Why This AT&T Analyst Expects The Telecom To Outrun Verizon

AT&T Inc. T is likely to outpace Verizon Communications Inc. VZ over the next few months, according to Raymond James.

The AT&T Analyst: Frank Louthan upgraded AT&T from Outperform to Strong Buy while maintaining a $24 price target. 

Related Link: AT&T Is 'Largely Solid' Judging From Q3 Beat, But Analysts Are Concerned: Here's Why

The AT&T Takeaways: While telcos face significant headwinds during an economic downturn, AT&T’s business is less cyclical and has better earnings growth than peers, Louthan said in the upgrade note.

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In a highly competitive environment, both AT&T and Verizon are marketing aggressively, the analyst said. Yet AT&T is achieving “superior wireless subscriber adds,” accelerating earnings growth and EBITDA margin expansion, he said. 

“As such, we believe AT&T can continue to outperform Verizon for the next few quarters,” Louthan said.

“We continue to believe a more focused vision along a simpler line of business creates a solid scenario for share price appreciation, and a solid, total return,” he added.

T Price Action: Shares of AT&T were trading 3.33% higher at $17.67 Monday morning. 

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