att just announced its quarter two results and since then the stock is now down 10.02 percent on
the month is now the time to buy hold or sell now it's been a while since we talked about at t on
the channel so the problem that we're faced with now that we have quarter two results from at t is
this stock worth considering despite their focus on telecommunications specifically and if it is
worth it what is the best desirable buy price well to answer this question we need to dig into the
quarter two presentation and understand a little bit more and don't worry i'll share my attitude
toward the at t stock as we go through the video as well as my desired buy price now on the surface
to be honest at t looks like a bunch of hot trash i mean just look at it over here on seeking alpha
in the last five years down 35 but then again it's like comparing a t to losing weight hear me out on
this one you decide you want to completely change the way you eat after carrying around some extra
weight instead of mcdonald's and burger king every day you're going to completely change the way you
eat and you're going to work out a lot more so you announce to the world you know probably on
twitter or tick tock that it's new year new me a few months go by with your new focus and what do
you have to show for it maybe some weight loss but i bet it wasn't as awesome as you want it to be so
it's the same thing with att they decided to lose weight by selling their warner media holdings you
know things like hbo and all that kind of stuff that was all part of warner media they decided to
sell that off and focus att only on their roots a telecommunications company and now in quarter two
they're showing you the result of their new weight loss program so if we look right over here you can
see that their revenue by quarter has just been kind of going down from quarter to 20 or 21 to
the most recent 2022 and that is quite a drop off but i guess that's to be expected because after
all you sold a core part of your business that was also helping to make more revenue so now that
you're only focused on telecommunications is your diet plan actually paying off well in order to
find that out we need to dig a little bit deeper into the quarter to results and specifically we
need to look at the telecommunications and their actual subscribers so that way we can determine is
there a potential buy price for this and what's the outlook for the future and then we need to
compare at t with the big boy the big dog you know which one it is verizon wireless now that
we're only talking about telecommunications and not a mixed bag of other things how's it stacking
up against the big dog so right here we are we're looking at the at t quarter two earnings result
deck but i wanna pull your attention to something very interesting and it's right here we're cutting
right to the chase i'm even gonna zoom in on it to make life a little bit easier so we can see
it okay look at this if we look at the quarters and we're looking at phone subscribers first 65.5
million paid subscribers and then we come up to 68.3 phone subscribers so quarter two of last year
they had a net out of 789 whereas now quarter two 2022 they had a net out of 813. that is a
great thing because what we're looking at despite the revenue and all the bs and you know the fact
that the stock is down is the fact that they are growing the business so that focus on the core
telecommunications that right there is a green light and a green check mark for me if they keep
it up so i want to see this continue to grow as we get into quarter three and quarter four of 2022
because now that we're focused on our new diet plan as i was referencing earlier well now we have
the opportunity to see potential growth or weight loss you get what i'm saying now let's look at the
other end of the spectrum because not only do you have telecommunications as part of this you have
fiber optics so look at the fiber customers in millions so we're at 5.4 in the second quarter
of 2021 going all the way up to 6.6 that's a net add of 316 000 people in the last year now what's
really important here is the fact that we just got out of the pandemic we just got out of the
place where we put everybody in their home having to rely on fiber optics and telecommunications and
things like that right now the problem i had with it back then which i referenced in my older videos
is the fact that a t should have been the king dog because people are staying at home they need
to rely on a reliable phone service and a reliable internet service well why would you be dropping in
which case they did back in 2020 because they were focused on all this other stuff now that we've
trimmed the fat and the focus specifically on how do we grow this particular part of the business
now they're really becoming a key competitor to verizon wireless a key competitor to t-mobile
and the fact that we're seeing growth could be a promising sign for the future
we'll have to see it gets even better though let's look at their financial outlook so if
you look at standalone a t their total revenue previous guidance was low single digit growth no
change there but the wireless service revenue they projected previously at a three percent it's now
gone up yes that's what we want to see at a 4.5 to 5 growth we're going to hold you to that because
