Crypto currency

AT&T Stock Forecast: Will Shares Ever Recover?

AT&T is the world’s telecom giant. However, its shares seem to be undervalued. If we look at the chart, we will see only a downtrend. Will the T stocks ever recover? What is the future of AT&T? Let’s discover AT&T’s prospects for the next 10 years. 

The article covers the following subjects:

A Brief Overview of AT&T’s Shares

AT&T Inc. (SBC Communications Inc. until November 2005) is a well-known provider of telco, media, and technology services. The company’s segments are Communications, WarnerMedia, and Latin America.

  • The Communications segment is represented by AT&T, Cricket, AT&T TV, AT&T Fiber, and DirecTV brands. It includes wireless voice services and data communication infrastructure, video and targeted advertising services, broadband, wireline telecom services, etc.

  • The most popular brands of the WarnerMedia segment are HBO, HBO Max, HBO GO, and Cinemax. The segment includes production, distribution, licensing of television programming and feature films; distribution of digital and physical home entertainment products; production and distribution of mobile and console games and consumer products; brand licensing and advertising services.

  • AT&T is a parent company of DirecTV, SKY, and Unefon in the Latin America segment. The segment includes video entertainment, audio programming, postpaid, and prepaid wireless services.

Here is some data on T stocks (New York Stock Exchange: T):

  • Market cap: $206.92 billion

  • Shares outstanding: 7.188 billion

  • Public float: 7.13 billion

  • P/E ratio: N/A

  • Payout ratio: 65.82% (based on this year’s estimates)

  • EPS: -$0.35 

  • Dividend Yield: 7.15%

  • 52-week range: 26.35 – 33.88

  • Annual dividend: $2.08 per share

  • Forecast 12-month forward PEG Ratio: 2.97

  • Average volume: 46.73 million shares

  • Debt to equity ratio for the quarter ending in March 2021: 0.88

AT&T Inc. was founded on October 5, 1983. It became a publicly-traded company on July 19, 1984. There were only 2 stock splits. The first one (2 stocks prorated to 1) took place on March 20, 1998. The second split was held on November 18, 2002. This was an unusual 24,875 for 50,000 reverse split. It meant that for each 50,000 shares pre-split, the shareholder now owned 24,875 shares. For instance, a 2,000 share position pre-split became a 995 position.

How much is AT&T stock? The stock price today 18.06.2021 is 28.73 US dollars.

Key Factors That Affect T Stock Price in 2021 & Beyond

When trying to predict a company’s stock direction, it’s worth considering basic factors. They include financial outlook, earnings reports, the industry’s environment, and internal company news. However, every firm has certain factors that will make sense only for its future.

Poor Acquisitions

In 2015, the company merged with DirecTV. Since then, the company has been suffering losses only. However, it refuses to fully divest the subsidiary. Additionally, analysts and investors blame the company for the lack of transformational ability. The company focuses on losing businesses and avoiding its core business of telecommunication services.

If the company doesn’t get rid of unprofitable businesses, its shares will continue falling.

Challenging Competition

Focusing on weak DirecTV, the company doesn’t pay enough attention to 5G and an expansion into streaming services. Although the Ookla Speedtest recognized AT&T’s network as the fastest for both 4G and 5G, its competitors, Verizon and T-Mobile, spend lots of money on upgrading their speed and quality. It will increase price competition. If the enterprise doesn’t refocus its business strategy, a new outlook on its stock rate won’t take place. However, the enterprise always works on its services, including a refund policy.

Expensive Dividends

AT&T pays 63% of free cash flow in dividends, while its rivals spend less. Verizon pays about 50%, and T-Mobile doesn’t pay dividends at all. Of course, it makes a firm’s shares attractive for investors. Just to compare, T shareholders earn $2.08 per share, and the average yield is about 6.6%, while S&P 500’s average yield is 1.4%.

This situation is uncertain. On the one hand, good dividends will attract more investors, increasing the interest in the company and boosting its stocks. On the other hand, high payments affect the company’s finances. For instance, the firm has limited funds to improve the 5G segment. In 2021, the estimated CapEx is in the USD 21 billion range.

At the same time, the company’s CEO claimed there is no need for dividend cuts for the growth of funds.

HBO Outlook

In 2021, the company is going to expand HBO Max. In June, the company is expected to launch 39 Latin American and Caribbean markets along with a service’s ad-supported version in the US. 21 markets should be launched in the second half of 2021. The expansion will result in 67 million and 70 million total HBO and HBO Max subscribers.

If the company succeeds, the stocks will move up.

