By Sam Boughedda
investment.com AT&T Inc (NYSE:T) was upgraded to “buy” with a price target of $24 per share by Argus analysts in a note to clients Thursday.
The company told investors that AT&T’s Mobility business was generating bottom line results, the company was rapidly expanding its next-generation 5G wireless network, and the company’s targeted debt reduction and refinancing in recent years l had made more resistant.
With WarnerMedia’s Discovery spin-off, AT&T finally left its long and dismal foray into the media business. The company has also made multiple other asset disposals and a substantial cut in dividends over the past year. Capital expenditures in 5G and fiber broadband networks, in addition to debt reduction, are their key near-term strategic priorities, with a view to creating the underlying framework for long-term sustainable growth.” , wrote Argus.
They added that AT&T’s wireless business has been “a star in 2022,” with the company adding substantial subscriber numbers despite rising prices.
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Although it didn’t gain as many subscribers as industry leader T-Mobile (NASDAQ:TMUS), it did better than Verizon’s (NYSE:VZ) subscriber losses and anemic number. . The company gained traction in attracting wireless subscribers through last year’s promotions. Although management may be reducing promotions, mobile is still the main driver of revenue and profits for the company. The mobile phone business could withstand a downturn, given the value subscribers place on wireless connectivity, although a downturn would likely hurt its commercial enterprise business,” the company added.
AT&T shares have begun to recover from the setback suffered by the company in response to its strategic shift into the entertainment business, the WarnerMedia spin-off and the dividend cut, although the valuation remains below historical norms and the average of their counterparts. Although telecommunications companies are often viewed as safe havens in times of economic turmoil, in the case of AT&T, its debt reduction and refinancing in recent years has made it more resilient in the current macroeconomic environment. Our long-term rating is BUY,” they conclude.
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