AT&T (T, Financial) shares experienced an impressive rise of approximately 3.88% after the release of its third-quarter report. The stock's surge can be attributed to stronger-than-expected earning results, with a move up to a price of $22.335.
The telecommunications giant, AT&T (T, Financial), reported non-GAAP earnings of $0.60 per share, beating Wall Street's expectations of $0.57 per share. However, total sales reached $30.2 billion, slightly missing the anticipated $30.45 billion. Despite the sales shortfall, strong margins and promising guidance offered a positive outlook for the company.
In terms of subscriber growth, AT&T (T, Financial) added 403,000 postpaid phone subscriptions during the third quarter. Mobility services sales increased by 4% year-over-year, indicating robust demand in the wireless segment. Additionally, the company gained 226,000 new AT&T Fiber subscriptions—showcasing its 19th consecutive quarter with net additions exceeding 200,000. The total consumer broadband sales saw an increase of 6.4% compared to the previous year.
The business wireline segment has continued its decline, contributing to a 0.5% decrease in total sales compared to the prior-year period. Furthermore, adjusted earnings per share dropped by approximately 6%. Despite these challenges, AT&T (T, Financial) reaffirmed its full-year guidance with expectations of wireless services and broadband revenue growth of around 3% and more than 7%, respectively. The adjusted EBITDA is projected to grow by 3%, and the company is aiming for a net-debt-to-adjusted-EBITDA ratio of 2.5 by the first half of the upcoming year.
From a valuation perspective, AT&T (T, Financial) is currently trading with a price-to-earnings (P/E) ratio of 12.84 and a price-to-book (P/B) ratio of 1.52. The stock's GF Value is evaluated at $17.16, indicating that it might be GF Value. Despite the stock being near a 3-year high in terms of price, the Company remains competitive with a market capitalization of $160.1 billion. The Piotroski F-Score for AT&T (T) stands at 8, highlighting its healthy financial status.
Investors should consider the expansion of AT&T's (T, Financial) operating margins and the company's ongoing initiatives for debt reduction as positive factors. As the firm's focus remains on increasing its wireless and broadband services, AT&T (T) appears to be on a steadfast path, despite the pressures faced in other business segments.
