AT&T INC (T)
US00206R1023 - Common Stock
Taking everything into account, T scores 4 out of 10 in our fundamental rating. T was compared to 34 industry peers in the Diversified Telecommunication Services industry. T scores excellent on profitability, but there are concerns on its financial health. T has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year T was profitable.
T had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: T reported negative net income in multiple years.
Each year in the past 5 years T had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 3.15%, T is in the better half of the industry, outperforming 78.79% of the companies in the same industry.
With an excellent Return On Equity value of 11.89%, T belongs to the best of the industry, outperforming 87.88% of the companies in the same industry.
With a decent Return On Invested Capital value of 5.43%, T is doing good in the industry, outperforming 75.76% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for T is in line with the industry average of 5.42%.
The last Return On Invested Capital (5.43%) for T is above the 3 year average (5.09%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.15% | ||
| ROE | 11.89% | ||
| ROIC | 5.43% |
ROA(3y)1.64%
ROA(5y)1.28%
ROE(3y)5.58%
ROE(5y)4.19%
ROIC(3y)5.09%
ROIC(5y)4.8%
1.3 Margins
Looking at the Profit Margin, with a value of 10.25%, T belongs to the top of the industry, outperforming 84.85% of the companies in the same industry.
T's Profit Margin has been stable in the last couple of years.
T has a better Operating Margin (20.07%) than 78.79% of its industry peers.
T's Operating Margin has improved in the last couple of years.
With a decent Gross Margin value of 59.61%, T is doing good in the industry, outperforming 60.61% of the companies in the same industry.
In the last couple of years the Gross Margin of T has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 20.07% | ||
| PM (TTM) | 10.25% | ||
| GM | 59.61% |
OM growth 3Y7.62%
OM growth 5Y5.58%
PM growth 3YN/A
PM growth 5Y0.43%
GM growth 3Y2.96%
GM growth 5Y2%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so T is destroying value.
The number of shares outstanding for T has been increased compared to 1 year ago.
T has less shares outstanding than it did 5 years ago.
The debt/assets ratio for T has remained at the same level compared to a year ago.
2.2 Solvency
T has an Altman-Z score of 0.80. This is a bad value and indicates that T is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of T (0.80) is worse than 60.61% of its industry peers.
The Debt to FCF ratio of T is 6.22, which is on the high side as it means it would take T, 6.22 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 6.22, T belongs to the top of the industry, outperforming 81.82% of the companies in the same industry.
T has a Debt/Equity ratio of 1.19. This is a high value indicating a heavy dependency on external financing.
T's Debt to Equity ratio of 1.19 is in line compared to the rest of the industry. T outperforms 51.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.19 | ||
| Debt/FCF | 6.22 | ||
| Altman-Z | 0.8 |
ROIC/WACC0.78
WACC6.95%
2.3 Liquidity
T has a Current Ratio of 0.70. This is a bad value and indicates that T is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of T (0.70) is worse than 75.76% of its industry peers.
A Quick Ratio of 0.66 indicates that T may have some problems paying its short term obligations.
T has a worse Quick ratio (0.66) than 78.79% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.66 |
3. Growth
3.1 Past
The earnings per share for T have decreased by -8.87% in the last year.
The Earnings Per Share has been decreasing by -7.30% on average over the past years.
The Revenue has been growing slightly by 0.26% in the past year.
The Revenue has been decreasing by -6.44% on average over the past years.
EPS 1Y (TTM)-8.87%
EPS 3Y-8.83%
EPS 5Y-7.3%
EPS Q2Q%-6.25%
Revenue 1Y (TTM)0.26%
Revenue growth 3Y-5.06%
Revenue growth 5Y-6.44%
Sales Q2Q%-0.45%
3.2 Future
The Earnings Per Share is expected to grow by 1.89% on average over the next years.
T is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.40% yearly.
EPS Next Y-6.34%
EPS Next 2Y-2.67%
EPS Next 3Y-0.91%
EPS Next 5Y1.89%
Revenue Next Year0.24%
Revenue Next 2Y0.84%
Revenue Next 3Y1.01%
Revenue Next 5Y1.4%
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
With a Price/Earnings ratio of 10.07, the valuation of T can be described as very reasonable.
T's Price/Earnings ratio is rather cheap when compared to the industry. T is cheaper than 84.85% of the companies in the same industry.
T's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 27.73.
T is valuated reasonably with a Price/Forward Earnings ratio of 9.96.
90.91% of the companies in the same industry are more expensive than T, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of T to the average of the S&P500 Index (22.83), we can say T is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.07 | ||
| Fwd PE | 9.96 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, T is valued a bit cheaper than the industry average as 72.73% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, T is valued a bit cheaper than the industry average as 69.70% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.78 | ||
| EV/EBITDA | 6.56 |
4.3 Compensation for Growth
The decent profitability rating of T may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-2.67%
EPS Next 3Y-0.91%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.75%, T is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 5.23, T pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.34, T pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.75% |
5.2 History
The dividend of T decreases each year by -10.62%.
T has paid a dividend for at least 10 years, which is a reliable track record.
The dividend of T decreased recently.
Dividend Growth(5Y)-10.62%
Div Incr Years0
Div Non Decr Years1
5.3 Sustainability
65.27% of the earnings are spent on dividend by T. This is not a sustainable payout ratio.
