AT&T Inc. has gotten itself out of its unwieldy media gamble, and the company is back to making strides in what it does best. The refined focus and wireless momentum have given the stock’s story a new shine, in the view of Argus analyst Joseph Bonner. He upgraded the stock to buy from hold Thursday.
wireless business has been a star in 2022 as the company has added substantial numbers of subscribers despite a price increase,” Bonner wrote in a note to clients. “Although it has not gained as many subscribers as industry leader T-Mobile, it has done better than Verizon’s subscriber losses and anemic numbers.” Read: AT&T exec says this trend should give investors ‘confidence’ Bonner noted that AT&T is now “past its long, sad foray into the media business,” having spun out WarnerMedia through a combination with Discovery. The company’s streamlined focus on telecommunications could come to benefit it in the event of a downturn, he added. “The wireless business may remain resilient in a recession, given the value subscribers put on wireless connectivity though a recession would likely hurt its commercial enterprise business,” he wrote. Recent financial decisions could pay off as well, according to Bonner, who had a $24 price target on the stock in his latest note. “While telecoms are typically seen as safe havens in turbulent economictimes, in AT&T’s case its focused debt reduction and refinancing in the last few years has made it more resilient in the current macro-environment,” Bonner noted. AT&T shares were down 0.8% in afternoon trading Thursday despite the downgrade. They’ve gained about 3% so far this year as the S&P 500
has fallen 17%.