Market Overview

BoA Upgrades AT&T: 'The Landscape Has Dramatically Changed'

Share:
BoA Upgrades AT&T: 'The Landscape Has Dramatically Changed'
Related T
AT&T's 5G Rollout, Time Warner Acquisition Among The Pillars Of Tigress Financial's Bull Thesis
Benzinga's Week Ahead: Can Tech Earnings Restore The Rally? Amazon, Google To Report
AT&T Earnings: What Comes Next? (Seeking Alpha)

With the strain of the Time Warner trial now behind it, AT&T Inc. (NYSE: T) is back in favor with some Street analysts.

The Rating

Bank of America Merrill Lynch's David Barden and three other analysts upgraded AT&T from Neutral to Buy and maintained a $37 price target.

The Thesis

From the start, AT&T appears attractive with its price-to-earnings multiple at a 20-year low, the Time Warner merger driving cash and earnings accretion, wireless business trends exceeding expectations and “positive call optionality” from the union of AT&T’s distribution network with Time Warner’s content and advertising inventory, Barden said in the Monday note. (See the analyst's track record here.) 

The analyst previously based a Neutral rating on waning hope for corporate tax reform, expected flowback from the Time Warner merger, and rising competitive pressure.

“Fast forward to today and the landscape has dramatically changed,” Barden said. “Corporate tax reform has passed, deal flowback appears behind us, and Sprint Corp (NYSE: S) and T-Mobile Us Inc (NASDAQ: TMUS) are more focused on cash flow generation than price and market share.”

Bank of America expects AT&T’s first post-merger results to demonstrate positive wireless momentum, margin improvement in the entertainment segment and seasonal strength in Warner Media.

Price Action

AT&T shares were up 1.74 percent at $31.62 off the open Monday. 

Related Links:

UBS Telecom Analyst Talks AT&T's Q2

Raymond James: AT&T To Suffer Extended Overhang From DOJ Appeal

Photo courtesy of AT&T. 

Latest Ratings for T

DateFirmActionFromTo
Oct 2018Tigress FinancialUpgradesNeutralBuy
Sep 2018UBSUpgradesNeutralBuy
Sep 2018BarclaysMaintainsEqual-WeightEqual-Weight

View More Analyst Ratings for T
View the Latest Analyst Ratings

Posted-In: Bank of America Merrill Lynch David BardenAnalyst Color Upgrades Price Target Analyst Ratings Best of Benzinga

 

Related Articles (S + T)

View Comments and Join the Discussion!

Latest Ratings

StockFirmActionPT
ETTXWedbushInitiates Coverage On19.0
WINGWedbushDowngrades0.0
BMYCitigroupDowngrades57.0
INTCNomuraUpgrades0.0
HRZNKeefe Bruyette & WoodsDowngrades10.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

10 Biggest Price Target Changes For Monday

3 Reasons Why Cooper Companies Landed A KeyBanc Upgrade