AT&T INC (1T.MI) Stock Fundamental Analysis
Europe - Euronext Milan - BIT:1T - US00206R1023 - Common Stock
20.165 EUR
-0.28 (-1.35%)
1T gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 35 industry peers in the Diversified Telecommunication Services industry. 1T has only an average score on both its financial health and profitability. 1T has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
- 1T had positive earnings in the past year.
- In the past year 1T had a positive cash flow from operations.
- In multiple years 1T reported negative net income over the last 5 years.
- Each year in the past 5 years 1T had a positive operating cash flow.
1.2 Ratios
- With a decent Return On Assets value of 5.24%, 1T is doing good in the industry, outperforming 74.29% of the companies in the same industry.
- With a decent Return On Equity value of 20.02%, 1T is doing good in the industry, outperforming 77.14% of the companies in the same industry.
- Looking at the Return On Invested Capital, with a value of 4.98%, 1T is doing worse than 68.57% of the companies in the same industry.
- 1T had an Average Return On Invested Capital over the past 3 years of 5.19%. This is below the industry average of 8.42%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.24% | ||
| ROE | 20.02% | ||
| ROIC | 4.98% |
ROA(3y)1.35%
ROA(5y)1.32%
ROE(3y)5.03%
ROE(5y)4.74%
ROIC(3y)5.19%
ROIC(5y)4.76%
1.3 Margins
- 1T's Profit Margin of 17.81% is amongst the best of the industry. 1T outperforms 88.57% of its industry peers.
- 1T's Profit Margin has improved in the last couple of years.
- With a decent Operating Margin value of 19.44%, 1T is doing good in the industry, outperforming 65.71% of the companies in the same industry.
- In the last couple of years the Operating Margin of 1T has grown nicely.
- 1T has a Gross Margin (59.67%) which is in line with its industry peers.
- 1T's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.44% | ||
| PM (TTM) | 17.81% | ||
| GM | 59.67% |
OM growth 3Y0.54%
OM growth 5Y4.03%
PM growth 3Y-16.01%
PM growth 5Y2.75%
GM growth 3Y2.85%
GM growth 5Y2.22%
2. Health
2.1 Basic Checks
- 1T has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
- The number of shares outstanding for 1T has been increased compared to 1 year ago.
- Compared to 5 years ago, 1T has less shares outstanding
- Compared to 1 year ago, 1T has an improved debt to assets ratio.
2.2 Solvency
- 1T has an Altman-Z score of 0.85. This is a bad value and indicates that 1T is not financially healthy and even has some risk of bankruptcy.
- Looking at the Altman-Z score, with a value of 0.85, 1T is doing worse than 68.57% of the companies in the same industry.
- The Debt to FCF ratio of 1T is 6.99, which is on the high side as it means it would take 1T, 6.99 years of fcf income to pay off all of its debts.
- The Debt to FCF ratio of 1T (6.99) is better than 62.86% of its industry peers.
- 1T has a Debt/Equity ratio of 1.16. This is a high value indicating a heavy dependency on external financing.
- 1T has a Debt to Equity ratio of 1.16. This is comparable to the rest of the industry: 1T outperforms 51.43% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.16 | ||
| Debt/FCF | 6.99 | ||
| Altman-Z | 0.85 |
ROIC/WACC0.75
WACC6.63%
2.3 Liquidity
- 1T has a Current Ratio of 1.01. This is a normal value and indicates that 1T is financially healthy and should not expect problems in meeting its short term obligations.
- The Current ratio of 1T (1.01) is better than 85.71% of its industry peers.
- 1T has a Quick Ratio of 1.01. This is a bad value and indicates that 1T is not financially healthy enough and could expect problems in meeting its short term obligations.
- 1T has a Quick ratio of 0.96. This is amongst the best in the industry. 1T outperforms 82.86% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.01 | ||
| Quick Ratio | 0.96 |
3. Growth
3.1 Past
- The earnings per share for 1T have decreased by -5.75% in the last year.
- Measured over the past years, 1T shows a decrease in Earnings Per Share. The EPS has been decreasing by -8.79% on average per year.
- The Revenue has been growing slightly by 1.98% in the past year.
- Measured over the past years, 1T shows a decrease in Revenue. The Revenue has been decreasing by -7.56% on average per year.
EPS 1Y (TTM)-5.75%
EPS 3Y-12.73%
EPS 5Y-8.79%
EPS Q2Q%-10%
Revenue 1Y (TTM)1.98%
Revenue growth 3Y-3%
Revenue growth 5Y-7.56%
Sales Q2Q%1.64%
3.2 Future
- 1T is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.70% yearly.
- The Revenue is expected to grow by 2.26% on average over the next years.
EPS Next Y-7.49%
EPS Next 2Y-0.05%
EPS Next 3Y3.36%
EPS Next 5Y5.7%
Revenue Next Year2.35%
Revenue Next 2Y1.92%
Revenue Next 3Y1.88%
Revenue Next 5Y2.26%
3.3 Evolution
- The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
- When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- A Price/Earnings ratio of 11.14 indicates a reasonable valuation of 1T.
- 1T's Price/Earnings ratio is a bit cheaper when compared to the industry. 1T is cheaper than 74.29% of the companies in the same industry.
- 1T is valuated cheaply when we compare the Price/Earnings ratio to 27.21, which is the current average of the S&P500 Index.
- Based on the Price/Forward Earnings ratio of 10.49, the valuation of 1T can be described as reasonable.
- 71.43% of the companies in the same industry are more expensive than 1T, based on the Price/Forward Earnings ratio.
- 1T is valuated cheaply when we compare the Price/Forward Earnings ratio to 25.98, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.14 | ||
| Fwd PE | 10.49 |
4.2 Price Multiples
- 1T's Enterprise Value to EBITDA is on the same level as the industry average.
- Compared to the rest of the industry, the Price/Free Cash Flow ratio of 1T indicates a somewhat cheap valuation: 1T is cheaper than 74.29% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.41 | ||
| EV/EBITDA | 6.33 |
4.3 Compensation for Growth
- 1T has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-0.05%
EPS Next 3Y3.36%
5. Dividend
5.1 Amount
- 1T has a Yearly Dividend Yield of 4.71%, which is a nice return.
- 1T's Dividend Yield is a higher than the industry average which is at 3.26.
- 1T's Dividend Yield is rather good when compared to the S&P500 average which is at 1.81.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.71% |
5.2 History
- The dividend of 1T decreases each year by -10.97%.
Dividend Growth(5Y)-10.97%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
- 1T pays out 37.01% of its income as dividend. This is a sustainable payout ratio.
DP37.01%
EPS Next 2Y-0.05%
EPS Next 3Y3.36%
AT&T INC / 1T.MI FAQ
What is the ChartMill fundamental rating of AT&T INC (1T.MI) stock?
ChartMill assigns a fundamental rating of 5 / 10 to 1T.MI.
What is the valuation status for 1T stock?
ChartMill assigns a valuation rating of 6 / 10 to AT&T INC (1T.MI). This can be considered as Fairly Valued.
How profitable is AT&T INC (1T.MI) stock?
AT&T INC (1T.MI) has a profitability rating of 6 / 10.
What is the valuation of AT&T INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for AT&T INC (1T.MI) is 11.14 and the Price/Book (PB) ratio is 1.52.
How financially healthy is AT&T INC?
The financial health rating of AT&T INC (1T.MI) is 4 / 10.