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2023-12-16
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The stock of Rivian Automotive (NASDAQ: RIVN) has soared 30% in the past month, but shares are still off 87% from all-time highs. The fast-growing electric vehicle (EV) start-up has gone through a brutal drawdown since its initial public offering in late 2021, with investors concerned about a lack of profitability and a crowded EV sector.
A look under the hood (financially speaking) shows that Rivian continues to scale its operations and is getting closer to breakeven. With shares down in the dumps, does that mean Rivian stock is set to make a comeback in 2024? Let's investigate.
Scaling-up production, winning large commercial customers
Rivian has attacked the EV sector from a different angle than leader Tesla. It is starting out by producing larger vehicles such as pick-up trucks, SUVs, and commercial vans.
Its R1T premium pick-up has been a hit with wealthier customers across the United States, with the SUV called the R1S set to begin deliveries to customers sometime within the next few quarters.
From the fourth quarter of 2021 to the third quarter of 2023 -- less than two years -- Rivian has grown its quarterly vehicle production from 1,000 to 16,300. In 2023, it expects to produce 54,000 EVs, which would already make it one of the largest EV makers in the United States. It still has a long way to go to catch Tesla, which is producing over 1 million EVs every year.
One benefit for Rivian compared to other EV start-ups is its commercial business. It has a huge contract with Amazon for 100,000 delivery vans. Other companies want to get in on the action, with AT&T recently announcing a deal with Rivian.
All together, it looks like Rivian has multiple years of runway ahead to grow its EV operations.
Does it have enough cash to survive?
The looming problem with Rivian is that it is still too sub-scale to generate positive cash flow. Building out an automotive manufacturing business is extremely capital intensive and requires massive scale in order to make the unit economics work.
For reference, Rivian is still generating negative gross margins, although they have been moving rapidly in the right direction for the last few quarters.
Over the last 12 months, Rivian has burned $6.2 billion in free cash flow. The company ended the third quarter with just over $9 billion in cash and equivalents on its balance sheet.
It's not hard to run the math on this one: The company has about a year and a half at its current burn rate before its coffers are empty. This paints a bleak picture for the business.
However, when scaling up car manufacturing, it always looks dark before the operating leverage starts to kick in. Once Tesla scaled its business to much greater heights in the 2018-2020 period, it went from burning close to $5 billion in free cash flow to positive cash generation in one to two years.
If Rivian can keep scaling its operations and start delivering hundreds of thousands of vehicles to its individual and commercial customers, the company will likely survive through this dark period.
RIVN free cash flow data by YCharts.
Avoid all EV stocks, not just Rivian
Even if Rivian has some light at the end of the tunnel, the EV sector looks like a poor place for investors to put their money. It is capital-intensive, has a ton of competitors, and is a classic candidate for following capital cycle theory, which has a whole book dedicated to it.
The idea can be summed up as profits (and therefore investor returns) getting depressed when a flood of competition and dollars flow into a sector ahead of customer demand. This sounds like the EV sector in 2023.
Despite the hype around the electrification of the automotive sector, the industry has put up poor investing performance for decades. Finding the right sectors to invest in might be more important than finding individual companies to put your money toward. Investors would be wise to avoid the EV sector and buy some blue chip stocks with high returns on invested capital instead.
Should you invest $1,000 in Rivian Automotive right now?
Before you buy stock in Rivian Automotive, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Rivian Automotive wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Brett Schafer has positions in Amazon. The Motley Fool has positions in and recommends Amazon and Tesla. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-16
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Dividend stocks can offer a valuable source of income for investors who want to diversify their portfolios. However, investors should also be aware that most of these stocks will gradually decline in value over time unless the dividend is reinvested.
This may seem surprising, but ample evidence supports this claim. Only a few dividend stocks have been able to provide cash payments to shareholders consistently while also increasing their share prices over time.
Two of the most popular dividend stocks in the market today are AT&T (NYSE: T) and AbbVie (NYSE: ABBV), but they have different appeals. AT&T is attractive for its high yield, currently 6.72%. AbbVie also has a decent yield of 4.02% and has established itself as a leading dividend growth stock and reliable passive income source for shareholders. To illustrate these points, the company has increased its dividend by 287.5% since it spun off from Abbott Laboratories in 2013, and it is a Dividend King due to its heritage.
Image source: Getty Images.
Which of these top dividend stocks is the better income play? Let's dig deeper to find out.
The case for AT&T
Over the next few years, AT&T is expected to steadily reduce its debt thanks to its improved free cash flows and lower costs. The company should also face less competitive pressure from its rivals because the U.S. wireless market has become more stable after T-Mobile's merger with Sprint and the completion of the 5G network rollout.
Lastly, AT&T's stock screens as markedly undervalued, with its shares trading at less than 7 times expected earnings. In fact, the telecom giant's stock is currently trading near a historical low on this classic valuation metric.
The case for AbbVie
AbbVie is a biopharmaceutical company that rewards its shareholders with a generous and growing dividend. The company has a proven track record of delivering strong revenue growth and expanding its market share in autoimmune diseases, where its best-selling drug, Humira, is a market share leader in multiple indications. AbbVie has also diversified its portfolio into other lucrative areas, such as oncology, with breakthrough drugs like Imbruvica for various blood cancers.
The company has a solid pipeline of innovative drugs, and its recent acquisitions could add more value to its business. AbbVie's dividend yield is slightly higher than the average for its industry, and its stock is trading at a low valuation compared to its peers at less than 14 times forward earnings. However, Humira's sales are declining due to biosimilar competition, and novel branded competitors could further challenge its dominance in immunology over the next five to 10 years.
Verdict
AbbVie scans as the better buy in this comparison. The drugmaker is facing some important challenges, but it also operates in a fast-growing and dynamic healthcare sector that benefits from favorable demographic trends, scientific breakthroughs, and robust global demand.
AT&T, on the other hand, is struggling to grow its sales in a mature and highly competitive U.S. telecom market. So, even though it offers a higher dividend yield, AT&T stock may not be as appealing as AbbVie's at the moment.
Should you invest $1,000 in AT&T right now?
Before you buy stock in AT&T, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and AT&T wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than tripled the return of S&P 500 since 2002*.
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George Budwell has positions in AT&T. The Motley Fool has positions in and recommends Abbott Laboratories. The Motley Fool recommends T-Mobile US. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-16
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Telecom veteran AT&T (NYSE: T) has delivered dividends to investors for decades. Rival T-Mobile (NASDAQ: TMUS) followed suit in 2023, offering a dividend for the first time in company history with an inaugural payment on Dec. 15.
AT&T boasts the greater dividend yield, currently at 6.8%, compared to T-Mobile's 1.6%. From that perspective, AT&T looks like the better choice. If only it were that easy.
Other factors beyond a high yield should be considered before deciding to buy a dividend stock, such as whether the company can afford its dividend. But what are these factors to sway your decision when choosing between AT&T and T-Mobile?
To answer that question, let's examine each company in more detail to determine which is the better dividend stock.
AT&T: Dealing with debt
Before choosing AT&T for its dividend, a key consideration is its massive debt burden. The company exited the third quarter with a whopping $126.7 billion in long-term debt. Contrast this with T-Mobile's Q3 long-term debt of $70.4 billion.
AT&T's debt may preclude it from raising its dividend as the company works to get its debt load down to a manageable level. In fact, AT&T cut its dividend nearly in half in 2022 as part of its divestiture of entertainment-related assets, and hasn't increased it since.
The company's goal is to achieve a net debt-to-adjusted EBITDA ratio in the 2.5x range, and it may not raise its dividend until after this goal is met. AT&T estimates it can reach this target in the first half of 2025.
Despite the substantial debt, AT&T's dividend looks secure. The company generated $5.2 billion in Q3 free cash flow (FCF), an impressive year-over-year increase of $1.3 billion. FCF provides insight into the cash a company has available to invest in its business, pay debt, and repurchase shares or fund dividends.
AT&T's FCF is excellent thanks to strong customer growth. Q3 represented the company's 13th consecutive quarter of net growth in its postpaid phone subscriptions, the telecom industry's key revenue-generating customer segment.
AT&T's impressive streak of customer growth led to $15.9 billion in Q3 wireless service sales, a 3.7% year-over-year increase. This represents over half of AT&T's Q3 total revenue of $30.4 billion.
T-Mobile: New to dividends
Since T-Mobile just started dividend payments, no history exists to gauge how dependable this passive income source will be over time. For now, the company plans to increase its dividend annually by about 10%.
And while T-Mobile's dividend yield isn't as high as AT&T's, it does offer a higher payout. T-Mobile pays $0.65 per share owned. AT&T pays $0.28 per share.
T-Mobile can afford to fund its dividend thanks to strong customer growth. In Q3, T-Mobile captured a net addition of 850,000 postpaid phone subscribers, substantially higher than the 468,000 delivered by AT&T for the quarter. It's one of the reasons why T-Mobile shares hover around a 52-week high at the time of this writing.
Thanks to its ability to acquire customers, T-Mobile achieved a 3.6% year-over-year increase in Q3 wireless service sales, accounting for $15.9 billion of the company's $19.3 billion in Q3 revenue. This revenue growth contributed to T-Mobile's excellent FCF generation.
The company's Q3 adjusted free cash flow was $4 billion, a jaw-dropping 94% increase over the $2.1 billion in 2022. The company expects full-year FCF to hit at least $13.4 billion.
The better choice for income investors
Making a choice between AT&T and T-Mobile is a difficult decision. Each offers reasons to buy. But in choosing between the two, another factor to consider is the valuation of T-Mobile stock compared to AT&T, especially since the former is around its 52-week high.
T-Mobile's forward price-to-earnings ratio (forward P/E) is about 20, whereas AT&T's forward P/E is around 7. So T-Mobile shares are pretty expensive compared to its telecom competitor.
Moreover, AT&T forecasted full-year FCF of at least $16.5 billion. That's more than $3 billion more than T-Mobile's projected 2023 FCF of $13.4 billion. AT&T's strong FCF generation indicates it's in a position to pay down its debt while continuing to fund the dividend.
