AT&T INC (T) Stock Fundamental Analysis
NYSE:T - New York Stock Exchange, Inc. - US00206R1023 - Common Stock - Currency: USD
T gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 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 it does not seem to be growing.
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
T's Return On Assets of 2.96% is fine compared to the rest of the industry. T outperforms 63.64% of its industry peers.
Looking at the Return On Equity, with a value of 11.32%, T is in the better half of the industry, outperforming 69.70% of the companies in the same industry.
With a decent Return On Invested Capital value of 5.31%, T is doing good in the industry, outperforming 69.70% of the companies in the same industry.
T had an Average Return On Invested Capital over the past 3 years of 5.19%. This is below the industry average of 7.60%.
The 3 year average ROIC (5.19%) for T is below the current ROIC(5.31%), indicating increased profibility in the last year.
| 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
With a decent Profit Margin value of 9.55%, T is doing good in the industry, outperforming 66.67% of the companies in the same industry.
T's Profit Margin has improved in the last couple of years.
T's Operating Margin of 19.84% is fine compared to the rest of the industry. T outperforms 75.76% of its industry peers.
In the last couple of years the Operating Margin of T has grown nicely.
Looking at the Gross Margin, with a value of 59.90%, T is in line with its industry, outperforming 57.58% of the companies in the same industry.
T's Gross Margin has improved in the last couple of years.
| 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.
The number of shares outstanding for T has been reduced compared to 5 years ago.
T has a better debt/assets ratio than last year.
2.2 Solvency
T has an Altman-Z score of 0.89. This is a bad value and indicates that T is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of T (0.89) is comparable to the rest of the industry.
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.
T has a better Debt to FCF ratio (6.47) than 72.73% of its industry peers.
T has a Debt/Equity ratio of 1.13. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 1.13, T is in line with its industry, outperforming 51.52% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.13 | ||
| Debt/FCF | 6.47 | ||
| Altman-Z | 0.89 |
ROIC/WACC0.74
WACC7.15%
2.3 Liquidity
A Current Ratio of 0.70 indicates that T may have some problems paying its short term obligations.
T has a Current ratio of 0.70. This is in the lower half of the industry: T underperforms 78.79% of its industry peers.
A Quick Ratio of 0.65 indicates that T may have some problems paying its short term obligations.
The Quick ratio of T (0.65) is worse than 78.79% 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%.
Measured over the past years, T shows a decrease in Earnings Per Share. The EPS has been decreasing by -8.79% on average per year.
The Revenue has been growing slightly by 0.50% in the past year.
Measured over the past years, T shows a decrease in Revenue. The Revenue has been decreasing by -7.56% on average per year.
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
The Earnings Per Share is expected to grow by 4.72% on average over the next years.
The Revenue is expected to grow by 2.27% on average over the next years.
EPS Next Y-7.74%
EPS Next 2Y0.69%
EPS Next 3Y4.34%
EPS Next 5Y4.72%
Revenue Next Year1.7%
Revenue Next 2Y1.53%
Revenue Next 3Y1.56%
Revenue Next 5Y2.27%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 12.39, which indicates a correct valuation of T.
Based on the Price/Earnings ratio, T is valued a bit cheaper than 72.73% of the companies 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.
With a Price/Forward Earnings ratio of 12.01, T is valued correctly.
T's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. T is cheaper than 75.76% of the companies in the same industry.
T is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.43, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.39 | ||
| Fwd PE | 12.01 |
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.
The rest of the industry has a similar Price/Free Cash Flow ratio as T.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.16 | ||
| EV/EBITDA | 7.08 |
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 4.06%, T is a good candidate for dividend investing.
T's Dividend Yield is a higher than the industry average which is at 4.76.
T's Dividend Yield is rather good when compared to the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.06% |
5.2 History
The dividend of T decreases each year by -10.97%.
T has paid a dividend for at least 10 years, which is 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
T pays out 70.36% of its income as dividend. This is not a sustainable payout ratio.
DP70.36%
EPS Next 2Y0.69%
EPS Next 3Y4.34%
NYSE:T (5/21/2025, 10:20:09 AM)
27.51
-0.27 (-0.97%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners63.96%
Inst Owner Change3.43%
Ins Owners0.06%
Ins Owner Change0.52%
Market Cap197.95B
Analysts78.92
Price Target29 (5.42%)
Short Float %1.35%
Short Ratio2.26
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.06% |
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)5.44%
PT rev (3m)10.91%
EPS NQ rev (1m)-1.42%
EPS NQ rev (3m)-1.22%
EPS NY rev (1m)0.22%
EPS NY rev (3m)0.38%
Revenue NQ rev (1m)0.8%
Revenue NQ rev (3m)0.76%
Revenue NY rev (1m)0.37%
Revenue NY rev (3m)0.28%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.39 | ||
| Fwd PE | 12.01 | ||
| P/S | 1.61 | ||
| P/FCF | 10.16 | ||
| P/OCF | 4.92 | ||
| P/B | 1.91 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.08 |
EPS(TTM)2.22
EY8.07%
EPS(NY)2.29
Fwd EY8.33%
FCF(TTM)2.71
FCFY9.85%
OCF(TTM)5.6
OCFY20.34%
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 | 0.89 |
F-Score8
WACC7.15%
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 5Y4.72%
Revenue 1Y (TTM)0.5%
Revenue growth 3Y-3%
Revenue growth 5Y-7.56%
Sales Q2Q%1.99%
Revenue Next Year1.7%
Revenue Next 2Y1.53%
Revenue Next 3Y1.56%
Revenue Next 5Y2.27%
EBIT growth 1Y-1.17%
EBIT growth 3Y-2.47%
EBIT growth 5Y-3.83%
EBIT Next Year97.88%
EBIT Next 3Y28.35%
EBIT Next 5Y17.72%
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%