AT&T INC (T) Stock Fundamental Analysis
NYSE:T - New York Stock Exchange, Inc. - US00206R1023 - Common Stock - Currency: USD
We assign a fundamental rating of 4 out of 10 to T. T was compared to 33 industry peers in the Diversified Telecommunication Services industry. While T belongs to the best of the industry regarding profitability, there are concerns on its financial health. T has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
T had positive earnings in the past year.
T had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: T reported negative net income in multiple years.
Each year in the past 5 years T had a positive operating cash flow.
1.2 Ratios
Looking at the Return On Assets, with a value of 2.96%, T is in the better half of the industry, outperforming 63.64% of the companies in the same industry.
The Return On Equity of T (11.32%) is better than 69.70% of its industry peers.
T has a Return On Invested Capital of 5.31%. This is in the better half of the industry: T outperforms 69.70% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for T is in line with the industry average of 7.13%.
The last Return On Invested Capital (5.31%) for T is above the 3 year average (5.19%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.96% | ||
| ROE | 11.32% | ||
| ROIC | 5.31% |
ROA(3y)1.35%
ROA(5y)1.32%
ROE(3y)5.03%
ROE(5y)4.74%
ROIC(3y)5.19%
ROIC(5y)4.76%
1.3 Margins
T's Profit Margin of 9.55% is fine compared to the rest of the industry. T outperforms 66.67% of its industry peers.
In the last couple of years the Profit Margin of T has grown nicely.
T's Operating Margin of 19.84% is fine compared to the rest of the industry. T outperforms 75.76% of its industry peers.
T's Operating Margin has improved in the last couple of years.
T has a Gross Margin of 59.90%. This is comparable to the rest of the industry: T outperforms 54.55% of its industry peers.
In the last couple of years the Gross Margin of T has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.84% | ||
| PM (TTM) | 9.55% | ||
| GM | 59.9% |
OM growth 3Y0.54%
OM growth 5Y4.03%
PM growth 3Y-16.01%
PM growth 5Y2.75%
GM growth 3Y2.85%
GM growth 5Y2.22%
2. Health
2.1 Basic Checks
T has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
T has more shares outstanding than it did 1 year ago.
T has less shares outstanding than it did 5 years ago.
T has a better debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 0.90, we must say that T is in the distress zone and has some risk of bankruptcy.
T has a Altman-Z score (0.90) which is in line with its industry peers.
T has a debt to FCF ratio of 6.47. This is a slightly negative value and a sign of low solvency as T would need 6.47 years to pay back of all of its debts.
With a decent Debt to FCF ratio value of 6.47, T is doing good in the industry, outperforming 75.76% of the companies in the same industry.
T has a Debt/Equity ratio of 1.13. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.13, T perfoms like the industry average, outperforming 51.52% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.13 | ||
| Debt/FCF | 6.47 | ||
| Altman-Z | 0.9 |
ROIC/WACC0.74
WACC7.14%
2.3 Liquidity
T has a Current Ratio of 0.70. This is a bad value and indicates that T is not financially healthy enough and could expect problems in meeting its short term obligations.
T's Current ratio of 0.70 is on the low side compared to the rest of the industry. T is outperformed by 81.82% of its industry peers.
T has a Quick Ratio of 0.70. This is a bad value and indicates that T is not financially healthy enough and could expect problems in meeting its short term obligations.
T has a worse Quick ratio (0.65) than 81.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.65 |
3. Growth
3.1 Past
T shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -5.93%.
The Earnings Per Share has been decreasing by -8.79% on average over the past years.
The Revenue has been growing slightly by 0.50% in the past year.
T shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -7.56% yearly.
EPS 1Y (TTM)-5.93%
EPS 3Y-12.73%
EPS 5Y-8.79%
EPS Q2Q%-7.27%
Revenue 1Y (TTM)0.5%
Revenue growth 3Y-3%
Revenue growth 5Y-7.56%
Sales Q2Q%1.99%
3.2 Future
T is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.07% yearly.
Based on estimates for the next years, T will show a small growth in Revenue. The Revenue will grow by 2.18% on average per year.
EPS Next Y-7.74%
EPS Next 2Y0.69%
EPS Next 3Y4.34%
EPS Next 5Y6.07%
Revenue Next Year1.7%
Revenue Next 2Y1.52%
Revenue Next 3Y1.53%
Revenue Next 5Y2.18%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 12.71, which indicates a correct valuation of T.
Compared to the rest of the industry, the Price/Earnings ratio of T indicates a somewhat cheap valuation: T is cheaper than 75.76% of the companies listed in the same industry.
T's Price/Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 26.60.
The Price/Forward Earnings ratio is 12.32, which indicates a correct valuation of T.
Based on the Price/Forward Earnings ratio, T is valued a bit cheaper than 75.76% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 22.39, T is valued a bit cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.71 | ||
| Fwd PE | 12.32 |
4.2 Price Multiples
T's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. T is cheaper than 69.70% of the companies in the same industry.
T's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.42 | ||
| EV/EBITDA | 7.15 |
4.3 Compensation for Growth
The decent profitability rating of T may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y0.69%
EPS Next 3Y4.34%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.00%, T has a reasonable but not impressive dividend return.
T's Dividend Yield is a higher than the industry average which is at 5.07.
Compared to an average S&P500 Dividend Yield of 2.39, T pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4% |
5.2 History
The dividend of T decreases each year by -10.97%.
T has been paying a dividend for at least 10 years, so it has a reliable track record.