AT&T Stock Projections for 2021: Analysts’ Recommendations

Will AT&T stock go up in 2021? The average 12-month forecast by 15 Wall Street analysts is $31.67. The maximum price is set at $38.00; the lowest AT&T stock price target is $25.00. Although 8 analysts set a “Buy” rating, the average rating is “Hold”, as there are 3 “Sell” ratings and 4 “Hold” ratings.

Morgan Stanley

Analysts at Morgan Stanley lowered the target price to $32 from $34, maintaining the “Hold” rating.

John Hodulik, UBS

John Hodulik at UBS raised the price target to $35 from $32, upgrading the rating to “Buy” from “Neutral”.

Jonathan Chaplin, New Street Research

Jonathan Chaplin at New Street Research raised the rating to “Buy” from “Neutral” and kept the future price target at $35.

Frank Louthan, Raymond James

Raymond James, represented by Frank Louthan, kept the “Buy” rating unchanged and raised the potential price to $33 from $32.

Deutsche Bank Aktiengesellschaft

Analysts at Deutsche Bank Aktiengesellschaft raised the price to $34 from $31 without rating.

Technical Analysis of AT&T Shares

Is now a good time to buy AT&T stock? Let’s consider price dynamics.

The technical analysis looks more optimistic. On the daily chart of T stocks, the price is trading sideways. The MACD indicator has almost crossed the 0 level upside. At the same time, the Awesome Oscillator may form a hidden bullish divergence with the price chart if the price keeps rising. Both indicators provide odds on the short-term upward movement. Resistance levels are placed at $30 and $31. The support levels are a range of $28.50-$27.90 and $26.50. Stop-loss levels can’t be defined.

However, on the weekly chart, Moving Averages and oscillators signal selling pressure. So, stock performance may change soon. Classic weekly pivot levels are:

S3 — 4.52

S2 — 17.99

S1 — 23.38

P — 31.46

R1 — 36.85

R2 — 44.93

R3 — 58.40

Check the current AT&T stock quotes below.

AT&T Stock Forecast for 2022

Wallet Investor doesn’t expect long-term growth. Starting the year at $28.570, it will drop to USD 26.907 by the end of December next year. A narrow price gap between minimum and maximum rates signals low volatility, which is positive for long-term investors. However, a constant decline doesn’t predict profit from such investments.

Date

Opening price

Closing price

Minimum value

Maximum value

January 

28.570

28.128

28.128

28.597

February

28.167

28.006

28.006

28.167

March 

28.035

28.116

27.839

28.118

April 

28.155

28.171

28.155

28.356

May 

28.112

27.834

27.795

28.139

June 

27.760

27.676

27.664

27.817

July 

27.683

27.707

27.573

27.716

August

27.714

27.137

27.137

27.760

September 

27.147

27.390

27.130

27.471

October 

27.295

26.269

26.269

27.301

November 

26.307

26.414

26.234

26.468

December 

26.453

26.907

26.453

26.956

Source: Wallet Investor

T Stock Forecast for 2023

The AT&T share price forecast for 2023 is negative. Investors should expect long-term growth. A bearish trend will continue in 2023. The rate will fall from $26.864 (opening price) in January to $25.191 (closing price) in December. The limited price change is positive in terms of low volatility. Still, a downtrend signals the company’s problems.

Month

Opening price

Closing price

Minimum price

Maximum price

January

26.864

26.448

26.410

26.892

February

26.374

26.328

26.298

26.434

March

26.244

26.402

26.112

26.402

April

26.460

26.467

26.460

26.626

May

26.409

26.041

26.041

26.435

June

26.058

25.970

25.951

26.094

July

25.933

25.984

25.850

25.984

August

26.032

25.436

25.429

26.032

September

25.441

25.690

25.396

25.755

October 

25.610

24.589

24.554

25.622

November

24.514

24.707

24.514

24.726

December

24.739

25.191

24.739

25.232

Source: Wallet Investor

Long-Term AT&T Stock Forecast for 2025 and Beyond

How much will AT&T be worth in 5 years? Wallet Investor has a negative AT&T stock price prediction until the middle of 2026. The estimated prices are $23.395 (January 2025) and $20.890 (December 2026).

