#10 - AT&T (NYSE:T)
AT&T (T) - Shares of AT&T (NYSE:T) have followed the path of most stocks during this correction. No more, but unfortunately no less. Nevertheless, the stock is still in positive territory over the last 12 months.
One reason why I like AT&T stock right now is that telecom stocks are good defensive stocks. This means they perform well regardless of what is happening in the broader economy. Certainly AT&T is expecting to get a boost from the 5G revolution, and the company was also forecasting a boost in retail sales with the launch of 5G offerings from Apple and other companies.
Both of those scenarios may be delivering less profit than AT&T was hoping for. Nevertheless, the company has diligently invested in other revenue streams. In 2018, AT&T paid $33 billion to acquire content from Time-Warner. This new business unit, Warner Media, which includes HBO, puts AT&T into the streaming wars.
And although there is some concern about the company’s future relationship with DirecTV, the company should still benefit this year. DirecTV will have the contract for the NFL Sunday Ticket through the 2020 season. And the Sunday Ticket is a significant profit driver for the company.
AT&T stock has a dividend yield of 6.04% and pays out an annual dividend of $2.08 per share. The company has posted annual dividend growth of 2% over the last three years and has 35 years of consecutive dividend growth.
About AT&T
AT&T Inc provides telecommunications and technology services worldwide. The company operates through two segments, Communications and Latin America. The Communications segment offers wireless voice and data communications services; and sells handsets, wireless data cards, wireless computing devices, carrying cases/protective covers, and wireless chargers through its own company-owned stores, agents, and third-party retail stores.
Read More - Current Price
- $23.18
- Consensus Rating
- Moderate Buy
- Ratings Breakdown
- 11 Buy Ratings, 7 Hold Ratings, 1 Sell Ratings.
- Consensus Price Target
- $23.40 (0.9% Upside)
Markets hate uncertainty. And there is no question that the coronavirus is delivering a level of uncertainty to global supply chains. Already many companies are issuing travel bans to China and consumers are debating whether to follow through with travel plans. But for most investors, now is not a time to panic. But it may require making some prudent adjustments.
When “Black Swan” events such as the coronavirus occur, it’s easy to identify the sectors that are under pressure. Travel stocks and energy stocks are under pressure as investors try to ascertain the long-term effect on travel and tourism. Airline stocks and hotel stocks are eagerly waiting for business travel to return to normal. Even a stock like Apple (NASDAQ:AAPL) is under pressure because of their manufacturing exposure in China. This continues even as CEO Tim Cook is attempting to reassure investors.
It can be harder to see the silver linings. But you don’t have to wait on the sidelines or park your money in U.S. Treasuries that are seeing their yield drop to historic lows. It’s unlikely for you to expect the same total return you got in 2019. However, the prudent addition of some of these dividend aristocrats can provide some much-needed stability to your portfolio.
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