DP65.27%
EPS Next 2Y-2.67%
EPS Next 3Y-0.91%
AT&T INC
NYSE:T (12/20/2024, 8:04:00 PM)
After market: 22.75 0 (0%)22.75
+0.18 (+0.8%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners60.96%
Inst Owner Change2.99%
Ins Owners0.1%
Ins Owner Change0.67%
Market Cap163.24B
Analysts74.29
Price Target23.59 (3.69%)
Short Float %1.71%
Short Ratio3.57
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.75% |
Dividend Growth(5Y)-10.62%
DP65.27%
Div Incr Years0
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.93%
Min EPS beat(2)-2.25%
Max EPS beat(2)0.39%
EPS beat(4)2
Avg EPS beat(4)-1.34%
Min EPS beat(4)-4.82%
Max EPS beat(4)1.32%
EPS beat(8)6
Avg EPS beat(8)1.42%
EPS beat(12)9
Avg EPS beat(12)1.89%
EPS beat(16)12
Avg EPS beat(16)2.53%
Revenue beat(2)0
Avg Revenue beat(2)-2.97%
Min Revenue beat(2)-3.57%
Max Revenue beat(2)-2.37%
Revenue beat(4)0
Avg Revenue beat(4)-1.91%
Min Revenue beat(4)-3.57%
Max Revenue beat(4)-0.26%
Revenue beat(8)0
Avg Revenue beat(8)-1.93%
Revenue beat(12)0
Avg Revenue beat(12)-7.25%
Revenue beat(16)0
Avg Revenue beat(16)-11.58%
PT rev (1m)4.95%
PT rev (3m)9.41%
EPS NQ rev (1m)-0.18%
EPS NQ rev (3m)-0.47%
EPS NY rev (1m)0%
EPS NY rev (3m)0.53%
Revenue NQ rev (1m)-0.07%
Revenue NQ rev (3m)-0.15%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-0.44%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 10.07 | ||
| Fwd PE | 9.96 | ||
| P/S | 1.34 | ||
| P/FCF | 7.78 | ||
| P/OCF | 4.26 | ||
| P/B | 1.55 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.56 |
EPS(TTM)2.26
EY9.93%
EPS(NY)2.28
Fwd EY10.04%
FCF(TTM)2.93
FCFY12.86%
OCF(TTM)5.35
OCFY23.5%
SpS17.03
BVpS14.68
TBVpS-13.25
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.15% | ||
| ROE | 11.89% | ||
| ROCE | 6.9% | ||
| ROIC | 5.43% | ||
| ROICexc | 5.48% | ||
| ROICexgc | 12.69% | ||
| OM | 20.07% | ||
| PM (TTM) | 10.25% | ||
| GM | 59.61% | ||
| FCFM | 17.18% |
ROA(3y)1.64%
ROA(5y)1.28%
ROE(3y)5.58%
ROE(5y)4.19%
ROIC(3y)5.09%
ROIC(5y)4.8%
ROICexc(3y)5.23%
ROICexc(5y)4.92%
ROICexgc(3y)11.75%
ROICexgc(5y)11.95%
ROCE(3y)6.46%
ROCE(5y)6.09%
ROICexcg growth 3Y7.02%
ROICexcg growth 5Y-0.4%
ROICexc growth 3Y11.41%
ROICexc growth 5Y4.62%
OM growth 3Y7.62%
OM growth 5Y5.58%
PM growth 3YN/A
PM growth 5Y0.43%
GM growth 3Y2.96%
GM growth 5Y2%
F-Score8
Asset Turnover0.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.19 | ||
| Debt/FCF | 6.22 | ||
| Debt/EBITDA | 2.84 | ||
| Cap/Depr | 88.65% | ||
| Cap/Sales | 14.21% | ||
| Interest Coverage | 3.31 | ||
| Cash Conversion | 86.94% | ||
| Profit Quality | 167.64% | ||
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.66 | ||
| Altman-Z | 0.8 |
F-Score8
WACC6.95%
ROIC/WACC0.78
Cap/Depr(3y)97.02%
Cap/Depr(5y)85.03%
Cap/Sales(3y)14.14%
Cap/Sales(5y)12.69%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-8.87%
EPS 3Y-8.83%
EPS 5Y-7.3%
EPS Q2Q%-6.25%
EPS Next Y-6.34%
EPS Next 2Y-2.67%
EPS Next 3Y-0.91%
EPS Next 5Y1.89%
Revenue 1Y (TTM)0.26%
Revenue growth 3Y-5.06%
Revenue growth 5Y-6.44%
Sales Q2Q%-0.45%
Revenue Next Year0.24%
Revenue Next 2Y0.84%
Revenue Next 3Y1.01%
Revenue Next 5Y1.4%
EBIT growth 1Y1.31%
EBIT growth 3Y2.18%
EBIT growth 5Y-1.22%
EBIT Next Year83.22%
EBIT Next 3Y24.76%
EBIT Next 5Y15.65%
FCF growth 1Y37%
FCF growth 3Y-10.39%
FCF growth 5Y-2.18%
OCF growth 1Y17.08%
OCF growth 3Y-3.87%
OCF growth 5Y-2.55%