Month

Opening price

Closing price

Minimum price

Maximum price

2025

January

23.395

22.964

22.938

23.403

February

22.945

22.839

22.829

22.987

March

22.787

22.955

22.667

22.955

April

23.021

22.941

22.941

23.188

May

22.946

22.631

22.605

22.946

June

22.610

22.507

22.507

22.650

July

22.541

22.532

22.404

22.569

August

22.551

22.026

22.026

22.583

September

21.978

22.245

21.941

22.305

October

22.149

21.104

21.083

22.149

November

21.088

21.251

21.063

21.251

December 

21.290

21.685

21.290

21.775

2026

January

21.695

21.245

21.222

21.697

February

21.224

21.131

21.120

21.264

March 

21.081

21.268

20.949

21.268

April

21.221

21.242

21.221

21.465

May

21.241

20.913

20.888

21.241

June

20.890

20.890

20.890

20.890

Source: Wallet Investor

It’s worth remembering that such long-term forecasts are subject to constant changes and a low level of accuracy as the stock market is highly volatile.

AT&T’s Historical Price Fluctuations: Timeline

Historical accuracy plays an important role in price projections. The price history shows what events affected the stock’s rate in the past. As history repeats itself, it’s worth knowing prior events to predict future stock quotes. Let’s have a look at past stock performance. Historically, even last month’s data can provide ideas on the future direction.

On the week-period timeframe, we can notice that the overall downtrend started in the middle of June 2016. If we look precisely at the price movements during 2016, we will notice high volatility caused by many changes in the company’s business. Why was AT&T’s stock down?

In the middle of the year, the price was trading near $43. After that, it plunged. A drastic fall happened in October 2016, when the enterprise announced it would buy Time Warner. However, the rate managed to recover by the end of December. The financial outlook wasn’t fully positive, but the successful integration of DirecTV, which led to big gains in that service, pushed the stock price up.

In 2017, the stocks were mostly down as the company suffered tough competition. Sprint Corp planned to partner up with Comcast Corporation and Charter Communications, Inc., which would create a more challenging competitive environment. Also, difficulties in the wireless services industry were putting pressure on the company. By the end of the year, the price was near $40.

2018 was a bad year for AT&T, Inc. During the first half of 2018, AT&T’s share price dropped by 17.4%. The company’s weak quarterly revenue, the Department of Justice’s antitrust suit that would determine the legality of the Time Warner merger, and uncertainties about the profitability of the merger put pressure on the stocks. Although the court approved the merger without any requirements to sell off assets like DirecTV or the Turner networks, stocks continued losing their value. Later on, the corporation struggled in the satellite television business. In the third quarter, 359,000 customers left DirecTV. At the end of December, the price was $28.

2019 was more promising for the share price. That year AT&T was among the most popular companies for stock dividends. The enterprise was still blamed for expensive mergers with DirecTV and Time Warner. However, it managed to reassure investors. AT&T promised to avoid new acquisitions and get rid of unprofitable non-core businesses. During the year, the firm was able to return to $40.

The corporation would set a new all-time high (the last time the all-time high of 59.19 was reached on July 16, 1999), but the coronavirus pandemic upset its plans. By March 23, the stock rate was near $26. During the rest of 2020 and the first half of 2021, the stocks were trading sideways within a narrow range of $27-$32.

The company’s corporate debt in December 2020 equaled the data of the previous year. Annualized Debt-to-EBITDA as of the quarter ended in March 2021 was 2.45.

Is It Good to Invest in AT&T (T)?

T shares aren’t among the top stocks to invest in. AT&T is a popular brand in the telecom sector. Still, the company can’t get rid of losing businesses and focus on primary segments. It affects its financial position and attractiveness for investors. That’s why its future growth is limited.

The price expectations are weak. According to analysts and market experts, the company’s shares will lose value for the next 10 years.

Year

Average

Minimum value

Maximum value

2021

$24.63

$22.86

$27.72

2022

$23.28

$22.84

$23.72

2023

$23.84

$23.67

$23.96

2024

$23.87

$23.71

$23.98

2025

$23.66

$23.65

$23.69

2026

$23.63

$23.62

$23.66

2027

$23.63

$23.62

$23.65

2028

$23.59

$23.43

$23.63

2029

$23.31

$23.09

$23.6

2030

$23.11

$23.1

$23.17

Source: AI Pickup LLC

AT&T stocks aren’t a good long-term investment, so they won’t allow earning on their growth. However, you can trade them. Trading allows buying and selling assets without owning them. Intraday trading is an interesting option. A Liteforex demo account resembles real market conditions and provides a wide range of indicators for technical analysis to gain experience in challenging stock trading.

AT&T Price Prediction FAQ

Price chart of T in real time mode

The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteForex. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.

Rate this article:

{{value}} ( {{count}} {{title}} )


Most Related Links :
Business News Governmental News Finance News

Source link

Back to top button