When considering valuation on top of AT&T's superior dividend yield and FCF generation, at this time, the company possesses enough of an edge against T-Mobile to be the better choice as a dividend stock.
Should you invest $1,000 in AT&T right now?
Before you buy stock in AT&T, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and AT&T wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than tripled the return of the S&P 500 since 2002*.
See the 10 stocks
*Stock Advisor returns as of December 11, 2023
Robert Izquierdo has positions in AT&T and T-Mobile US. The Motley Fool recommends T-Mobile US. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-16
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T
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Below is Validea's guru fundamental report for AT&T INC. (T). Of the 22 guru strategies we follow, T rates highest using our Shareholder Yield Investor model based on the published strategy of Meb Faber. This strategy looks for companies returning cash to shareholders via dividends, buybacks and debt paydown.
AT&T INC. (T) is a large-cap growth stock in the Communications Services industry. The rating using this strategy is 95% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
UNIVERSE: PASS
NET PAYOUT YIELD: PASS
QUALITY AND DEBT: PASS
VALUATION: PASS
RELATIVE STRENGTH: PASS
SHAREHOLDER YIELD: PASS
Detailed Analysis of AT&T INC.
T Guru Analysis
T Fundamental Analysis
More Information on Meb Faber
Meb Faber Portfolio
About Meb Faber: Meb Faber is the founder of Cambria Investments. His research has covered a wide spectrum of the investment world, including topics like shareholder yield, trend following, global asset allocation and home country bias. His shareholder yield strategy, which is based on his book "Shareholder Yield" and forms the basis for an ETF of the same name, looks for companies that are focused on creating value for shareholders by returning cash to them in the form of dividends, share buybacks and debt paydown. Meb is also the author of 4 other books and numerous white papers on investing related topics.
Additional Research Links
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About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-16
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Comcast’s CMCSA Xfinity 10G Network offers an unparalleled gaming experience. The company recently partnered with the Esports Awards to set a Guinness World Record for the Largest Digital Video Game Display.
Speed is crucial in the realm of gaming. Comcast, the largest gigabit+ Internet provider in the country, pioneered multi-gig symmetrical speeds via a DOCSIS 4.0 connection. This ensures Xfinity customers can swiftly download large game files and enjoy faster gameplay with minimal interruptions.
Reliability is paramount in co-op gaming. Comcast addresses this with the Comcast Octave platform, which optimizes Internet delivery using AI and machine learning. The platform monitors telemetry data on more than 50 million modems every 20 minutes, thus ensuring a more reliable and faster network down to the household level.
Xfinity's latest gateways support WiFi 6E technology, allowing gamers to maintain peak performance even when other household members engage in activities like streaming in 4K or video chatting. With three times the bandwidth, WiFi 6E powers the entire household, eliminating the need for prioritizing online connections.
This is expected to aid Comcast’s total domestic broadband customers in the upcoming quarters.
The Zacks Consensus Estimate for the company’s 2023 total domestic broadband customers is pegged at 32.25 million, indicating year-over-year growth of 0.29%. The consensus mark for earnings is pegged at $3.94 per share, indicating year-over-year growth of 8.24%.
Comcast Corporation Price and Consensus
Comcast Corporation price-consensus-chart | Comcast Corporation Quote
Xfinity Excels as Esports and Gaming Leader
When it comes to gaming, a reliable Internet service that delivers speed while minimizing lag is crucial. This is precisely why serious gamers are turning to the Xfinity 10G Network as their preferred Internet provider. The network has experienced remarkable growth, with gaming consoles connected to it surpassing 37 million in 2022.
The prestigious Tempest Awards, recognizing excellence in the esports and gaming business, crowned Xfinity as the 2023 Brand of the Year. Additionally, Xfinity earned a nomination for Best Endemic Brand, particularly for the launch of the new Xfinity 10G Network during the Super Bowl.
Shares of CMCSA, which currently carries a Zacks Rank #2 (Buy), have returned 27.2% year to date compared with the Zacks Consumer Discretionary sector’s 16.6% rise because it has notable partnerships in the gaming industry. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Xfinity has consistently emphasized its commitment to gaming by partnering with industry leaders such as Twitch, FaZe Clan, IGN and Microsoft’s MSFT Call of Duty to showcase the gaming prowess of the Xfinity 10G Internet.
The partnership with FaZe Clan extends to hosting events like "The Gig," a gaming and music experience in Boston and Atlanta, featuring a top-tier gaming lounge, musical performances and community support through donations to local foundations.
Xfinity's collaboration with Microsoft extends to providing Xfinity Rewards Members with free early access to the Call of Duty Beta, a highly popular reward among members for three consecutive years. This demonstrates Xfinity's dedication to enhancing the gaming experience for its users.
It faces tough competition from players like AT&T T and Verizon Communications VZ in the telecommunications market.
AT&T, a major wireless service provider in North America and a global communications service provider, offers a diverse range of communication and business solutions through its subsidiary and affiliate network. These include wireless services, phone services, data and broadband, Internet access, video streaming, managed networking, wholesale offerings and cloud-based services. Operating as a telecommunication, media and technology company, AT&T provides telephone and Internet services, telecom equipment, wireless communications and managed networking.
Verizon, an American multinational telecommunications conglomerate, is a major player in the digital media sector through its subsidiaries Verizon Media and Oath Inc. While competing with Comcast in telecommunications and media, it's noteworthy that Comcast operates its cell phone service using Verizon's network. In 2021, Verizon set a goal to bring Ultra Wideband 5G to 175 million people between 2022 and 2023. Verizon aims to cover at least 250 million people by the end of 2024, establishing itself as a strong competitor to Comcast in the industry.
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AT&T Inc. (T) : Free Stock Analysis Report
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To read this article on Zacks.com click here.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-16
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Altria (NYSE: MO) and AT&T (NYSE: T) are two big names for many dividend investors, and it's no mystery why. While both stocks are trailing the S&P 500 over the past five years, they offer two of the highest dividend yields in the index.
While Altria sports a 9.3% yield at recent prices and AT&T is a few steps behind at 6.7%, I think there are three reasons it takes a back seat to AT&T.
1. AT&T has big trends on its side
Smoking in the U.S. has been declining for a while now. In 2005, around 21% of U.S. adults smoked tobacco; in 2021, that had dropped to 11.5%. For Altria, the largest tobacco company in the country, volume growth has felt the effect. In the third quarter, it reported its U.S. shipment volume declined by 11.6%.
Luckily for Altria, its pricing power has offset the volume drop over the years. The addictive nature of nicotine means people don't generally stop buying tobacco just because it went up in price. But at some point, the company will need a solution that isn't just raising prices.
I think it's hard to know when that will be with Altria consumers, but at some point, the company will need a viable income stream aside from its tobacco products. It's made attempts to adjust to the market by selling its own e-cigarettes, but most of those products have been discontinued with little to no success to show for it.
While Altria is experiencing volume issues, AT&T's customer growth is headed in the right direction. With the expansion of 5G coverage in the U.S. and the growth of fiber internet, AT&T has two core business segments that should experience good growth in the coming years. According to Ericsson -- which just struck a five-year, $14 billion deal with AT&T -- 5G will account for around 71.5% of the U.S. mobile market by 2029. Fiber is also only available to around 40% of Americans, so there's plenty of room to go.
2. AT&T has made debt reduction a priority
When AT&T decided to pursue its media and entertainment (M&E) ambitions, it took on a lot of debt to make it happen. In retrospect, I think AT&T and its investors would agree that its M&E moves turned out to be some of the worst in its history -- probably topped by its $85 billion acquisition of Time Warner, which closed in 2018.
Things have improved since it spun off WarnerMedia in early 2022 for $43 billion. In the first quarter of 2022, AT&T reported $180 billion in long-term debt. It has since knocked that total down to $138 billion (as of Sept. 30). That's still a lot of debt, but the company's free cash flow has given it enough room to be aggressive with its debt repayments over the coming years.
T Total Long Term Debt (Quarterly) data by YCharts
In the third quarter, AT&T reported $5.2 billion in free cash flow, up $1.4 billion year over year, and raised its full-year free-cash-flow guidance to $16.5 billion. This should help it achieve its goal of a net debt-to-adjusted EBITDA in the 2.5 range by 2025, down from 3.22 in the third quarter of 2022. Altria's was 2.1 at the end of the 2023 third quarter.
Altria has much less long-term debt than AT&T (just under $24 billion), but its operations rely heavily on it, as you can see in this comparison of the two companies' debt-to-assets ratios.
T Debt to Assets (Quarterly) data by YCharts
3. AT&T's valuation gives it a little more upside
AT&T seems to have turned the corner from its recent woes -- maybe not completely, but investors can see brighter days ahead with its recent performance.
Altria still seems to have many questions regarding how effective it can be in diversifying away from cigarettes and competing in segments like vaping. It also doesn't help that its failed Juul experiment, which cost it over $12 billion, brought on more skepticism.
At recent prices, AT&T is valued around 6 times trailing free cash flow, while Altria is just under 9, making the former more of a value, in my opinion. Add the fact that AT&T seems to have a clear plan, and I believe it has more long-term upside than Altria.
10 stocks we like better than AT&T
When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and AT&T wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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Stefon Walters has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-16
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Fool.com contributor Parkev Tatevosian reviews AT&T (NYSE: T) from the viewpoint of a passive income investor to determine whether it's an excellent dividend stock to buy.
*Stock prices used were the afternoon prices of Dec. 14, 2023. The video was published on Dec. 16, 2023.
Should you invest $1,000 in AT&T right now?
Before you buy stock in AT&T, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and AT&T wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than tripled the return of S&P 500 since 2002*.
See the 10 stocks
*Stock Advisor returns as of December 11, 2023
Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-16
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If you're worried about having enough passive income after you retire, there are plenty of options. Purchasing real estate to rent out is a popular option, but those rental properties will generate losses if you can't maintain them and find tenants who can pay their bills.
