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AT&T (T) Stock Sinks As Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, AT&T (T) closed at $38.49, marking a -0.26% move from the previous day. This change lagged the S&P 500's 0.03% gain on the day. Meanwhile, the Dow gained 0.11%, and the Nasdaq, a tech-heavy index, added 0.1%.

Prior to today's trading, shares of the telecommunications company had lost 2.62% over the past month. This has lagged the Computer and Technology sector's gain of 2.71% and the S&P 500's gain of 1.82% in that time.

Investors will be hoping for strength from T as it approaches its next earnings release. In that report, analysts expect T to post earnings of $0.88 per share. This would mark year-over-year growth of 2.33%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $46.99 billion, down 2.1% from the year-ago period.

T's full-year Zacks Consensus Estimates are calling for earnings of $3.57 per share and revenue of $181.36 billion. These results would represent year-over-year changes of +1.42% and +6.21%, respectively.

It is also important to note the recent changes to analyst estimates for T. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.05% lower within the past month. T is holding a Zacks Rank of #3 (Hold) right now.

Looking at its valuation, T is holding a Forward P/E ratio of 10.82. This represents a discount compared to its industry's average Forward P/E of 13.09.

Investors should also note that T has a PEG ratio of 2.43 right now. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Wireless National industry currently had an average PEG ratio of 3.19 as of yesterday's close.

The Wireless National industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 68, putting it in the top 27% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow T in the coming trading sessions, be sure to utilize Zacks.com.


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