if you are invested in att remember my friend you are now an owner of the company because you earn
a share of 18 t so you got to keep your eye on the game is your company performing the way you
want it to and if not you might need to make some hard decisions right but in this case i like the
fact that we're updating our guidance to say we're going to continue to grow a little bit stronger in
our wireless service no change to all the other previous guidance which is fine we just don't
want to see it go down but one thing i am a little bit concerned about is free cash flow going from 4
from 16 to 14 billion range we want to see that go up so that's a little bit of a yellow light for me
i'm going to keep a closer eye on the free cash flow can you beat the updated guidance and even
potentially hit or beat your previous guidance now if you do that there is a potential that a t could
become a much stronger company but of course now we're going to look at this guidance right
here we're going to compare this head-to-head with verizon wireless look at this they're a little bit
higher than at t i'm going to be hopping back and forth so we can take a look at it they're
projecting a 4.5 to 5 percent growth in overall revenue whereas verizon is 8.5 to 9.5 however
look at the difference 9 to 8.5 10 to 9.5 they're lowering their guidance could at t potentially be
pulling some market share from verizon not sure but this is something to keep our eye on but look
at all of this they're also projecting a negative ebitda growth adjusted earnings per share going
down on verizon wireless you compare that to at t where we saw no change except for free cash flow
so they're still feeling confident about the numbers and the goal and the guidance that
they set for themselves at atm t whereas verizon the big dog is starting to say ah things aren't
looking as sexy as it once did now there's a lot of debate that we could have about this of
course the fact that verizon was doing very well during the pandemic and now they've got to kind
of dial back a little bit as people go out and are at work and all this other stuff but i would
also want to say well wait a minute why would we not want to continue to grow revenue as a result
of all these other initiatives people aren't just dropping their phones as a result of the pandemic
being over no no no people want to continue their phone service that's super important in
fact iphone is about to come out with its brand new model in september this is all good stuff
why aren't we seeing a little bit more confidence in verizon versus the confidence we have an att
could be because att needs to dig themselves out of a little bit of a deeper hole than verizon but
this is really interesting stuff to keep our eye on so am i still holding at t and what is
the potential buy price for this one well the answer quickly is yes i'm still holding att
i bought it back in late 2020 primarily as part of my dividend paying portfolio now of course
they just recently cut their dividend as a result of restructuring the company a little bit but it
still does pay a nice dividend now while i am down a lot of money on this particular stock i
am currently bearish in the short term so that means i have a negative outlook in the short
term however i am bullish in the long term which means i have a positive outlook in the long term
this my friend is a long term hold as long as they stay committed to what they're saying that they're
doing with their telephone and telecommunications company now let's look at that by price now if
you want the stuff that we were just looking at right here right here and you want to get some
additional behind-the-scenes data on atnt you got to check out seeking alpha this is what i now use
which gives you ratings and detail and information that you can't get on your everyday brokerage
go check it out seeking alpha in fact they're offering you because you're awesome and watching
this video 50 off their premium plan link down in the description below so if i go here to att
and we look at the 52 week range now we look at a difference between a 2156 down to a 1663.
you see that 2156 down to 1663. so what i'd be interested in looking at if we hit in the 15
range i think 15 or below could be a very thirsty buying opportunity not financial
advice to buy hold or sell this is just what i'm looking at based on a few metrics
not only in the rating summary of seeking alpha but also in the overall look of my particular
portfolio strategy i will tell you though if you look at this p e ratio of only 7.24
if you've been following my channel for a long period of time you know we like those things
that are below 15 you know 20 that's a 7.24 that could potentially signal an undervalued company so
remember as an owner of the company you decide to buy a stock an individual stock like at t
you have got to keep your eye on the game because as an owner what you want to do is make sure that
your company is performing the way you expect it to if it's not and it's starting to do things that
are a little bit sketchy that you're like you know what this i'm not feeling you need to make
the best decisions for you and that sounds like a lot of work to have to keep an eye on all these
different things you might want to look at an etf instead an etf holds a basket of different stocks
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