After years of 'conglomeratizing' (is that a word??) and turning itself into a combo phone, media, tech, content & communications company, T found itself being lots of things to lots of people but ultimately not being enough of anything to anyone! Couple that with tons of debt to pay for all that 'pac-man'ing of businesses and you get the AT&T of not too long ago that did a 180, announced a sale of key assets, a cut in their dividend and a return to what they know best: mobile phone communications.
Some time has passed since they ticked off Wall Street and many investors with an about-face that was not only not advertised but was in complete contradiction to what management had been saying right up until that point, and what we have now is a mobile phone company that is getting some pretty good press about progress in developing their 5G network, cutting costs and paying down debt.
Even with the dividend cut, T is still paying over 5% currently and seems to be generating ample cash flow to continue paying down debt and keeping the dividend in place. (Of course, 'buyer beware' definitely applies here, as does 'fool me once, your fault; fool me twice, mine!)
Bottom line?
I like T and am considering buying more.
The chart shows the recent runup in price, with shorter-date-moving-averages moving up and piercing, or about to, longer-date-ma's. That's good. What's not so good is the RSI which has been in overbought territory, and while off the highs, is still in a 'divergence' (ie: going down) with price action (going up). The momentum too, MACD, is fading.
All this on the heels of recent positive presentations by the company's COO and it's CFO on progress to date, including this paraphrased quote: "The company continues to see healthy customer growth in its strategic focus areas of 5G and fiber as customer demand for connectivity services remains high"
And an upgrade today by Argus from Hold to Buy.
I do like the direction that T has been taking and the progress they appear to be making in achieving their new goals. And I do think that as long as their 5+% dividend is maintained, there will be 'value' and 'dividend' investors who will be wooed back to an old favorite that had gone rogue for a while. This is especially likely if I'm correct that the overall economic picture will worsen into '23 and longer-term interest rates will stay where they are or decline further as inflation expectations continue to fall and recession expectations continue to rise.
But this is one where I'm going to yield to the technicals on the chart and wait for a pullback before adding.
As always, nothing written here whether explicitly or implied is meant to be advice in anyway! It's simply food for thought and discussion.
Comments welcome.
Some time has passed since they ticked off Wall Street and many investors with an about-face that was not only not advertised but was in complete contradiction to what management had been saying right up until that point, and what we have now is a mobile phone company that is getting some pretty good press about progress in developing their 5G network, cutting costs and paying down debt.
Even with the dividend cut, T is still paying over 5% currently and seems to be generating ample cash flow to continue paying down debt and keeping the dividend in place. (Of course, 'buyer beware' definitely applies here, as does 'fool me once, your fault; fool me twice, mine!)
Bottom line?
I like T and am considering buying more.
The chart shows the recent runup in price, with shorter-date-moving-averages moving up and piercing, or about to, longer-date-ma's. That's good. What's not so good is the RSI which has been in overbought territory, and while off the highs, is still in a 'divergence' (ie: going down) with price action (going up). The momentum too, MACD, is fading.
All this on the heels of recent positive presentations by the company's COO and it's CFO on progress to date, including this paraphrased quote: "The company continues to see healthy customer growth in its strategic focus areas of 5G and fiber as customer demand for connectivity services remains high"
And an upgrade today by Argus from Hold to Buy.
I do like the direction that T has been taking and the progress they appear to be making in achieving their new goals. And I do think that as long as their 5+% dividend is maintained, there will be 'value' and 'dividend' investors who will be wooed back to an old favorite that had gone rogue for a while. This is especially likely if I'm correct that the overall economic picture will worsen into '23 and longer-term interest rates will stay where they are or decline further as inflation expectations continue to fall and recession expectations continue to rise.
But this is one where I'm going to yield to the technicals on the chart and wait for a pullback before adding.
As always, nothing written here whether explicitly or implied is meant to be advice in anyway! It's simply food for thought and discussion.
Comments welcome.