If you're interested in truly passive income, consider these dividend-paying stocks. They offer such high yields that just $11,930 spread among them is all it takes to set yourself up with $1,000 of annual dividend income in 2024.
Image source: Getty Images.
Buying these stocks looks like a great deal that could keep getting better. These businesses have a history of increasing their payouts, so you're likely to receive significantly more than $1,000 annually once you're ready to retire.
AT&T
Shares of AT&T (NYSE: T) offer investors a big 6.7% dividend yield at recent prices. At this level, $5,004 is enough to secure a little over $333 in annual dividend payments from the telecom giant.
Landline subscriptions are in steep decline, but America's need for telecommunications services has risen steadily. Data-hungry artificial intelligence (AI) applications and 5G-enabled mobile devices are driving growth for AT&T at a steady pace.
In the third quarter, mobility-service revenue rose 3.7% year over year, and operating income from the segment was better than it's ever been. The real growth driver for AT&T these days is consumer broadband. Revenue from this segment rose 9.8% year over year in Q3 driven by 296,000 new AT&T Fiber subscriptions.
Q3 2023 was the 15th in a row with more than 200,000 new AT&T Fiber subscribers, and its consumer-broadband sales will likely rise even further in 2024. AT&T Fiber is currently able to serve around 24 million consumer and business locations, and it's on pace to reach more than 30 million by the end of 2025. The company also launched a fixed wireless residential service that's already available in about 30 locations.
AT&T generated a whopping $19.8 billion in free cash flow over the past year and needed just 41% of this sum to meet its dividend commitment. That leaves plenty of room to raise the payout in line with earnings growth in the years ahead.
PennantPark Floating Rate Capital
Ever since the Great Recession, large American banks subject to stricter regulations have been hesitant to lend to middle-market businesses. As a result, companies that record between $10 million and $1 billion in annual revenue are generally starved for capital and willing to pay business development companies (BDC) like PennantPark Floating Rate Capital (NYSE: PFLT) above-average interest rates.
As its name implies, PennantPark Floating Rate Capital is a lender that almost always lends at variable interest rates. This can make it hard for borrowers to repay debts if rates rise too fast, but with careful underwriting, floating-rate debt can also lead to very reliable cash flows.
At recent prices, PennantPark Floating Rate Capital offers investors a huge 10.3% dividend yield, and it distributes payments every month. At recent prices, $3,250 is enough to set yourself up with $333 in annual dividend payments from this stock in 2024.
PennantPark Floating Rate Capital raised its dividend payout by 7.9% in 2023, and further raises could be in the works. At the end of September, just 3 borrowers in this BDC's portfolio of 131 companies were on non-accrual status. With the variable interest rates they pay likely to fall significantly in 2024, cash flows ought to be relatively predictable for at least the next several years.
Altria Group
Shares of Altria Group (NYSE: MO) offer a juicy 9.2% dividend yield, so all it takes to secure $333 in annual dividend income from the stock at recent prices is about $3,680. Combustible cigarette sales have been in decline for decades, but this company's ability to raise the price of the leading Marlboro brand in the U.S. should let it continue a very long track record of consecutive annual payout increases.
In Q3, Altria estimated an 8% year-over-year decline in domestic cigarette volume. Thanks to rising sales of non-combustible products, price increases on Marlboros, and share repurchases, adjusted earnings per share during the first nine months of 2023 rose 3.3% year over year.
This August, Altria Group raised its dividend payout for the 58th time in 54 years. The company generated $8.5 billion in free cash flow over the past year but needed just $6.7 billion to meet its dividend commitment.
With extra cash flows to pay down debts and acquire new sources of growth, such as NJOY, the only e-vapor manufacturer with market authorizations from the U.S. Food and Drug Administration (FDA) for a pod-based, e-vapor product, investors can reasonably expect this stock to keep up its 54-year streak for at least another decade.
Should you invest $1,000 in AT&T right now?
Before you buy stock in AT&T, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and AT&T wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
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Cory Renauer has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-16
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Fool.com contributor Parkev Tatevosian discusses a new arrangement between Rivian (NASDAQ: RIVN) and AT&T (NYSE: T) that has potential benefits for Rivian shareholders.
*Stock prices used were the afternoon prices of Dec. 14, 2023. The video was published on Dec. 16, 2023.
Should you invest $1,000 in Rivian Automotive right now?
Before you buy stock in Rivian Automotive, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Rivian Automotive wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than tripled the return of S&P 500 since 2002*.
See the 10 stocks
*Stock Advisor returns as of December 11, 2023
Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-16
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Electric vehicle maker Rivian Automotive RIVN has joined forces with telecom giant AT&T T. The deal with AT&T, set to be launched in early 2024, involves the integration of RIVN’s EVs into AT&T’s operational fleet. The collaboration is a testament to Rivian’s commitment to sustainability and innovation in the EV sector and also positions AT&T at the forefront of the eco-friendly corporate movement.
AT&T's plan to incorporate EVs into its fleet is a key component of its broader ambition to achieve carbon neutrality by 2035. The tie-up will see the telecom leader integrating Rivian's commercial vans and the much-anticipated R1 EVs into its operations.
The alliance between Rivian and AT&T extends beyond the mere purchase of EVs. In a strategic move, AT&T has been designated as the exclusive connectivity provider for all Rivian vehicles across the United States and Canada. This crucial role involves delivering over-the-air software updates, enhancing vehicle features and elevating the overall driving experience for Rivian's customers. This partnership reflects a deep integration of AT&T's connectivity solutions with Rivian's advanced vehicle technology.
The core of this deal lies in both companies' commitment to sustainability. Rivian, known for its innovative approach to EVs, is set to play a crucial role in reducing carbon emissions, especially given that commercial vans significantly contribute to CO2 emissions in the transportation sector. Hardmon Williams, senior vice president of AT&T's Connected Solutions, emphasized the importance of this pilot program in AT&T's journey toward a cleaner and more sustainable future.
After the conclusion of its exclusivity pact with Amazon AMZN, this deal with AT&T showcases Rivian’s appeal to a wide range of corporate clients.
Rivian remains committed to delivering 100,000 vans ordered by Amazon by 2030. The ongoing relationship with Amazon, coupled with the new deal with AT&T, underscores Rivian's growing influence in the EV market.Top of Form
Rivian currently carries a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Disclaimer: This article has been written with the assistance of Generative AI. However, the author has reviewed, revised, supplemented, and rewritten parts of this content to ensure its originality and the precision of the incorporated information.
Zacks Names "Single Best Pick to Double"
From thousands of stocks, 5 Zacks experts each have chosen their favorite to skyrocket +100% or more in months to come. From those 5, Director of Research Sheraz Mian hand-picks one to have the most explosive upside of all.
It’s a little-known chemical company that’s up 65% over last year, yet still dirt cheap. With unrelenting demand, soaring 2022 earnings estimates, and $1.5 billion for repurchasing shares, retail investors could jump in at any time.
This company could rival or surpass other recent Zacks’ Stocks Set to Double like Boston Beer Company which shot up +143.0% in little more than 9 months and NVIDIA which boomed +175.9% in one year.
Free: See Our Top Stock and 4 Runners Up >>
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
Amazon.com, Inc. (AMZN) : Free Stock Analysis Report
AT&T Inc. (T) : Free Stock Analysis Report
Rivian Automotive, Inc. (RIVN) : Free Stock Analysis Report
To read this article on Zacks.com click here.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-15
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
2023 has been mixed for growth stocks but I believe the worst is over. There is high optimism in the stock market as we end the year on a high note. However, if you want to secure your portfolio from such ups and downs and are looking for ways to generate passive income, considering top dividend stocks to buy is the best way forward.
But, all dividend stocks aren’t the same and some are more promising than many others. You need to look for companies that have shown steady growth, and resilience in the market and have a history of dividend payouts. Such companies will continue to reward shareholders, no matter how the market moves and you will be able to enjoy passive income while watching your investment grow. With that in mind, let’s take a look at the most undervalued dividend stocks to buy in December to enjoy a solid start to 2024.
PepsiCo (PEP)
Dividend Yield-3.01%
Source: 8ED8 / Shutterstock
When looking for stable companies to invest in, PepsiCo (NASDAQ:PEP) is the first one that comes to mind. One of the global leaders, the company has a diversified business which ensures steady income despite market turmoil. It is a dividend aristocrat which has raised dividends over the past 51 years.
Pepsi’s dividend yield is 3.01% and it paid a quarterly dividend of $1.27. Exchanging hands at $168 today, this is one stock that will continue giving. The company has a range of snacks and beverages that help maintain a steady cash flow and it enjoys brand loyalty like no other.
Irrespective of the country you are in, you will see a range of Pepsi products at the supermarket and this is proof of how well the company is expanding its reach. Even in times of high inflation, Pepsi saw steady revenue growth. This is a solid dividend stock to own this month.
Dividend stocks to buy: McDonald’s (MCD)
Dividend yield-2.30%
Source: Gargantiopa / Shutterstock
McDonald’s (NYSE:MCD) is another undervalued dividend stock that should be a part of your portfolio. The company has nailed the franchise business, and it enjoys high cash flow through the steady income and low operating costs. It aims to expand to 50,000 stores by 2027 and this could give the business a solid push. Trading at $290 today, MCD stock might look expensive but it is worth an investment.
The company has been paying dividends for over 40 years, and it enjoys a dividend yield of 2.30%. In the recent quarter, the company saw a 14% increase in revenue to hit $6.69 billion, and the EPS came in at $3.17 per share, up 18% year-over-year.
The management increased the quarterly dividend by 10% to $1.67 per share. McDonald’s has big expansion plans, and it continues to see revenue growth. This makes it a worthwhile investment.
Enterprise Products Partners (EPD)
Dividend yield- 7.55%
Source: Casimiro PT / Shutterstock.com
With a dividend yield as high as 7.55%, Enterprise Products Partners (NYSE:EPD) is one of the top dividend stocks to buy this December. It owns a diverse portfolio of assets which include natural gas pipelines, liquid pipelines, marine terminals, and NGL fractionators. It is steadily working towards growth and expansion and aims to build two plants in the Permian Basin which will have the processing ability to handle 300 million cubic feet per day.
