Jan. 9, 2014, 2:42 PM
- AT&T (T -1.9%), Verizon (VZ -2%), and Sprint (S -4.4%) are each selling off after T-Mobile USA (TMUS -1.1%) announced a credit program for defecting mobile subscribers - up to $300 in credit for trading in a phone, buying an approved T-Mobile phone, and signing up for a postpaid plan, and up to $350 to pay off termination fees - that was even more aggressive than expected. Sprint is also being pressured by a Deutsche downgrade to Hold.
- FBR's David Nixon likely speaks for many on the Street when he expresses concerns AT&T, Verizon, and Sprint "will be forced to react to the move." Fears that T-Mobile's efforts will pressure industry margins and increase churn have already been running high. AT&T announced a smaller promotion (up to $450 in credit) last week.
- Nixon also says CES feedback points to "surprising confidence from T-Mobile US that a merger with Sprint could be approved if argued on the right basis." T-Mobile CEO John Legere didn't rule out a future acquisition by Sprint yesterday, though he did suggest T-Mobile's brand would be maintained post-acquisition. Legere also took quite a few shots at his rivals.
- Meanwhile SoftBank (SFTBF, SFTBY) CEO Masayoshi Son isn't mincing words regarding Sprint's challenges. In a Nikkei column, Son blasts Sprint's marketing efforts (all of the company's ad agencies have been fired), and says the carrier "has gotten used to being a loser."
Dec. 17, 2013, 7:38 AM
- Frontier Communications (NASDAQ:FTR) buys AT&T's (NYSE:T) wireline residential and business service that serves Connecticut for $2B in cash and related assets.
- The company expects the transaction to be accretive in the first year following the closing which is targeted for the second half of 2014 following regulatory approvals.
- FTR +13.8% premarket.
Dec. 4, 2013, 9:42 AM| Comment!
Oct. 31, 2013, 3:38 PM
- AT&T (T +0.2%) has stepped up work on a strategy for what would be a complex and expensive deal, says Bloomberg, in part trying to identify which assets it would retain and who would be buyers of the businesses to be spun off.
- The combined AT&T and Vodafone (VOD +2.3%) would have a market cap in excess of $250B, huge operations here and across the pond, and more than 500M wireless subscribers, giving it the scale to challenge Google and Apple when negotiating cell phone subsidies, and squeezing out profits from rising technologies like mobile advertising.
- Any deal, of course, would have to wait until Vodafone closes the sale of its Verizon Wireless stake, expected to occur early next year.
Sep. 23, 2013, 12:28 PM
- SocGen's Andy Perkins isn't impressed Apple's (AAPL +3.5%) new FQ4 revenue guidance remains within its original range in spite of the company's strong weekend iPhone sales. He takes this as a sign higher 5S/5C sales "came at the expense of the 4S." His $500 PT remains unchanged.
- Others on the sell-side are more enthusiastic, taking the numbers as evidence 5C demand was better than feared. Gene Munster thinks the 5C may have accounted for 3M-4M of the 9M+ weekend sales.
- Mobile analytics firm Localytics offers a different take. The firm's tracking data indicates the 5S outsold the 5C by a 3.4:1 margin in the U.S. over the weekend, and by a 3.7:1 margin internationally. In Japan, where NTT DoCoMo has commenced iPhone sales and the 5S is being offered for free with 2-year contracts, the ratio was 5:1.
- The 5S/5C managed to account for 1.36% of all active U.S. iPhones tracked by Localytics as of 8PM ET yesterday. 49% of them were on AT&T's (T -0.7%) network, and 38% on Verizon's (VZ).
Sep. 10, 2013, 11:37 AM
- In oral arguments for a Verizon (VZ) suit aiming to overturn wireline net neutrality rules, a federal appeals court questioned the legal foundations of the FCC's 2011 mandate on the issue.
- In particular, the judges suggested ISPs were improperly referred to as "common carriers," a designation originally meant to guarantee equal access to phone networks.
- However, the judges did suggest the FCC has the ability to prevent ISPs from blocking traffic outright.
- Verizon and AT&T (T), who have long criticized the FCC's rules, are likely pleased with the way oral arguments went. Major bandwidth consumers such as Netflix, Facebook, and Google/YouTube, some of whom are already making payments to ISPs for direct access to their networks, are likely less enthusiastic.
- Deep packet inspection (DPI) hardware vendors Allot (ALLT +5.9%) and Procera (PKT +7.1%) stand to benefit from the removal of net neutrality rules, which have curtailed the use of their equipment on U.S. wireline networks (though not mobile networks).
