AT&T Inc. reported third quarter revenues that beat analysts’ expecttions, on strong additions to its media and wireless networks.
The telecom & media giant’s adjusted earnings for the three months ending in September came in at 76 cents per share, quite in-line with Street forecasts . The figure is however -19% lower from the year-ago period. The company estimated a -21 cents per share earnings hit linked to the coronavirus pandemic.
Revenues fell -5.2%year-over-year to $42.3 billion, but surpassed analysts' expectations of $41.6 billion.
According to AT&T, subscribers to its HBO Max streaming service hit 38 million in the U.S. last quarter, pushing it ahead of its 2020 target. The company’s wireless network added a higher-than-expected 645,000 new subscribers monthly-paying customers.
Also, speaking about AT&T’s "strong cash flow in the quarter”, CEO John Stankey said the company is positioned to continue investing in growth areas and pay down debt. He added, "We now expect 2020 free cash flow of $26 billion or higher with a full-year dividend payout ratio in the high 50s%. “
According to Tickeron, T in downward trend: 10-day moving average crossed below 50-day moving average on September 04, 2020
The 10-day Moving Average for T crossed bearishly below the 50-day moving average on September 04, 2020. This indicates that the trend has shifted lower and could be considered a sell signal. In 12 of 19 past instances when the 10-day crossed below the 50-day, the stock continued to move higher over the following month. The odds of a continued downward trend are 63%.
Current price $28.17 crossed the resistance line at $28.12 and is trading between $28.56 support and $28.12 resistance lines. Throughout the month of 09/21/20 - 10/21/20, the price experienced a -3% Downtrend. During the week of 10/14/20 - 10/21/20, the stock fell -3%.
Technical Analysis (Indicators)
Bearish Trend Analysis
The Momentum Indicator moved below the 0 level on October 15, 2020. You may want to consider selling the stock, shorting the stock, or exploring put options on T as a result. In 37 of 81 cases where the Momentum Indicator fell below 0, the stock fell further within the subsequent month. The odds of a continued downward trend are 46%.
The Moving Average Convergence Divergence Histogram (MACD) for T turned negative on October 16, 2020. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 49 similar instances when the indicator turned negative. In 21 of the 49 cases the stock turned lower in the days that followed. This puts the odds of success at 43%.
T moved below its 50-day Moving Average on October 09, 2020 date and that indicates a change from an upward trend to a downward trend.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where Apple declined for three days, the price rose further in 50 of 62 cases within the following month. The odds of a continued downward trend are 46%.
The Aroon Indicator for T entered a downward trend on October 06, 2020. This could indicate a strong downward move is ahead for the stock. Traders may want to consider selling the stock or buying put options.
Bullish Trend Analysis
The RSI Indicator demonstrates that the ticker has stayed in the oversold zone for 2 days, which means it's wise to expect a price bounce in the near future.
The Stochastic Indicator shows that the ticker has stayed in the oversold zone for 4 days. The price of this ticker is presumed to bounce back soon, since the longer the ticker stays in the oversold zone, the more promptly an upward trend is expected.
Following a +1.96% 3-day Advance, the price is estimated to grow further. Considering data from situations where T advanced for three days, in 143 of 336 cases, the price rose further within the following month. The odds of a continued upward trend are 43%.
T may jump back above the lower band and head toward the middle band. Traders may consider buying the stock or exploring call options.
Fundamental Analysis (Ratings)
Tickeron has a negative outlook on this ticker and predicts a further decline by more than 4.00% within the next month with a likelihood of 65%. During the last month, the daily ratio of advancing to declining volumes was 1 to 1.79.
The Tickeron Profit vs. Risk Rating rating for this company is 75 (best 1 - 100 worst), indicating that the returns do not compensate for the risks. T’s unstable profits reported over time resulted in significant Drawdowns within these last five years. A stable profit reduces stock drawdown and volatility. The average Profit vs. Risk Rating rating for the industry is 79, placing this stock better than average.
The Tickeron Price Growth Rating for this company is 62 (best 1 - 100 worst), indicating fairly steady price growth. T’s price grows at a lower rate over the last 12 months as compared to S&P 500 index constituents.
The Tickeron SMR rating for this company is 53 (best 1 - 100 worst), indicating slightly weaker than average sales and a marginally profitable business model. SMR (Sales, Margin, Return on Equity) rating is based on comparative analysis of weighted Sales, Income Margin and Return on Equity values compared against S&P 500 index constituents. The weighted SMR value is a proprietary formula developed by Tickeron and represents an overall profitability measure for a stock.
The Tickeron Valuation Rating of 7 (best 1 - 100 worst) indicates that the company is seriously undervalued in the industry. This rating compares market capitalization estimated by our proprietary formula with the current market capitalization. This rating is based on the following metrics, as compared to industry averages: P/B Ratio (1.08) is normal, around the industry mean (1.49). P/E Ratio (16.32) is within average values for comparable stocks, (672.50). Projected Growth (PEG Ratio) (0.00) is also within normal values, averaging (76.04). Dividend Yield (5.25) settles around the average of (2.99) among similar stocks. P/S Ratio (1.24) is also within normal values, averaging (1.88).
The Tickeron PE Growth Rating for this company is 2 (best 1 - 100 worst), pointing to outstanding earnings growth. The PE Growth rating is based on a comparative analysis of stock PE ratio increase over the last 12 months compared against S&P 500 index constituents.