T has decreased its dividend recently.
Dividend Growth(5Y)-10.97%
Div Incr Years0
Div Non Decr Years1
5.3 Sustainability
70.36% of the earnings are spent on dividend by T. This is not a sustainable payout ratio.
DP70.36%
EPS Next 2Y0.69%
EPS Next 3Y4.34%
NYSE:T (6/13/2025, 1:46:09 PM)
28.225
-0.04 (-0.16%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners63.96%
Inst Owner Change3.65%
Ins Owners0.06%
Ins Owner Change-0.54%
Market Cap203.10B
Analysts78.92
Price Target29.12 (3.17%)
Short Float %1.34%
Short Ratio2.46
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4% |
Yearly Dividend1.15
Dividend Growth(5Y)-10.97%
DP70.36%
Div Incr Years0
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)4.37%
Min EPS beat(2)2.7%
Max EPS beat(2)6.05%
EPS beat(4)3
Avg EPS beat(4)2.5%
Min EPS beat(4)-2.25%
Max EPS beat(4)6.05%
EPS beat(8)6
Avg EPS beat(8)1.15%
EPS beat(12)10
Avg EPS beat(12)2.39%
EPS beat(16)13
Avg EPS beat(16)2.81%
Revenue beat(2)0
Avg Revenue beat(2)-1.12%
Min Revenue beat(2)-1.17%
Max Revenue beat(2)-1.08%
Revenue beat(4)0
Avg Revenue beat(4)-1.83%
Min Revenue beat(4)-2.71%
Max Revenue beat(4)-1.08%
Revenue beat(8)0
Avg Revenue beat(8)-1.83%
Revenue beat(12)0
Avg Revenue beat(12)-1.84%
Revenue beat(16)0
Avg Revenue beat(16)-6.87%
PT rev (1m)4.76%
PT rev (3m)7.4%
EPS NQ rev (1m)0.26%
EPS NQ rev (3m)-0.96%
EPS NY rev (1m)0.22%
EPS NY rev (3m)0.35%
Revenue NQ rev (1m)0.01%
Revenue NQ rev (3m)0.77%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.29%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.71 | ||
| Fwd PE | 12.32 | ||
| P/S | 1.65 | ||
| P/FCF | 10.42 | ||
| P/OCF | 5.04 | ||
| P/B | 1.96 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.15 |
EPS(TTM)2.22
EY7.87%
EPS(NY)2.29
Fwd EY8.12%
FCF(TTM)2.71
FCFY9.6%
OCF(TTM)5.6
OCFY19.83%
SpS17.08
BVpS14.42
TBVpS-12.83
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 2.96% | ||
| ROE | 11.32% | ||
| ROCE | 6.98% | ||
| ROIC | 5.31% | ||
| ROICexc | 5.41% | ||
| ROICexgc | 12.65% | ||
| OM | 19.84% | ||
| PM (TTM) | 9.55% | ||
| GM | 59.9% | ||
| FCFM | 15.85% |
ROA(3y)1.35%
ROA(5y)1.32%
ROE(3y)5.03%
ROE(5y)4.74%
ROIC(3y)5.19%
ROIC(5y)4.76%
ROICexc(3y)5.26%
ROICexc(5y)4.87%
ROICexgc(3y)12.3%
ROICexgc(5y)11.33%
ROCE(3y)6.83%
ROCE(5y)6.27%
ROICexcg growth 3Y9.2%
ROICexcg growth 5Y-1.63%
ROICexc growth 3Y4.26%
ROICexc growth 5Y2.35%
OM growth 3Y0.54%
OM growth 5Y4.03%
PM growth 3Y-16.01%
PM growth 5Y2.75%
GM growth 3Y2.85%
GM growth 5Y2.22%
F-Score8
Asset Turnover0.31
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.13 | ||
| Debt/FCF | 6.47 | ||
| Debt/EBITDA | 2.6 | ||
| Cap/Depr | 100.29% | ||
| Cap/Sales | 16.91% | ||
| Interest Coverage | 3.56 | ||
| Cash Conversion | 89.28% | ||
| Profit Quality | 165.94% | ||
| Current Ratio | 0.7 | ||
| Quick Ratio | 0.65 | ||
| Altman-Z | 0.9 |
F-Score8
WACC7.14%
ROIC/WACC0.74
Cap/Depr(3y)100.82%
Cap/Depr(5y)90.95%
Cap/Sales(3y)15.8%
Cap/Sales(5y)13.85%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-5.93%
EPS 3Y-12.73%
EPS 5Y-8.79%
EPS Q2Q%-7.27%
EPS Next Y-7.74%
EPS Next 2Y0.69%
EPS Next 3Y4.34%
EPS Next 5Y6.07%
Revenue 1Y (TTM)0.5%
Revenue growth 3Y-3%
Revenue growth 5Y-7.56%
Sales Q2Q%1.99%
Revenue Next Year1.7%
Revenue Next 2Y1.52%
Revenue Next 3Y1.53%
Revenue Next 5Y2.18%
EBIT growth 1Y-1.17%
EBIT growth 3Y-2.47%
EBIT growth 5Y-3.83%
EBIT Next Year97.53%
EBIT Next 3Y28.45%
EBIT Next 5Y17.76%
FCF growth 1Y43.57%
FCF growth 3Y-11.18%
FCF growth 5Y-8.74%
OCF growth 1Y22.15%
OCF growth 3Y-2.6%
OCF growth 5Y-4.45%