AT&T INC (T) Stock Fundamental Analysis
USA - New York Stock Exchange - NYSE:T - US00206R1023 - Common Stock
25.82 USD
-0.04 (-0.15%)
25.86 USD
+0.04 (+0.15%)
Taking everything into account, T scores 5 out of 10 in our fundamental rating. T was compared to 37 industry peers in the Diversified Telecommunication Services industry. While T has a great profitability rating, there are quite some concerns on its financial health. T is valued correctly, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year T was profitable.
In the past year T had a positive cash flow from operations.
The reported net income has been mixed in the past 5 years: T reported negative net income in multiple years.
T had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
T has a Return On Assets of 5.24%. This is in the better half of the industry: T outperforms 78.38% of its industry peers.
The Return On Equity of T (20.02%) is better than 86.49% of its industry peers.
Looking at the Return On Invested Capital, with a value of 4.98%, T is in the better half of the industry, outperforming 62.16% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for T is in line with the industry average of 6.50%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.24% | ||
| ROE | 20.02% | ||
| ROIC | 4.98% |
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
The Profit Margin of T (17.81%) is better than 86.49% of its industry peers.
T's Profit Margin has improved in the last couple of years.
With a decent Operating Margin value of 19.44%, T is doing good in the industry, outperforming 75.68% of the companies in the same industry.
In the last couple of years the Operating Margin of T has grown nicely.
T has a Gross Margin (59.67%) which is in line with its industry peers.
T's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 19.44% | ||
| PM (TTM) | 17.81% | ||
| GM | 59.67% |
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.
Compared to 1 year ago, T has more shares outstanding
T has less shares outstanding than it did 5 years ago.
The debt/assets ratio for T has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 0.88, we must say that T is in the distress zone and has some risk of bankruptcy.
T's Altman-Z score of 0.88 is in line compared to the rest of the industry. T outperforms 54.05% of its industry peers.
The Debt to FCF ratio of T is 6.99, which is on the high side as it means it would take T, 6.99 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of T (6.99) is better than 75.68% of its industry peers.
T has a Debt/Equity ratio of 1.16. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.16, T perfoms like the industry average, outperforming 48.65% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.16 | ||
| Debt/FCF | 6.99 | ||
| Altman-Z | 0.88 |
ROIC/WACC0.73
WACC6.78%
2.3 Liquidity
A Current Ratio of 1.01 indicates that T should not have too much problems paying its short term obligations.
T has a Current ratio (1.01) which is in line with its industry peers.
T has a Quick Ratio of 1.01. 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 Quick ratio of 0.96. This is comparable to the rest of the industry: T outperforms 43.24% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.01 | ||
| Quick Ratio | 0.96 |
3. Growth
3.1 Past
The earnings per share for T have decreased by -5.75% in the last year.
T shows a decrease in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -8.79% yearly.
T shows a small growth in Revenue. In the last year, the Revenue has grown by 1.98%.
T shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -7.56% yearly.
EPS 1Y (TTM)-5.75%
EPS 3Y-12.73%
EPS 5Y-8.79%
EPS Q2Q%-10%
Revenue 1Y (TTM)1.98%
Revenue growth 3Y-3%
Revenue growth 5Y-7.56%
Sales Q2Q%1.64%
3.2 Future
Based on estimates for the next years, T will show a small growth in Earnings Per Share. The EPS will grow by 5.70% on average per year.
T is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.26% yearly.
EPS Next Y-7.43%
EPS Next 2Y0.43%
EPS Next 3Y4.06%
EPS Next 5Y5.7%
Revenue Next Year2.27%
Revenue Next 2Y1.86%
Revenue Next 3Y1.95%
Revenue Next 5Y2.26%
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
Based on the Price/Earnings ratio of 12.12, the valuation of T can be described as correct.
Compared to the rest of the industry, the Price/Earnings ratio of T indicates a rather cheap valuation: T is cheaper than 83.78% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 26.15, T is valued rather cheaply.
With a Price/Forward Earnings ratio of 11.33, the valuation of T can be described as very reasonable.
Based on the Price/Forward Earnings ratio, T is valued cheaper than 86.49% of the companies in the same industry.
T is valuated cheaply when we compare the Price/Forward Earnings ratio to 36.12, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.12 | ||
| Fwd PE | 11.33 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, T is valued a bit cheaper than the industry average as 72.97% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, T is valued a bit cheaper than the industry average as 62.16% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.17 | ||
| EV/EBITDA | 6.67 |
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 2Y0.43%
EPS Next 3Y4.06%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 4.35%, T is a good candidate for dividend investing.
T's Dividend Yield is a higher than the industry average which is at 5.78.
Compared to an average S&P500 Dividend Yield of 2.41, T pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.35% |
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
37.01% of the earnings are spent on dividend by T. This is a low number and sustainable payout ratio.
