Our top two telecom buys: AT&T Inc. and Verizon

Article Excerpt

AT&T INC. $31 (New York symbol T; Income Portfolio, Utilities sector; Shares outstanding: 7.3 billion; Market cap: $226.3 billion; Price-to-sales ratio: 1.3; Dividend yield: 6.6%; TSINetwork Rating: Average; www.att.com) completed its $103 billion cash-and-stock purchase of media giant TimeWarner (now called WarnerMedia) in June 2018. AT&T plans to use WarnerMedia’s content to attract more users to its wireless and TV services. In the three months ended March 31, 2019, AT&T’s revenue rose 17.8%, to $44.8 billion from $38.0 billion a year earlier. The latest results included $7.5 billion from WarnerMedia. The company reported fewer satellite and fibre-optic TV subscribers in the quarter due to competition from online video streaming services. However, it signed 80,000 new wireless subscribers (net of cancellations) to long-term contracts. That’s a big improvement over a net loss of 60,000 subscribers in the year-earlier quarter. AT&T’s earnings in the latest quarter fell 12.1%, to $4.10 billion from $4.66 billion, partly due to costs related to the WarnerMedia acquisition. Its per-share earnings declined…