Enterprise Products Partners charges a fee from companies to use its assets and this is how it maintains a steady revenue growth. The company has a solid balance sheet and low debt which helps it reward shareholders. EPD is one of the top dividend stocks to buy.
The management believes in rewarding shareholders and has paid consecutive dividends for the past 25 years. It has a dividend yield of 7.55% and pays a quarterly dividend of $0.50. For a stock trading at $26, the dividend yield is certainly impressive. You will not regret owning EPD stock for a long time.
AT&T (T)
Dividend yield- 6.67%
Source: Jonathan Weiss/Shutterstock
AT&T (NYSE:T) is far from done, and while the stock may be down, it isn’t out. One of the top passive income stocks, AT&T is in the news for the recent contract with Ericsson (NASDAQ:ERIC). This $14 million deal will be a game changer for the business and it has already given a boost to the stock.
Through this collaboration, AT&T aims to cover about 70% of its wireless traffic in the U.S. It aims to expand the 5G network, and this will help it reach more than 200 million people by the end of the year. The management stated that they are in line to generate $16.5 billion in free cash flow in the year.
Additionally, it is also growing its wireless subscriber base and has added more than 468,000 net phone subscribers in the third quarter. T stock is trading for $16.65 today and is up 5% over the past month. It enjoys a dividend yield of 6.67% and has announced a quarterly dividend of $0.28.
Dividend stocks to buy: Johnson & Johnson (JNJ)
Dividend yield- 3.03%
Source: Raihana Asral / Shutterstock.com
A leader in the healthcare sector, Johnson & Johnson (NYSE:JNJ) is a dividend aristocrat with a history of paying dividends for 51 consecutive years. The company has managed to sustain the dividends through its MedTech and innovative medicine portfolio which has a few stalwarts that continue to generate revenue.
Its MedTech segment reported $7.5 billion in sales, which was a 10% rise, and the innovative medicine segment reported a revenue of $13.9 billion, a 5.1% rise. The company is launching several new products that have shown early signs of success and could become strong income generators in the long term.
JNJ could bring stability to your portfolio and is a highly reliable name in the industry with a dividend yield of 3.03% and a quarterly dividend of $1.19. The management has rewarded shareholders, no matter the market situation and I strongly believe it will continue to do so. It is one of the top stocks in the healthcare sector to own.
Coca Cola (KO)
Dividend yield-3.12%
Source: Soloviov Vadym / Shutterstock.com
Pepsi’s biggest rival, Coca-Cola (NYSE:KO) is another household name that believes in rewarding shareholders. The beverage giant has a global presence, and is known for a wide range of beverages including several healthy drinks. It is exchanging hands at $59 and has a dividend yield of 3.12%. Coca-Cola announced a quarterly dividend of $0.46 and has paid handsome dividends for the past 60 years.
Fundamentally, it has managed to achieve 11% organic revenue growth in the third quarter, and it has achieved success and market share across new markets like Japan, ASEAN, South Pacific, and Latin America. Like Pepsi, it enjoys brand loyalty and global recognition.
It is also Warren Buffet’s favorite stock, and he has owned it the longest. Today, he holds 400 million KO shares which could generate billions in dividends annually. Coca-Cola can thrive, irrespective of where the market moves from now, and trading below $60, it looks highly undervalued today.
Procter & Gamble (PG)
Dividend yield- 2.60%
Source: Jonathan Weiss / Shutterstock.com
A globally recognized household name, Procter & Gamble (NYSE:PG) is a defensive stock. It owns some of the biggest consumer brands today and is recognized for a wide range of products that cater to individuals of all age groups.
We will never see a time when we do not need personal care items which means PG is never going to run out of business. The company has established a strong position in the industry and enjoys high brand loyalty. Due to the wide umbrella of brands, it enjoys steady revenue growth and predictable cash flow.
PG is trading at $144 today and has dropped 4% year-to-date. The stock is trading lower than the all-time high of $163 but has a long way to go. It has a dividend yield of 2.60% and announced a quarterly dividend of $0.94. As the economy improves and we see higher consumer spending, Procter & Gamble could see better days ahead.
On the date of publication, Vandita Jadeja did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Vandita Jadeja is a CPA and a freelance financial copywriter who loves to read and write about stocks. She believes in buying and holding for long term gains. Her knowledge of words and numbers helps her write clear stock analysis.
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The post The 7 Most Undervalued Dividend Stocks to Buy in December appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-14
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(RTTNews) - Rivian Automotive, Inc. (RIVN) Thursday announced that they have signed an agreement to sell Rivian electric vehicles to telecom major AT&T (T).
The financial details of the deal are not yet known.
Through a pilot program aimed at cutting transport emissions, AT&T will add Rivian Commercial Van and R1 vehicles to its fleet in early 2024 and begin evaluating the various ways these vehicles help improve safety, reduce costs, and cut its carbon footprint.
Rivian is hoping that this deal will help AT&T reach its commitment of carbon neutrality by 2035.
The Rivian Commercial Van is engineered to be one of the safest vehicles on the road having features like automatic emergency braking, collision warnings, and 360-degree visibility, as per the company.
Additionally, AT&T is the exclusive provider of connectivity to all Rivian vehicles, in the U.S. and Canada. The electric vehicle company uses AT&T connectivity for its over-the-air software updates.
In pre-market activity, Rivian shares are trading at $20.24, up 2.85% on the Nasdaq and AT&T shares are trading at $16.53 up 0.52% on the New York Stock Exchange.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-14
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When dividend stocks crash in value, that sends their yields up in the opposite direction. But there can be danger for investors who load up on a stock just because its yield is high.
Before buying shares of a high-yielding company, investors should take a quick look to see why the stock is underperforming, and why the yield is so high. That can avoid a lot of headaches and regrets later on.
Three dividend stocks that look cheap right now are Pfizer (NYSE: PFE), Enbridge (NYSE: ENB), and AT&T (NYSE: T). They have all been struggling this year, and their yields are now well above 5%. Let's look at why these payouts are so high and whether you should consider investing in any of these stocks today.
1. Pfizer: 5.7% yield
It's not typical for a top healthcare company to lose more than 40% of its value in a single year. But that's exactly the situation Pfizer is in right now. Investors are concerned about a decline in revenue from its COVID vaccine and product; plus, issues relating to its long-term growth are exacerbating worries about the business. The stock is down more than 43% year to date.
Due to the sharp sell-off, Pfizer's yield is now an incredibly high 5.7%. Since its dividend has remained the same ($0.41 per quarter), investors are now collecting the same dividend at a lower price, resulting in a higher yield.
There is good reason for the concern as Pfizer incurred a third-quarter loss of just under $2.4 billion, for the period ended Oct. 1. A big 42% drop in revenue wasn't accompanied with a big decline in expenses, leading to a disastrous performance for the company.
But the company is planning to shed $3.5 billion in costs from its books as it adapts to low demand for COVID products, which should lead to better results. There's some risk with Pfizer's business today, but investors shouldn't push the panic button just yet. The company is in the midst of a transition as it loads up on acquisitions and lessens its exposure to COVID products.
Although its payout ratio is around 90%, which isn't great, I would expect that to get better as the company trims costs and reduces the size of its COVID business. Pfizer would need to endure more difficult quarters and prove this is a troubling pattern before I would start to worry about the safety of the dividend.
For long-term investors, Pfizer can make for an attractive contrarian buy as it trades at just nine times its estimated future earnings.
2. Enbridge: 7.7% yield
Over the years, Enbridge has normally offered a high dividend yield. This year, it has gone even higher to 7.7%. Shares of the Canadian pipeline and energy company have declined 11% year to date as investors have grown less optimistic about the oil and gas industry. And since it's a top pipeline company, it has struggled right along with similar stocks.
But not only is the company not worried, it also recently increased its dividend. In November, Enbridge announced it would be raising its payout by 3%. This means that it has now raised its dividend for 29 consecutive years.
Enbridge benefits from locking in long-term contracts, which provide it with good stability. The company projects that its distributable cash flow, a key metric when it comes to evaluating a dividend's safety within the industry, will grow by 3% next year.
Earlier this year, Enbridge caught investors and analysts off-guard with plans to acquire three companies from Dominion Energy for $14 billion. Enbridge called the move a "once in a generation" opportunity to expand its operations in the U.S.
Analysts, however, grew concerned about rising debt levels. But Enbridge says that just 10% of its debt portfolio is vulnerable to possible changes in interest rates. And by 2025, in the first full year that it owns the new assets, they will already be accretive to its per-share metrics.
Overall, Enbridge isn't in bad shape, and it could look even better due to the acquisition of these businesses. The stock's incredibly high yield might not be too good to be true. Income investors may want to buy shares sooner rather than later as they are trading within just a few dollars of their 52-week lows.
3. AT&T: 6.6% yield
There has been no shortage of naysayers surrounding AT&T's dividend. The business has a high debt load, and concerns about it having to potentially spend billions to clean up lead-covered cables resulted in a steep decline for the stock.
While investors shouldn't ignore concerns about a large cleanup cost, that's a situation that could play out over the course of years. Any payout, assuming one is necessary, would likely span years as well. The end result is that it's too early to know how big of a problem it may be, but even if it is big, AT&T likely won't need to make a big outflow of cash all at once to address the issue.
In recent months, fears have begun to subside, and the stock has been rallying. Year to date, AT&T stock is now down just 8%. While that isn't great, it's better than earlier when it was looking like it may be on track to finish the year down around 30%.
Things looked a whole lot better in October, when the company posted its most recent quarterly results. While revenue of $30.4 billion for the period ended Sept. 30 grew at only 1%, the big takeaway for investors was that not only was AT&T still on track to hit its goal of $16 billion in free cash flow for the year, but it was also raising that target to $16.5 billion.
Given its strong results, AT&T isn't a stock whose yield looks to be in trouble. And with the stock rallying in recent months, investors may want to buy the shares before they rise even more and the yield shrinks. At just seven times its estimated future earnings, the stock looks like a steal of a deal.
