Earnings Preview: AT&T Reports Q4 Results Thursday

Jan.24.12 | About: AT&T Inc. (T)

AT&T Inc. (NYSE:T) is expected to report last fiscal quarter's results before the opening bell on January 26, 2012. Let's review how AT&T has performed in recent quarters.

AT&T Inc., together with its subsidiaries, provides telecommunication services to consumers, businesses, and other service providers worldwide. The company was founded in 1983 and is based in Dallas, Texas.

52 Week High: $31.94
52 Week Low: $27.20
Book Value: $19.17
Float Short: 0.88%

Analysts are expecting a drop of $-0.17 in earnings per share compared to last quarter's results of $0.61. Investors will be looking to top $0.44 per share, based on the estimated mean earnings. Analyst estimates range between $0.34 and $0.58 per share.

The current trailing twelve months P/E ratio is 13.1. The forward P/E ratio is 12.59. In the last month, the stock has increased in price 2.14%, with a one year change of 8.08%. When comparing to the S&P 500, the year to date difference is -3.54%.

AT&T recently announced a price hike for new smart phone data users. At the same time, AT&T applied to the FCC for permission to transfer $1 billion worth of wireless airwaves as part of the settlement to T-Mobile for failing to execute the attempted take over bid. Adding in the cash of $3 billion, it gives us a total of $4 billion dollars moved from an American company over to a German company. AT&T backed down after central planners in Washington decided they know better than the free market what companies and consumers need and want.

Worse yet for investors of AT&T, they now own a company that is directly $4 billion worse off, and likely tens of millions indirectly due to the costs and management wasted direction. I believe the most attractive aspect of Ma Bell is the dividend. With an almost 5.8% yield, it is very attractive. Beyond acting much like a giant corporate bond, I don't find much growth opportunity for AT&T and would not buy it unless it went on a big discount.

Revenue year-over-year has increased to $124.28 billion for 2010 vs. $122.51 billion for 2009. The bottom line has rising earnings year-over-year of $19.86 billion for 2010 vs. $12.14 billion for 2009. The company's earnings before interest and taxes are falling, with an EBIT year-over-year of $19.57 billion for 2010 vs. $21.00 billion for 2009. Rising revenue along with rising earnings is a very good sign and what we want to see with our companies. Be sure to check the margins to make sure that the bottom line is keeping up with the top line.

Here is a look at the fiscal year revenue:

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Here is the last few quarters to get an idea how well they perform compared to estimates:

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Reported earnings per share compared to the mean estimate. Differences are rounded.

The total short interest number of shares for T:

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The number of days to cover short interest based on average daily trading volume for T
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I use a proprietary blend of technical analysis, financial crowd behavior, and fundamentals in my short-term trades, and while not totally the same in longer swing trades to investments, the concepts used are similar. You may want to use this article as a starting point of your own research with your financial planner. I use Seeking Alpha, Edgar Online, and Yahoo Finance for most of my data. I use the confirmed symbols from earnings.com that I believe to be of the most interest.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.