DP37.01%
EPS Next 2Y0.43%
EPS Next 3Y4.06%
25.82
-0.04 (-0.15%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupTelecommunication Services
GICS IndustryDiversified Telecommunication Services
Earnings (Last)
Earnings (Next)
Inst Owners66.66%
Inst Owner Change-3.95%
Ins Owners0.06%
Ins Owner Change-0.13%
Market Cap183.05B
Revenue(TTM)124.48B
Net Income(TTM)22.17B
Analysts78.24
Price Target30.07 (16.46%)
Short Float %1.21%
Short Ratio1.7
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 4.35% |
Yearly Dividend1.15
Dividend Growth(5Y)-10.97%
DP37.01%
Div Incr Years0
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.95%
Min EPS beat(2)-0.97%
Max EPS beat(2)2.87%
EPS beat(4)3
Avg EPS beat(4)2.66%
Min EPS beat(4)-0.97%
Max EPS beat(4)6.05%
EPS beat(8)5
Avg EPS beat(8)0.93%
EPS beat(12)9
Avg EPS beat(12)1.37%
EPS beat(16)12
Avg EPS beat(16)1.73%
Revenue beat(2)0
Avg Revenue beat(2)-1.65%
Min Revenue beat(2)-2.47%
Max Revenue beat(2)-0.84%
Revenue beat(4)0
Avg Revenue beat(4)-1.39%
Min Revenue beat(4)-2.47%
Max Revenue beat(4)-0.84%
Revenue beat(8)0
Avg Revenue beat(8)-1.81%
Revenue beat(12)0
Avg Revenue beat(12)-1.87%
Revenue beat(16)0
Avg Revenue beat(16)-4.61%
PT rev (1m)-0.2%
PT rev (3m)0.03%
EPS NQ rev (1m)2.79%
EPS NQ rev (3m)2.34%
EPS NY rev (1m)0.26%
EPS NY rev (3m)-0.08%
Revenue NQ rev (1m)0.21%
Revenue NQ rev (3m)0.15%
Revenue NY rev (1m)-0.1%
Revenue NY rev (3m)-0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.12 | ||
| Fwd PE | 11.33 | ||
| P/S | 1.47 | ||
| P/FCF | 9.17 | ||
| P/OCF | 4.48 | ||
| P/B | 1.65 | ||
| P/tB | N/A | ||
| EV/EBITDA | 6.67 |
EPS(TTM)2.13
EY8.25%
EPS(NY)2.28
Fwd EY8.83%
FCF(TTM)2.81
FCFY10.9%
OCF(TTM)5.76
OCFY22.32%
SpS17.56
BVpS15.62
TBVpS-12.09
PEG (NY)N/A
PEG (5Y)N/A
Graham Number27.36
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 5.24% | ||
| ROE | 20.02% | ||
| ROCE | 6.55% | ||
| ROIC | 4.98% | ||
| ROICexc | 5.27% | ||
| ROICexgc | 12.06% | ||
| OM | 19.44% | ||
| PM (TTM) | 17.81% | ||
| GM | 59.67% | ||
| FCFM | 16.03% |
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%
ROICexgc growth 3Y9.2%
ROICexgc 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-Score7
Asset Turnover0.29
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.16 | ||
| Debt/FCF | 6.99 | ||
| Debt/EBITDA | 2.83 | ||
| Cap/Depr | 98.92% | ||
| Cap/Sales | 16.79% | ||
| Interest Coverage | 3.62 | ||
| Cash Conversion | 90.13% | ||
| Profit Quality | 90.02% | ||
| Current Ratio | 1.01 | ||
| Quick Ratio | 0.96 | ||
| Altman-Z | 0.88 |
F-Score7
WACC6.78%
ROIC/WACC0.73
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)-5.75%
EPS 3Y-12.73%
EPS 5Y-8.79%
EPS Q2Q%-10%
EPS Next Y-7.43%
EPS Next 2Y0.43%
EPS Next 3Y4.06%
EPS Next 5Y5.7%
Revenue 1Y (TTM)1.98%
Revenue growth 3Y-3%
Revenue growth 5Y-7.56%
Sales Q2Q%1.64%
Revenue Next Year2.27%
Revenue Next 2Y1.86%
Revenue Next 3Y1.95%
Revenue Next 5Y2.26%
EBIT growth 1Y-1.92%
EBIT growth 3Y-2.47%
EBIT growth 5Y-3.83%
EBIT Next Year97.59%
EBIT Next 3Y28.47%
EBIT Next 5Y17.67%
FCF growth 1Y0.95%
FCF growth 3Y-11.18%
FCF growth 5Y-8.74%
OCF growth 1Y9.69%
OCF growth 3Y-2.6%
OCF growth 5Y-4.45%
AT&T INC / T FAQ
What is the fundamental rating for T stock?
ChartMill assigns a fundamental rating of 5 / 10 to T.
Can you provide the valuation status for AT&T INC?
ChartMill assigns a valuation rating of 6 / 10 to AT&T INC (T). This can be considered as Fairly Valued.
What is the profitability of T stock?
AT&T INC (T) has a profitability rating of 7 / 10.
Can you provide the PE and PB ratios for T stock?
The Price/Earnings (PE) ratio for AT&T INC (T) is 12.12 and the Price/Book (PB) ratio is 1.65.
What is the earnings growth outlook for AT&T INC?
The Earnings per Share (EPS) of AT&T INC (T) is expected to decline by -7.43% in the next year.