AT&T (T – Research Report), the Communication Services sector company, was revisited by a Wall Street analyst yesterday. Analyst Michael Rollins from Citi maintained a Buy rating on the stock and has a $20.00 price target.
Michael Rollins has given his Buy rating due to a combination of factors that indicate AT&T’s solid financial performance and future growth potential. His confidence is rooted in AT&T’s first quarter results for 2024, which showed a strong start to EBITDA growth at 4.3% year over year. This performance suggests the company is well-positioned to meet or potentially exceed Rollins’ revised full-year growth forecast of 3.3%. Furthermore, AT&T’s ability to manage various aspects of their business, such as maintaining modest revenue growth, margin expansion, and generating favorable free cash flow, underpins the Buy recommendation.
Additionally, Rollins points to AT&T’s strategic capital allocation plans. Once the company achieves its net debt leverage target by mid-2025, it will have the financial flexibility to potentially invest in opportunities with solid returns, which could sustain revenue growth and improve EBITDA. Rollins also anticipates that the company’s potential modest dividend growth and share buybacks in the future will be well-received by investors. These factors, combined with the positive signals from the wireless industry such as lower churn and upgrade rates, as well as solid phone volume growth, contribute to Rollins’ positive outlook and Buy rating for AT&T stock.
In another report released yesterday, Bank of America Securities also reiterated a Buy rating on the stock with a $20.00 price target.
T’s price has also changed slightly for the past six months – from $15.190 to $16.580, which is a 9.15% increase.
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AT&T (T) Company Description:
AT&T, Inc. is a holding company, which engages in the provision of telecommunications media and technology service. It operates through the following segments: Communications, WarnerMedia, Latin America and Xandr. The Communications segment provides services to businesses and consumers located in the U.S., or in U.S. territories, and businesses globally. The WarnerMedia segment develops, produces and distributes feature films, television, gaming and other content over various physical and digital formats. The Latin America segment provides entertainment and wireless services outside of the U.S. The Xandar segment provides advertising services. The company was founded in 1983 and is headquartered in Dallas, TX.