- Separately, Procera announced this morning it has received a multi-million dollar expansion order from a Tier-1 Western European carrier for its high-end PL20000 DPI systems. (PR)
Sep. 3, 2013, 9:55 AM
- Nokia (NOK +38.5%) has been upgraded to neutral ratings by Credit Suisse, Bernstein, and Oppenheimer following the Microsoft deal.
- Vodafone (VOD -3%) has been upgraded to Market Perform by Bernstein, and cut to Neutral by Macquarie, in the wake of the Verizon deal.
- Canadian carriers BCE (BCE +4.4%) and Telus (TU +6.8%) have been upgraded to Outperform in response to Verizon/Vodafone, and Verizon's subsequent assertion it has no plans to enter Canada.
- AT&T (T +0.6%) has been upgraded to Neutral by Macquarie.
- Palo Alto Networks (PANW -1.5%) has been downgraded to Market Perform by JMP.
- Cvent (CVT +1.4%) has received three bullish ratings and one neutral one, and YuMe (YUME +1.5%) has received four bullish ratings, as underwriters launch post-IPO coverage.
Jul. 15, 2013, 12:45 PM
Jul. 15, 2013, 9:11 AM
Jul. 12, 2013, 5:30 PM
Jul. 12, 2013, 5:23 PMMore on AT&T/Leap: AT&T is paying $1.18B for Leap's equity, and assuming $2.8B in net debt. Leap shareholders will also receive net proceeds from the sale of spectrum Leap bought for $204M last August. Leap has 5M prepaid subs on a network covering 96M people, and AT&T says it will keep the Cricket brand and expand its reach. But this deal is mostly about acquiring Leap's spectrum (covers 137M people), much of which is unused and could be of use in AT&T's 4G buildout, especially in urban areas. Expect the FCC to closely scrutinize the deal; will new leadership yield a different outcome than the one for the T-Mobile deal? LEAP now +106.5% AH to $16.48, investors are betting on a higher bid. TMUS +4.1%. T -0.4%. (PR) | 3 Comments
Jul. 12, 2013, 5:07 PM
Jul. 3, 2013, 10:07 AMLeap Wireless (LEAP +3.4%) jumps following an upgrade to Neutral from Macquarie's Kevin Smithen, which thinks the odds of a $10+/share acquisition by T-Mobile USA or Dish have grown. Smithen thinks the recent run-up in T-Mobile (TMUS) shares has made a deal easier for the #4 U.S. carrier to swallow, and considers the concentration of Leap's equity in a few holders "both a catalyst and an obstacle for a sale." He cautions Leap's "already eroding operating business" could be further pressured by T-Mobile's plans to enter Leap markets (via MetroPCS), but adds it could "drive Leap's Board and key holders to sell now." | Comment!
May. 20, 2013, 11:54 AMLeap Wireless (LEAP -2%) slumps after Deutsche cuts shares to Sell while reiterating its $4 PT. The firm is worried about tougher prepaid competition from T-Mobile (via MetroPCS) and AT&T (via its new Aio prepaid brand), and a relatively high valuation (7.4x 2014E EV/EBITDA vs. 4.7x-7x for peers) in spite of "inferior growth prospects." Barclays launched coverage with an Underweight last Friday. | Comment!
May. 17, 2013, 9:10 AMLeap Wireless (LEAP) -2.5% after Barclays starts coverage with an Underweight and $4 PT as part of a broader coverage launch of U.S. telecom service providers. Tower owners SBA (SBAC) and American Tower (AMT) have been started at Overweight, and so has Verizon (VZ). AT&T (T) and T-Mobile USA (TMUS) have been started at Equal Weight. | Comment!
May. 9, 2013, 11:04 AMYield-chasing investors should be wary of AT&T (T -1.5%, 4.8% yield) and Digital Realty (DLR -5.4%, 4.6% yield), warns Jonathan Jacobson at the Sohn conference. AT&T's wireline ops are a "melting ice cube," Jacobson declares (revenue fell 1.8% Y/Y in Q1), and mobile competition is intensifying. As for DLR, he asserts "the data center [colocation] business is a commodity business" (ed: true, but it has been growing quickly), and accuses DLR of understating recurring capex. He also considers its dividend unsustainable without fresh capital-raising efforts. In addition to Jacobson's remarks, DLR appears pressured by Rackspace's Q1 miss. | 9 Comments
T vs. ETF Alternatives
AT&T Inc, through its subsidiaries and affiliates, provides wireless and wireline telecommunications services in the United States and internationally. The Company has three reportable segments: Wireless, Wireline, and Other.
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