus on its high-margin segments.

To this effect, the company announced that its subsidiary, Direct TV will now be a standalone company in partnership with TPG Capital. AT&T will only own 70% of the company. This new deal will give the company $7.6 million in cash. News of this spinoff has analysts taking a more optimistic view of the stock.

Adding to this, AT&T’s HBO Max is capitalizing on a greater share of the streaming market. Once an underdog to industry giants like Disney (DIS) and Netflix (NFLX), HBO is now seeing greater demand for its streaming service. As the platform rolls out in 60 global markets this year, AT&T anticipates its audience size for HBO Max will increase by 67 million to 70 million by the end of 2021. Warner Bros. also announced that films slated for release in 2021 will premiere in theatres and on HBO concurrently.

With a thriving media business on its hands, I think AT&T stock has plenty of upside opportunity in the coming months.

5G market opportunity

 

As the nationwide rollout of 5G continues, AT&T looks to be among the prime beneficiaries. An upgrade to wireless technology speeds will help the company further its in-house products. AT&T earns a majority of its revenue from its wireless technology such as fiber optic and VDSL. So with the 5G market slowly but surely taking shape, AT&T is set to see a lot of positives in its core business.

In its fourth quarter, revenue in the mobility segment spiked 7.6% and total annual revenue amounted to $171.8 billion. Looking ahead, AT&T hopes to add 3 million customer locations to its existing 14 million. Given the market opportunity that exists in 5G, analysts remain optimistic about its future prospects. Analyst Bryan Kroft of Deutsche Bank gave the company a favorable rating for the attractive outlook of its core wireless business.

A healthy dividend

AT&T’s biggest attraction is its healthy dividend payout. With a 7% yield, the company earned the title of Dividend Aristocrat for its history of consistent dividend increases over 36 years. Management at the company is committed to paying the higher dividend and has managed debt flow successfully to hold the dividend increases. On April 8, AT&T declared a $0.52 per share dividend.

In addition to its attractive yield, AT&T stock is also trading at a low valuation. At its current price, it has a P/E ratio of 9.52 compared to the industry average P/E of 35.47. This is a sign that AT&T is trading at a discount. And with plenty of room to go higher in the future, it would be wise to get in while prices remain low.

AT&T is a defensive play for its infrastructure implications and non-tech focus. With a highly diversified business model, this stock is a great play, especially if we hit a rough patch in the upcoming months.

The Top Reasons to Invest in the Dogs of the Dow Every Year

The Top Reasons to Invest in the Dogs of the Dow Every Year

Ian Cooper
On December 22, 2021

One of the top year-end strategies to consider is the Dogs of the Dow.

Not only does the strategy allow you to potentially profit from down and out Dow stocks, it allows you to collect respectable dividends, too.

Three Top Ways to Trade Excessive Market Volatility

Three Top Ways to Trade Excessive Market Volatility

Ian Cooper
On December 20, 2021

Three Top Ways to Trade Excessive Market Volatility More Articles There’s a good deal of fear in the market.At the moment, the Dow is down 646 points, as the NASDAQ sinks 241.All thanks to the

The Top 3 Ways to Make Money with Higher Inflation

The Top 3 Ways to Make Money with Higher Inflation

Ian Cooper
On December 12, 2021

Higher inflation has been rough on us allWhile there’s hope inflation will cool, we have to contend with consumer prices we haven’t seen in about 39 years.  According to the Labor Department, CPI jumped 6.8%

Boom Goes Electric Vehicle Stocks

Boom Goes Electric Vehicle Stocks

Ian Cooper
On November 17, 2021

Boom Goes Electric Vehicle Stocks More Articles  Electric vehicle stocks are booming just as gas prices are ticking higher.You’ve watched shares of Tesla (NASDAQ: TSLA) rocket from a low of $100 to $1,228 over the

3 Top Oil Stocks that Pay a Safe 4%+ Dividend Yield

3 Top Oil Stocks that Pay a Safe 4%+ Dividend Yield

Ian Cooper
On November 7, 2021

More Articles One of the top year-end strategies to consider is the Dogs of the Dow.Not only does the strategy allow you to potentially profit from down and out Dow stocks, it allows you to

One of These Food Stocks Could Pay You a 6.5% Dividend

One of These Food Stocks Could Pay You a 6.5% Dividend

Ian Cooper
On October 29, 2021

More Articles If you’ve been to the grocery store lately, you’ve watched food prices explode higher.Beef, milk, vegetables, snacks, you name it. What used to cost me $120, now costs closer to $180. All as

3 Top Dividend Stocks to Own Now

3 Top Dividend Stocks to Own Now

Ian Cooper
On October 22, 2021

More Articles One of the best ways to build passive income is with dividend stocks.There is nothing like collecting a monthly or quarterly dividend check along with stock appreciation.In fact, find a stable company with

Sell These 3 Overvalued Dividend Stocks Now

Sell These 3 Overvalued Dividend Stocks Now

Dave Durham
On October 4, 2021

More Articles There are a lot of overvalued dividend stocks out there.Time to wisely kick a few stocks out of your portfolio.While the uninformed focus on equity markets potentially being a bubble, the most obvious

Collect a Triple Dividend

Collect a Triple Dividend

Dave Durham
On September 21, 2021

More Articles How would you like to collect a double, triple, even QUADRUPLE dividend from SAFE, fundamentally sound companies?Believe it or not, there are a number of relatively secure dividend plays out there – fundamentally

3 Stocks to Beat Inflation

3 Stocks to Beat Inflation

Dave Durham
On May 24, 2021

More Articles Inflation? Deflation? Where are we? There has been a lot of talk in the markets about inflation lately.Certain food prices are 30% to 50% higher than a year agoCommodity prices like corn, lumber and

PREV NEXT

Contact

267 Kentlands Blvd #225
Gaithersburg, MD 20878

P. (866) 257-3008
(Monday-Friday 9:00 AM-5:00 PM EST)

E. [email protected]

Products

Other Brands

About

Traders Reserve LLC is a “boutique” publisher of actionable, personal solutions for wealth-building, business growth and health/wellness through high-quality education, training, mentoring and other products and services.

Receive the latest news

Subscribe To Our Weekly Newsletter

Get notified about new articles, special events, training, and much more