AT&T: Buy The Panic

Jul. 21, 2022 11:43 AM ETAT&T Inc. (T) StockTMUS, VZ, T171 Comments

Summary

  • AT&T beat estimates on both lines but reduced its free cash flow guidance.
  • This FCF guidance reduction resulted in a hefty selloff that destroyed $15 billion of equity value.
  • I do believe that the panic selling is overblown. The FCF was most likely only pushed into the future, the dividend is very safe, and deleveraging will continue.
  • I do much more than just articles at Cash Flow Club: Members get access to model portfolios, regular updates, a chat room, and more. Learn More »

Hand flipping wooden cubes for change wording" Panic " to " Calm". Mindset is important for human development.

Dilok Klaisataporn

Article Thesis

AT&T Inc. (NYSE:T) reported its second-quarter earnings on Thursday, beating estimates on both lines. But the company also had to cut its free cash flow guidance for the current year, which is why the market reacted very negatively

This article was written by

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Jonathan Weber holds an engineering degree and has been active in the stock market and as a freelance analyst for many years. He has been sharing his research on Seeking Alpha since 2014. Jonathan’s primary focus is on value and income stocks but he covers growth occasionally.

He is a contributing author for the investing group Cash Flow Club where along with Darren McCammon, they focus on company cash flows and their access to capital. Core features include: access to the leader’s personal income portfolio targeting 6%+ yield, community chat, the “Best Opportunities” List, coverage of energy midstream, commercial mREITs, BDCs, and shipping sectors,, and transparency on performance. Learn More.

Analyst’s Disclosure:I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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