Should you invest $1,000 in Pfizer right now?
Before you buy stock in Pfizer, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Pfizer wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than tripled the return of S&P 500 since 2002*.
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*Stock Advisor returns as of December 11, 2023
David Jagielski has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Enbridge and Pfizer. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-14
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By Abhirup Roy
SAN FRANCISCO, Dec 14 (Reuters) - U.S. wireless carrier AT&T T.N will purchase some electric vehicles from startup Rivian RIVN.O in a pilot program to evaluate ways to reduce cost, cut carbon emissions and improve safety, the companies said on Thursday.
The deal is the first for Rivian after the company last month ended its exclusivity pact with largest shareholder Amazon AMZN.O for its delivery vans, opening the door for more customers.
AT&T expects to start adding Rivian electric commercial vans, R1T pickup trucks, and R1S sport utility vehicles in its fleet in early 2024, they said in a statement.
The companies did not disclose the number of vehicles AT&T will buy or the financial terms of the deal.
AT&T has long been investing in converting its commercial fleet to vehicles that use alternative fuels such as compressed natural gas and hybrid electric vehicles.
"This pilot is another important step in our ongoing efforts toward sustainability, reducing our carbon footprint and embracing a cleaner future for our operations," Hardmon Williams, senior vice president of AT&T Connected Solutions said.
Environmental, social and corporate governance (ESG) goals and emission reduction targets for companies have sparked a race to shift to zero-emission fleets.
But high interest rates have made it costlier for customers to purchase electric vehicles, which that are typically more expensive than their gas-powered counterparts, and raised worries of a slowdown in demand.
Still, Rivian has said it has seen a "lot of interest and demand" for its vans beyond Amazon. On Thursday, the company declined to disclose other potential customers.
It has also reiterated its commitment to fulfilling an order for 100,000 vans to Amazon by 2030. Amazon said in October it has 10,000 of those vehicles across the U.S. and Europe.
Last month, Irvine, California-based Rivian raised its overall 2023 production forecast to 54,000 units.
(Reporting by Abhirup Roy in San Francisco; Editing by Christian Schmollinger)
((abhirup.roy@thomsonreuters.com; +1 415 941 8665; @abhiruproy30;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-14
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In this series, we look through the most recent Dividend Channel ''DividendRank'' report, and then we cherry pick only those companies that have experienced insider buying within the past six months. The officers and directors of a company tend to have a unique insider's view of the business, and presumably the only reason an insider would choose to take their hard-earned cash and use it to buy stock in the open market, is that they expect to make money — maybe they find the stock very undervalued, or maybe they see exciting progress within the company, or maybe both. So when stocks turn up that see insider buying, and are also top ranked, investors are wise to take notice. One such company is AT&T Inc (Symbol: T), which saw buying by Director Stephen J. Luczo.
Back on November 13, Luczo invested $971,875.00 into 62,500 shares of T, for a cost per share of $15.55. In trading on Thursday, shares were changing hands as low as $16.51 per share, which is 6.2% above Luczo's purchase price. AT&T Inc shares are currently trading +1.20% on the day. The chart below shows the one year performance of T shares, versus its 200 day moving average:
Looking at the chart above, T's low point in its 52 week range is $13.43 per share, with $20.50 as the 52 week high point — that compares with a last trade of $16.66. By comparison, below is a table showing the prices at which insider buying was recorded over the last six months:
PURCHASED INSIDER TITLE SHARES PRICE/SHARE VALUE
11/13/2023 Stephen J. Luczo Director 62,500 $15.55 $971,875.00
The DividendRank report noted that among the coverage universe, T shares displayed both attractive valuation metrics and strong profitability metrics. For example, the recent T share price of $16.45 represents a price-to-book ratio of 1.1 and an annual dividend yield of 6.75% — by comparison, the average company in Dividend Channel's coverage universe yields 4.5% and trades at a price-to-book ratio of 2.1. The report also cited the strong quarterly dividend history at AT&T Inc, and favorable long-term multi-year growth rates in key fundamental data points.
The report stated, ''Dividend investors approaching investing from a value standpoint are generally most interested in researching the strongest most profitable companies, that also happen to be trading at an attractive valuation. That's what we aim to find using our proprietary DividendRank formula, which ranks the coverage universe based upon our various criteria for both profitability and valuation, to generate a list of the top most 'interesting' stocks, meant for investors as a source of ideas that merit further research.''
The annualized dividend paid by AT&T Inc is $1.11/share, currently paid in quarterly installments, and its most recent dividend ex-date was on 01/09/2024. Below is a long-term dividend history chart for T, which the report stressed as being of key importance. Indeed, studying a company's past dividend history can be of good help in judging whether the most recent dividend is likely to continue.
The Top DividendRank'ed Stocks With Insider Buying »
Also see:
Cheap Consumer Stocks
PMVP Insider Buying
Top Ten Hedge Funds Holding RWT
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-14
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Many aggressive growth stocks are rising Thursday as Treasury yields drop and investors anticipate Federal Reserve rate cuts ahead. But shares of electric vehicle maker Rivian Automotive (NASDAQ: RIVN) are rising for another reason, too.
Rivian shares spiked as much as 10.6% Thursday morning, settling to a gain of 7% as of 10:45 a.m. ET.
New fleet customer
The news helping to boost the stock was the announcement of a new pilot deal with media giant AT&T for Rivian's electric commercial vans and trucks. AT&T will begin adding the Rivian van and R1 platform trucks to its fleet early next year. The program is meant to enable AT&T to "begin evaluating the various ways these vehicles help improve safety, reduce costs and cut its carbon footprint."
The deal is especially significant for Rivian because it marks the first new customer for its commercial vans beyond Amazon. Rivian has been delivering vans to Amazon for an exclusive 100,000-vehicle order.
But Rivian announced the exclusivity component was ending when it reported third-quarter earnings in early November. Today's announcement marks the first new customer deal for the electric vans.
Tailwinds ahead
Rivian shares have surged about 30% over the last month since that third-quarter report. Investors became more optimistic about the stock's potential after Rivian boosted its 2023 production guidance and due to a lower interest rate environment.
Treasury yields have dropped as the Fed signals the end to the interest rate hike cycle. Many now expect rate cuts in 2024. That's good news for aggressive growth stocks like Rivian that will likely continue to need more capital to grow.
Today's news is yet another tailwind for Rivian. It will begin construction on a new manufacturing plant early next year. The pilot program with AT&T for Rivian commercial vans could be a sign that demand beyond Amazon for its commercial offerings will help fill that plant. That's why aggressive investors might want to own some Rivian stock now.
Should you invest $1,000 in Rivian Automotive right now?
Before you buy stock in Rivian Automotive, consider this:
The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now... and Rivian Automotive wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years.
Stock Advisor provides investors with an easy-to-follow blueprint for success, including guidance on building a portfolio, regular updates from analysts, and two new stock picks each month. The Stock Advisor service has more than tripled the return of S&P 500 since 2002*.
See the 10 stocks
*Stock Advisor returns as of December 11, 2023
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Howard Smith has positions in AT&T, Amazon, and Rivian Automotive. The Motley Fool has positions in and recommends Amazon. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-14
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Below is Validea's guru fundamental report for AT&T INC. (T). Of the 22 guru strategies we follow, T rates highest using our Shareholder Yield Investor model based on the published strategy of Meb Faber. This strategy looks for companies returning cash to shareholders via dividends, buybacks and debt paydown.
AT&T INC. (T) is a large-cap growth stock in the Communications Services industry. The rating using this strategy is 95% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
UNIVERSE: PASS
NET PAYOUT YIELD: PASS
QUALITY AND DEBT: PASS
VALUATION: PASS
RELATIVE STRENGTH: PASS
SHAREHOLDER YIELD: PASS
Detailed Analysis of AT&T INC.
T Guru Analysis
T Fundamental Analysis
More Information on Meb Faber
Meb Faber Portfolio
About Meb Faber: Meb Faber is the founder of Cambria Investments. His research has covered a wide spectrum of the investment world, including topics like shareholder yield, trend following, global asset allocation and home country bias. His shareholder yield strategy, which is based on his book "Shareholder Yield" and forms the basis for an ETF of the same name, looks for companies that are focused on creating value for shareholders by returning cash to them in the form of dividends, share buybacks and debt paydown. Meb is also the author of 4 other books and numerous white papers on investing related topics.
Additional Research Links
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-13
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
The quest for the passive income from a stable investment avenues beckons toward dividend stocks. Enter a realm where industry giants don their strategic armor, ready to navigate the tides of market dynamics and consumer demands.
The stage is set for an enthralling exploration of seven passive income juggernauts. Each is an emblem of innovation and resilience in their respective domains.
These passive income plays offer investors a panoramic view of the dividend stock landscape in the ever-evolving market of 2024.
Pfizer (PFE)
Source: photobyphm / Shutterstock.com
Pfizer (NYSE:PFE) is a passive income stock that has vast market potential and unmet medical needs that the company aims to address.
For instance, an estimated 80 million adults are eligible for RSV vaccination in the US alone, which shows a significant market size for ABRYSVO. The additional market potential of maternal immunization further enhances its revenue prospects by protecting both older adults and infants with one vaccine, indicating a competitive advantage.
Similarly, the oral calcitonin gene-related peptides in the migraine market suggest a high unmet need, with potential market dominance projected to reach up to 40%.
The substantial difference between Triptans and oral CGRP prescriptions signifies a considerable opportunity for growth in the migraine treatment market. It highlights Pfizer’s potential to capture a larger market share.
In the case of sickle cell disease, Pfizer addresses a significant burden of illness affecting an estimated 12 million people globally. This represents Pfizer’s focus on addressing substantial market opportunities and unmet medical needs across various demographics and therapeutic areas. Therefore, this edge positions the company for continued growth and market leadership.
AT&T (T)
Source: Lester Balajadia / Shutterstock.com
AT&T (NYSE:T) is an old-school passive income stock. Its deliberate investment in 5G technology has been a cornerstone of its growth strategy.
The company’s focus on expanding its 5G network infrastructure is a significant indicator of its forward-looking approach and market adaptability.
Notably, AT&T aims to reach over 200 million people with mid-band 5G spectrum by the end of 2023. The goal represents the company’s proactive stance in providing next-generation connectivity to a broad consumer base. AT&T’s aggressive 5G rollout puts them in a competitive position to capture a significant market share.
Finally, the investment in 5G technology isn’t merely about expanding coverage but also about addressing the increasing data demands of consumers. By providing best-in-class 5G solutions, AT&T caters to existing customer needs and stays ahead of the curve in meeting future data consumption patterns.
Johnson & Johnson (JNJ)
Source: Alexander Tolstykh / Shutterstock.com
Johnson & Johnson’s (NYSE:JNJ) passive income strength lies in its diversified portfolio, spanning the innovative medicine and MedTech segments.
For instance, in Q3 2023, within the innovative medicine segment, sales totaled $13.9 billion, reflecting a 5.1% increase driven by key brands.
These products exhibited commendable growth rates ranging from 15.8% to 27%. Hence, these leads emphasize the company’s capacity to innovate and capitalize on market demand for specific therapeutic categories.
Similarly, the MedTech segment reported sales of $7.5 billion, marking a robust 10% increase. Advancements across platforms such as electrophysiology, vision, and orthopedics propelled this growth. The segment’s diversification across medical devices and technological advancements represents Johnson & Johnson’s focus on consistent value growth.
The increase in topline was multifaceted, supported by solid growth rates within specific geographic markets. Lastly, the US market experienced a substantial 11.1% increase in sales, driving a significant portion of the company’s overall growth.
Procter & Gamble (PG)
Source: Jonathan Weiss / Shutterstock.com
Considering the size of its top line, Procter & Gamble’s (NYSE:PG) attainment of a 7% increase in organic sales during Q1 fiscal 2024 signifies a robust performance from this passive income stock.
This growth indicates the company’s strong market positioning and consumer demand for its products. It also represents effective strategies in pricing, product mix, and volume management.
Fundamentally, P&G’s progress in driving growth across all 10 product categories signifies its diversified offerings’ resilience and market acceptance. Certain segments, including home care, personal healthcare, and others, exhibited robust growth rates ranging from double digits to mid-singles.
Despite challenges faced in Greater China, P&G showcased significant organic sales growth in five out of seven regions. The US market grew by 7%, while Europe’s focus markets recorded a substantial 15% growth rate. Therefore, this expansion highlights the effectiveness of its localized strategies that may support its financial performance over the long term.
Verizon (VZ)
Source: Ken Wolter / Shutterstock.com
Verizon (NYSE:VZ) has consistent growth in broadband subscribers, with over 400K new subscribers for four consecutive quarters (as of Q3 2023). This growth signifies its fundamental leads in the broadband market. Also, this growth is driven by the company’s focus on providing quality service, including the popular Fixed Wireless Access (FWA) offering.
A substantial 72K Internet net increase adds to the Fios segment. It indicates Verizon’s competitive strength and the continued appeal of its services. Similarly, Verizon has made progress in achieving sequential and year-over-year improvements in postpaid phone net adds. This progress showcases its effectiveness in customer acquisition without resorting to aggressive promotional tactics. The company’s focus on providing customers with personalized experiences exemplifies offerings like myPlan. Thus, these offerings increase customer additions and enhance average revenue per account (ARPA).
Finally, Verizon Business Group has consistently grown, adding 151K phone net in Q3. These increase the company’s reliability in delivering connectivity solutions to various customer segments. Fundamentally, the company’s appeal to businesses, governments, and enterprises signals its market strength.
3M (MMM)
Source: JPstock / Shutterstock.com
3M’s (NYSE:MMM) performance across its diverse business segments provides its strategic strengths.
For instance, in Q3 2023, Safety and Industrial’s operating margins of 25.7% and adjusted sales of $2.8 billion, despite experiencing organic declines, represent effective cost management.
Transportation and Electronics, with operating margins of 26.3% and sales of $1.9 billion, displayed robust margin expansion despite challenges in the electronics market.
Overall, the ability to sustain margins amid market fluctuations indicates 3 M’s agility in implementing strategies to offset challenges, capitalize on strengths, and maintain profitability across its diverse portfolio of businesses.
Lowe’s (LOW)
Source: Helen89 / Shutterstock.com
Lowe’s (NYSE:LOW) holds a dominant position as the market leader in appliances within the US, accounting for 14% of its sales. The third quarter of 2023 highlights that the industry-wide pullback in appliance sales affects Lowe’s significantly because of its substantial market share in this category.
This market leadership gives Lowe’s a unique advantage and represents a fundamental strength that could support rapid growth potential. Despite declining appliance sales, Lowe’s might leverage its position and implement strategies to capture more market share or stimulate demand.
The proportion of revenue derived from DIY customers (75%) and professionals (25%) is crucial. When the DIY segment becomes cautious, it disproportionately affects Lowe’s. Conversely, despite the DIY decline, Lowe’s maintained positive sales comps in the Pro segment.
Thus, this diversified customer base cushions during fluctuations in consumer behavior, thereby mitigating risks associated with specific market shifts.
As of this writing, Yiannis Zourmpanos held long positions in PFE, T, VZ, and MMM. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Yiannis Zourmpanos is the founder of Yiazou Capital Research, a stock-market research platform designed to elevate the due diligence process through in-depth business analysis.
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The post Seeking Passive Income? 7 Dividend Stocks You Don’t Want to Miss. appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-13
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Telecommunications giant AT&T (NYSE: T) is a household name and a well-known dividend stock. Had you invested $100 in AT&T in 1995, your investment would have grown to $476 today. Is that good? Well, it definitely needs context. Many investors buy AT&T for its huge dividend, which yields an impressive 6.5% at its current share price.
But a lot more goes into investment results than just a dividend. So let's take a closer look at AT&T and use its past to help determine whether it's worth holding for the future.
The difference a dividend makes (or doesn't)
Are you a glass-half-full or glass-half-empty type of character? AT&T has multiplied an initial $100 investment to nearly $500 over the years. However, that incorporates total returns, share price gains and losses, and dividends paid. Take the dividends away, and you would have lost money!
The dividend optimist might argue that dividends were the difference between losing and multiplying their money. That's true, but even the total returns have dramatically trailed those of the S&P 500 index, which would have turned the same $100 into more than $1,200.
T data by YCharts
The bottom line? Yes, dividends can significantly boost your total returns over the long term, especially when you reinvest them to turbocharge your compounding snowball. But there is far more to a stock than its dividend. The dividend alone doesn't make an investment great.
Where AT&T falls short
It's time to change your gaze and focus on AT&T's broader business performance. A great company generates value for its shareholders over time. That's the most basic definition of a great investment.
So how has AT&T done since 1995? A company's return on invested capital (ROIC) measures the return it generates when it invests in the business. A high return means it can put resources in and get a lot out. AT&T's business is currently generating a negative ROIC, meaning it's destroying value when it invests.
T Return on Invested Capital data by YCharts
Meanwhile, AT&T's earnings per share have gone up and down but are lower today than nearly three decades ago! The same can't be said for its debt, which has exploded higher over the years and stands at $138 billion today.
You can see the slopes of each line above, but here are some percentages. AT&T's ROIC has fallen over 200%, turning negative. Earnings are 20% lower today than in 1995. Lastly, debt has increased by a staggering 1,750%.
AT&T is far worse off than it once was fundamentally, which has much to do with the stock's poor performance.
A turnaround on the way?
The company's debt load peaked after it tried and failed to enter the entertainment media industry with massive acquisitions of DirectTV and Time Warner, worth tens of billions of dollars. AT&T has since spun off those assets and used the proceeds to pay down debt.
That's the first step to a long-term turnaround because all that interest expense, which is $6.5 billion over the past year, takes away from AT&T's bottom line. Cash flow is pretty strong, with about $12 billion left after paying the dividend. The balance sheet should heal, but it could take at least a few years.
AT&T must still grow; analysts see just 3% annual earnings growth over the next three to five years. Management must also still show it can responsibly invest AT&T's money. Ideally, a great stock can pay dividends and still perform well enough to create long-term value and grow. AT&T hasn't yet shown enough to forgive it for three decades of mediocrity.
Should you invest $1,000 in AT&T right now?
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Justin Pope has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-13
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The high interest rate environment over the past year and a half has been challenging for growth stocks - at least, for those that haven't been swept up in the epic artificial intelligence (AI)-fueled rally powering some of the tech sector standouts.
While the Fed's policy-tightening campaign to combat rising inflation has been a headwind for some rate-sensitive stocks, indications out of this week's meeting seem to confirm that the table is set for a full-on pivot to rate cuts in 2024 - which means the path of least resistance may be higher for growth names in the year ahead.
Against this backdrop, here's a look at three high-quality growth stocks for investors looking to gain exposure to this space.
Live Nation Entertainment
Founded in 1995, Live Nation (LYV) is a multinational entertainment company that promotes, operates, and manages ticket sales for live entertainment events globally. The California-based company is best known for producing live music concerts, selling tickets (through its subsidiary Ticketmaster, which is one of the world's leading live entertainment ticketing sales and marketing companies), and owning and operating venues. Its market cap currently stands at $20.74 billion.
Live Nation stock is up 25% on a YTD basis, edging out the roughly 21% gain in the S&P 500 Index ($SPX) over this time frame.
www.barchart.com
Live Nation's latest numbers for Q3 2023 were strong, as both revenue and earnings beat Wall Street's estimates. Revenues increased by 32% from the previous year to $8.15 billion, boosted primarily by 32% yearly growth in revenues from concerts to roughly $7 billion. Meanwhile, EPS rose 28% to $1.78, topping analysts' expectations of $1.27. In fact, the company's EPS has exceeded expectations in four out of the past five quarters.
Although LYV's net long-term debt rose to about $6.5 billion from $5.4 billion at the beginning of the year, the company has a solid cash balance of $6 billion.
Notably, Live Nation's dominance in the global live shows arena has helped boost its revenue results, even as it has drawn regulatory scrutiny - particularly for its Ticketmaster division.
Analysts don't appear to be pricing in any major regulatory hurdles, though, as Live Nation's key growth metrics are well above the sector median. With forward revenue growth and long-term EPS (3-5 years CAGR) at 54.76% and 38.50%, respectively, the entertainment giant is projected for above-average growth in the years ahead.
Overall, analysts have deemed the stock a “Strong Buy” with a mean target price of $110.78. This denotes an upside potential of about 26% from current levels. Out of 14 analysts covering the stock, 12 have a “Strong Buy” rating and 2 have a “Hold” rating.
www.barchart.com
T-Mobile US
Founded in 1994, the current iteration of T-Mobile US (TMUS) was formed by a merger with MetroPCS Communications. T-Mobile has since emerged as the third-largest wireless carrier in the U.S., with over 117 million subscribers. It provides mobile phone, Internet, and television services to its consumers, and it's a leader in the 5G space, with its network reaching 98% of all Americans.
T-Mobile's median download and upload speeds for Q3 were significantly faster than those of legacy carriers AT&T (T) and Verizon (VZ), according to Ookla test results.
The company currently commands a market cap of $185.54 billion, and recently announced its first-ever dividend in September.
Shares of T-Mobile US are up 14.7% YTD to underperform the broader market, although the stock is outperforming both AT&T and Verizon by a wide margin.
www.barchart.com
TMUS reported a mixed third quarter, as revenues fell short of estimates while EPS beat expectations. Revenues dipped 1.2% from the previous year to $19.25 billion, while EPS jumped to $1.82 from $0.40 in the previous year - comfortably outpacing the consensus estimate of $1.70, and continuing a string of bottom-line beats for TMUS.
Notably, to continue this strong run-rate of revenue growth, T-Mobile is aiming to gain a foothold in the rural American market. The company is working with a goal to reach a 20% share of these households by the end of 2025.
Further, the company also raised the low end of its free cash flow guidance range for FY 2023. TMUS now expects free cash flow of $13.4 billion to $13.6 billion for the full fiscal year, up from $13.2 billion to $13.6 billion previously.
Impressively, over the past 10 years, T-Mobile's revenue and EPS have clocked a CAGR of 13.29% and 55.80%, respectively. Moreover, the company's forward EPS growth is projected at 60.6%, much higher than the sector median of 3.84%.
Analysts have an average “Strong Buy” rating on TMUS, with a mean target price of $180.53 - indicating expected upside potential of about 12.6% from current levels. Out of 17 analysts covering the stock, 13 have a “Strong Buy” rating, 3 have a “Moderate Buy,” and 1 has a “Hold” rating.
www.barchart.com
Booking Holdings
We round out our list with Booking Holdings (BKNG), a global online travel company that operates a variety of popular brands like Booking.com, Priceline, Agoda, OpenTable, and KAYAK, among others. Founded in 1996, these brands offer a plethora of travel products and services to consumers and businesses around the world.
Notably, Booking.com is the world's leading brand for booking online accommodation reservations, based on room nights booked, occupying the number one position in the travel space. Booking dominates in the European market, and it's second only to Expedia (EXPE) in the U.S. market.
Commanding a market cap of $118.71 billion, Booking stock has rallied 69.5% on a YTD basis.
www.barchart.com
Booking reported solid Q3 earnings that beat on both the top and bottom line. Revenues were up 21% from the previous year to $7.3 billion, as gross travel bookings rose 24% to $39.8 billion. Quarterly EPS of $72.32 improved 36.4% from the prior year, and came in above the consensus estimate of $67.86. In fact, the company's EPS has topped expectations in each of the past five quarters.
The company maintains a substantial cash balance of $13.3 billion, higher than its long-term debt levels of $11.9 billion.
Booking has demonstrated consistent revenue and EPS growth over the long haul, clocking a 10-year CAGR of 12.34% and 15.13%, respectively. And looking ahead, forward revenue and EPS growth of 29.06% and 81.30% are projected to be well above their respective sector medians.
A key aspect of future growth at BKNG could stem from its AI Trip Planner, which it launched in June of this year. The aim of the planner is to let customers avoid the hassle of booking flights and hotels, making it as automatic as possible.
Overall, analysts have a “Moderate Buy” rating for BKNG with a mean target price of $3,451.45. This indicates an upside potential of roughly 8% from current levels. Out of 24 analysts covering the stock, 16 have a “Strong Buy” rating, 1 has a “Moderate Buy” rating, 6 have a “Hold” rating, and 1 has a “Strong Sell” rating.
www.barchart.com
On the date of publication, Pathikrit Bose did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-13
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The NASDAQ 100 After Hours Indicator is down -23.78 to 16,538.59. The total After hours volume is currently 119,937,281 shares traded.
The following are the most active stocks for the after hours session:
Rivian Automotive, Inc. (RIVN) is -0.0611 at $19.62, with 7,754,282 shares traded. As reported by Zacks, the current mean recommendation for RIVN is in the "buy range".
AT&T Inc. (T) is -0.03 at $16.42, with 5,008,281 shares traded. T's current last sale is 82.1% of the target price of $20.
iShares 20+ Year Treasury Bond ETF (TLT) is -0.06 at $96.78, with 4,871,418 shares traded. This represents a 17.42% increase from its 52 Week Low.
Philip Morris International Inc (PM) is unchanged at $94.40, with 3,812,466 shares traded. As reported by Zacks, the current mean recommendation for PM is in the "buy range".
Chimera Investment Corporation (CIM) is unchanged at $5.11, with 3,547,970 shares traded. CIM's current last sale is 92.91% of the target price of $5.5.
Nerdy Inc. (NRDY) is unchanged at $2.96, with 2,872,061 shares traded. As reported by Zacks, the current mean recommendation for NRDY is in the "buy range".
Ford Motor Company (F) is -0.03 at $11.21, with 2,705,413 shares traded. F's current last sale is 80.07% of the target price of $14.
Amazon.com, Inc. (AMZN) is unchanged at $148.84, with 2,678,604 shares traded. As reported by Zacks, the current mean recommendation for AMZN is in the "buy range".
Altria Group (MO) is -0.0497 at $41.97, with 2,565,977 shares traded. MO's current last sale is 91.24% of the target price of $46.
Apple Inc. (AAPL) is -0.035 at $197.93, with 2,558,603 shares traded. As reported by Zacks, the current mean recommendation for AAPL is in the "buy range".
Mirati Therapeutics, Inc. (MRTX) is unchanged at $57.37, with 2,497,888 shares traded. MRTX's current last sale is 98.07% of the target price of $58.5.
Invesco QQQ Trust, Series 1 (QQQ) is -0.12 at $403.62, with 2,379,550 shares traded., following a 52-week high recorded in today's regular session.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-12
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Telecom giant AT&T (NYSE: T) gets talked about often in the investing world, but it isn't typically positive. Despite having a commanding market share (47% of U.S. wireless subscriptions in the third quarter) and strong market presence, AT&T's stock has performed as badly as anyone could've anticipated over the past few years. It's now down over 40% from its high over the past five years.
There's no need to harp on the past, though. The company has had some notable missteps, but investing is a forward-thinking game, so we'll focus on that. Considering AT&T's low stock price, many investors are wondering if now's the time to invest. For long-term investors, I believe the answer is yes.
AT&T's high dividend can be a good source of income
You can't talk about AT&T's stock without discussing its dividend. It's been the only thing keeping investors patient while the company tries to steer the ship in the right direction. It's also the primary thing that would attract new investors.
AT&T has one of the highest dividends in the S&P 500, with a trailing-12-month yield of around 6.7%. Unfortunately, part of the reason the dividend yield is so high is because AT&T's stock price has been falling. Regardless, AT&T's lucrative dividend is appealing to investors seeking consistent income.
One reservation about AT&T was its ability to sustain its dividend, but recent results show it can. AT&T made $5.2 billion in free cash flow in the third quarter, bringing the total to $10.4 billion for the year, so far. That's nearly $2.4 billion more than the same time frame in 2022 and plenty more than its dividend obligation.
T Free Cash Flow Per Share data by YCharts
AT&T is getting back to focusing on its roots
AT&T has had ambitious plans in the past decade or so, particularly in the media and entertainment industry. All it led to was high debt levels and an eventual $43 billion WarnerMedia spinoff in April 2022. Not good.
The good news, however, is that AT&T was able to use around $40 billion from the proceeds to reduce its net debt in the second quarter of 2022. After peaking at over $200 billion in long-term debt in 2022, AT&T has since reduced it to around $138 billion (as of Sept. 30, 2023).
Post-WarnerMedia spinoff, AT&T has been taking concrete actions to refocus on its core telecom business.
In early December 2023, AT&T announced it would spend $14 billion over five years with networking and telecom company Ericsson. AT&T said it wants to shift around 70% of its wireless traffic to an Open Radio Access Network system, and this move makes Ericsson AT&T's main supplier of 5G equipment.
Without getting too much into the technical aspects, the move will allow AT&T to modernize its network infrastructure, ideally driving down costs. The transition will be costly for AT&T upfront, but it should be a worthwhile investment if it goes as planned, bolstering AT&T's 5G and fiber networks.
By 2029, 5G is estimated to account for over 71% of the U.S. mobile market. Whichever company can capitalize on the highly competitive postpaid phone market stands to gain a nice piece of the expanding pie. AT&T is already the biggest provider of wireless subscriptions in the U.S., with a 46.9% market share in the third quarter of 2023.
The postpaid phone market isn't a high-growth segment, but AT&T hopes the Ericsson deal can keep the momentum going with the growth of its fiber business. Fiber revenue was up 27% year over year in the third quarter, and considering fiber is only available to around 40% of U.S. households, there are plenty of growth opportunities.
AT&T is one of the premier telecom companies in the U.S., so it's good to see it making investments to enhance its core offerings. It might not have the glitz and glam of media and entertainment, but it puts AT&T in a position for more stable and profitable operations.
You can't gloss over AT&T's low valuation
The recent struggles make it almost impossible to glance over how relatively cheap AT&T's stock is now -- by almost any metric. Whether it's price-to-sales (revenue), price-to-earnings (profit), or price-to-free cash flow, AT&T is trading at much lower valuations than its competitors.
T PS Ratio data by YCharts
A stock being "cheap" doesn't always warrant investing in it, but in AT&T's case, I think it gives the company much more upside than downside. This is somewhat of a transitional period for AT&T, so a low valuation gives investors a chance to get in while the company is potentially undervalued.
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Stefon Walters has no position in any of the stocks mentioned. The Motley Fool recommends T-Mobile US and Verizon Communications. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-12
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Below is Validea's guru fundamental report for AT&T INC. (T). Of the 22 guru strategies we follow, T rates highest using our Shareholder Yield Investor model based on the published strategy of Meb Faber. This strategy looks for companies returning cash to shareholders via dividends, buybacks and debt paydown.
AT&T INC. (T) is a large-cap value stock in the Communications Services industry. The rating using this strategy is 95% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
UNIVERSE: PASS
NET PAYOUT YIELD: PASS
QUALITY AND DEBT: PASS
VALUATION: PASS
RELATIVE STRENGTH: PASS
SHAREHOLDER YIELD: PASS
Detailed Analysis of AT&T INC.
T Guru Analysis
T Fundamental Analysis
More Information on Meb Faber
Meb Faber Portfolio
About Meb Faber: Meb Faber is the founder of Cambria Investments. His research has covered a wide spectrum of the investment world, including topics like shareholder yield, trend following, global asset allocation and home country bias. His shareholder yield strategy, which is based on his book "Shareholder Yield" and forms the basis for an ETF of the same name, looks for companies that are focused on creating value for shareholders by returning cash to them in the form of dividends, share buybacks and debt paydown. Meb is also the author of 4 other books and numerous white papers on investing related topics.
Additional Research Links
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About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-12
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By Supantha Mukherjee
STOCKHOLM, Dec 12 (Reuters) - Finnish telecom equipment maker Nokia NOKIA.HE said on Tuesday it had revised down its comparable operating margin target to at least 13% by 2026 from at least 14% previously, after losing a deal with a U.S. telecom carrier.
Nokia said it still sees a path to achieving the previous target, but considering current market conditions in its mobile networks business, it deemed the revision prudent.
The company took a hit after AT&T T.N chose Ericsson ERICb.ST to build a telecom network using a new cost-cutting technology called open radio access network (ORAN) that will cover 70% of its wireless traffic in the United States by late 2026.
"AT&T is bad news, we are of course admitting it," Nokia chief executive Pekka Lundmark said in an interview, adding that it was a customer-specific situation, fairly financially driven and not technology or performance driven.
"We are not seeing this spreading to other customers," he said.
"We have been out of that network since 2017 and now we are making a comeback there through ORAN technology, so that is a significant win for us," Lundmark said.
Nokia also plans to revamp its mobile networks business by lowering its cost base to achieve a double-digit operating margin on sales of 10 billion euros ($10.78 billion) by 2026. It would need about 11.5 billion euros of sales to reach that level.
Nokia in October said it would cut up to 14,000 jobs to reduce costs, warning it did not expect any immediate market recovery after posting a 20% drop in third-quarter sales on weaker demand for 5G equipment.
($1 = 0.9281 euros)
(Reporting by Supantha Mukherjee and Anna Ringstrom, editing by Louise Rasmussen and Gerry Doyle)
((anna.ringstrom@thomsonreuters.com;))
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-12
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
2023 has been a mixed year. While growth stocks enjoyed the upside momentum, several industries suffered due to high inflation and low consumer spending. However, it looks like better days are ahead, and if you are planning to invest in dividend stocks, consider the company fundamentals before making a move. If the company is stable, has a solid balance sheet and has a strong dividend history, it will continue generating steady income for years to come. As we inch closer to 2024, it is time to reevaluate the stocks you own and invest in those that look promising and have the possibility of generating passive income. With that in mind, here are the three strong buy dividend stocks to consider.
Chevron (CVX)
Source: Jeff Whyte / Shutterstock.com
Oil giant Chevron (NYSE:CVX) has rewarded investors for years and it aims to increase capital spending by 11% in 2024. This is a sign that it will be focusing on new projects and will be able to deliver strong returns. When it has more money, it will be able to return more to the shareholders. It aims to invest around $15.5 billion to $16.5 billion into capital projects in the coming year and has a few acquisitions that will work as catalysts for business growth.
Chevron has agreed to purchase Hess Corp. (NYSE:HES) for $53 billion, and while the deal hasn’t closed yet, it is expected to add long-term value to the company. It has also just closed the acquisition of PDC Energy, and this deal is expected to add 1 billion barrels of oil equivalent reserves.
In the third quarter, the company reported an EPS of $3.05 and currently enjoys a dividend yield of 4.25%. It announced a quarterly dividend of $1.51 which isn’t too bad in the current times. With the high capital budget on the projects, Chevron will see significant growth in the coming year. I believe it will be able to sustain the dividends and continue rewarding shareholders for years to come. The stock is down 18% year to date and is much lower than the 52-week high of $187.
The company is focused on investments that pay off in the long term. It has increased the dividend payout for 36 years straight, and it aims to grow the dividend even faster, at 8% in January. Higher capital spending, increased cash flow, and steady dividends make the company worth an addition to your portfolio.
AT&T (T)
Source: Shutterstock
Many have written off the telecom giant AT&T (NYSE:T) but it still has a long way to go. I believe the worst is over for it. The company is currently working on revamping the wireless network services and has signed a deal with Ericsson(NASDAQ:ERIC) to invest $14 billion over the next five years.
This deal could be a game-changer for the business, and it has given a boost to the stock. It is expected that this collaboration will help cover about 70% of the company’s wireless traffic across the U.S. T stock is up 5% over the past month and trading at $16.42 today. I believe the stock can make a comeback in 2024.
The company expects to generate $16.5 billion in free cash flow this year and has been steadily growing its wireless subscriber base. In the third quarter, it added 468,000 net phone subscribers. It is already working on revamping the Open RAN technology and this is an investment that will pay off in the coming years.
As free cash flow and subscribers continue to grow, it will be able to reward shareholders significantly.
The company is investing in next-gen technology and this shows its commitment to catering to the needs of the users. As a dividend stock, AT&T is a strong pick. It enjoys a dividend yield of 6.75% and it has enough cash flow to support this dividend. Add T stock to your portfolio before it starts to soar in 2024.
Morgan Stanley (MS)
Source: Ken Wolter / Shutterstock.com
If you aren’t willing to start trusting traditional banks again, you can consider Morgan Stanley (NYSE:MS) which sets itself apart from the rest. While it is a bank, the big reason to invest in it is the diversified revenue streams.
The majority of its revenue comes from the wealth management division which ensures consistency and stability. Since it doesn’t work like a lending business, it has a steady flow of income and it is predictable income to some extent.
With an improvement in the market conditions, it looks like Morgan Stanley could start soaring with the investment banking business. There is a positive sentiment in the market and as we see new IPO openings, we could see Morgan Stanley report higher underwriting revenue numbers.
For the third quarter results, it reported an EPS of $1.38 and a revenue of $13.3 billion, much higher than analyst expectations. However, its wealth management business disappointed investors by only adding $36 billion in net assets.
The stock is significantly down from the 52-week high of $101 and has dropped by 3% year to date. This is a good chance to grab the dividend stock. It enjoys a dividend yield of 4.10% and recently announced a quarterly dividend of $0.85. The company is stable, has an impressive balance sheet, and several catalysts are working in its favor which shows that it has a high chance of bouncing back in the coming year.
On the date of publication, Vandita Jadeja did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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Vandita Jadeja is a CPA and a freelance financial copywriter who loves to read and write about stocks. She believes in buying and holding for long term gains. Her knowledge of words and numbers helps her write clear stock analysis.
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The post 3 Strong-Buy Dividend Stocks for Promising Passive Income appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-11
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For the better part of six decades, Berkshire Hathaway (NYSE: BRK.A)(NYSE: BRK.B) CEO Warren Buffett has been running circles around Wall Street. With the help of his investment team, which includes the late, great Charlie Munger, Buffett has overseen a nearly 20% annualized return since the mid-1960s in Berkshire's Class A shares (BRK.A). That's double the annualized total return of the benchmark S&P 500, including dividends, over the same stretch.
Riding the Oracle of Omaha's coattails has been a no-brainer moneymaking strategy, which is why investors eagerly await Berkshire's Form 13F filings with the Securities and Exchange Commission. A 13F provides a detailed snapshot of what Wall Street's smartest and most-successful money managers bought and sold in the latest quarter.
The interesting thing about Berkshire Hathaway is its 13Fs don't tell the complete story.
In 1998, Buffett's company acquired General Re for $22 billion. While the purpose of this transaction was to add General Re's reinsurance operations to the mix, General Re also owned a specialty investment firm known as New England Asset Management (NEAM). When Berkshire closed its acquisition of General Re, it became the owner of NEAM.
Image source: Getty Images.
As of Sept. 30, 2023, New England Asset Management had nearly $610 million in invested assets, and is therefore required to file a quarterly 13F. Though Buffett doesn't oversee NEAM's invested assets, what NEAM owns is ultimately part of Berkshire Hathaway. Put another way, New England Asset Management is Warren Buffett's "secret" portfolio.
This secret portfolio closed out the third quarter with 111 holdings. Five of these phenomenal stocks stand out as screaming buys for 2024.
AT&T
The first amazing stock to buy in Warren Buffett's hidden portfolio for the upcoming year is telecom company AT&T (NYSE: T). Although AT&T's shares hit a three-decade low earlier this year on concerns about lead-sheathed cables still in use, this worry appears to be much ado about nothing.
The important consideration for investors is that 5G download speeds are moving the needle in the right direction for AT&T. Upgrading its network to support 5G speeds will encourage its wireless customers to use more data. