AT&T INC (T)
US00206R1023 - Common Stock
Taking everything into account, T scores 5 out of 10 in our fundamental rating. T was compared to 34 industry peers in the Diversified Telecommunication Services industry. While T belongs to the best of the industry regarding profitability, there are concerns on its financial health. T is valued quite cheap, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year T was profitable.
In the past year T had a positive cash flow from operations.
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
With a decent Return On Assets value of 3.15%, T is doing good in the industry, outperforming 79.41% of the companies in the same industry.
Looking at the Return On Equity, with a value of 11.89%, T belongs to the top of the industry, outperforming 91.18% of the companies in the same industry.
T has a Return On Invested Capital of 5.43%. This is in the better half of the industry: T outperforms 79.41% of its industry peers.
The Average Return On Invested Capital over the past 3 years for T is in line with the industry average of 6.13%.
The 3 year average ROIC (5.09%) for T is below the current ROIC(5.43%), indicating increased profibility in the last year.
| 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
T has a better Profit Margin (10.25%) than 85.29% of its industry peers.
T's Profit Margin has been stable in the last couple of years.
The Operating Margin of T (20.07%) is better than 79.41% of its industry peers.
T's Operating Margin has improved in the last couple of years.
T's Gross Margin of 59.61% is fine compared to the rest of the industry. T outperforms 61.76% of its industry peers.
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
T has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, T has more shares outstanding
The number of shares outstanding for T has been reduced compared to 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 0.78. This is a bad value and indicates that T is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 0.78, T is not doing good in the industry: 64.71% of the companies in the same industry are doing better.
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.
T has a better Debt to FCF ratio (6.22) than 82.35% of its industry peers.
T has a Debt/Equity ratio of 1.19. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.19, T perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.19 | ||
| Debt/FCF | 6.22 | ||
| Altman-Z | 0.78 |
ROIC/WACC0.85
WACC6.4%
2.3 Liquidity
A Current Ratio of 0.70 indicates that T may have some problems paying its short term obligations.
Looking at the Current ratio, with a value of 0.70, T is doing worse than 76.47% of the companies in the same industry.
A Quick Ratio of 0.66 indicates that T may have some problems paying its short term obligations.
With a Quick ratio value of 0.66, T is not doing good in the industry: 76.47% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.66 |
3. Growth
3.1 Past
T shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -8.73%.
T shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -7.30% yearly.
The Revenue has been growing slightly by 0.62% in the past year.
Measured over the past years, T shows a decrease in Revenue. The Revenue has been decreasing by -6.44% on average per year.
EPS 1Y (TTM)-8.73%
EPS 3Y-8.83%
EPS 5Y-7.3%
EPS Q2Q%-9.52%
Revenue 1Y (TTM)0.62%
Revenue growth 3Y-5.06%
Revenue growth 5Y-6.44%
Sales Q2Q%-0.4%
3.2 Future
T is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 1.22% yearly.
Based on estimates for the next years, T will show a small growth in Revenue. The Revenue will grow by 1.42% on average per year.
EPS Next Y-6.84%
EPS Next 2Y-1.88%
EPS Next 3Y0.13%
EPS Next 5Y1.22%
Revenue Next Year0.68%
Revenue Next 2Y1.18%
Revenue Next 3Y1.19%
Revenue Next 5Y1.42%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 9.12, the valuation of T can be described as reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of T indicates a rather cheap valuation: T is cheaper than 100.00% of the companies listed in the same industry.
T is valuated cheaply when we compare the Price/Earnings ratio to 29.62, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 9.04 indicates a reasonable valuation of T.
Based on the Price/Forward Earnings ratio, T is valued cheaply inside the industry as 85.29% of the companies are valued more expensively.
T is valuated cheaply when we compare the Price/Forward Earnings ratio to 21.22, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.12 | ||
| Fwd PE | 9.04 |
4.2 Price Multiples
T's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. T is cheaper than 73.53% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of T indicates a rather cheap valuation: T is cheaper than 91.18% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.16 | ||
| EV/EBITDA | 6.25 |
4.3 Compensation for Growth
T has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-1.88%
EPS Next 3Y0.13%
5. Dividend
5.1 Amount
T has a Yearly Dividend Yield of 5.62%, which is a nice return.
T's Dividend Yield is a higher than the industry average which is at 5.01.
T's Dividend Yield is rather good when compared to the S&P500 average which is at 2.24.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.62% |
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.
Dividend Growth(5Y)-10.62%
Div Incr Years0
Div Non Decr Years0
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-1.88%
EPS Next 3Y0.13%
AT&T INC
NYSE:T (9/6/2024, 8:04:00 PM)
After market: 20.9 -0.07 (-0.33%)20.97
+0.32 (+1.55%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap150.36B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.62% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
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EPS beat(4)
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EPS beat(8)
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EPS beat(12)
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EPS beat(16)
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Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.12 | ||
| Fwd PE | 9.04 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.15% | ||
| ROE | 11.89% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 20.07% | ||
| PM (TTM) | 10.25% | ||
| GM | 59.61% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.19 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.66 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)-8.73%
EPS 3Y-8.83%
EPS 5Y
EPS Q2Q%
EPS Next Y-6.84%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)0.62%
Revenue growth 3Y-5.06%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y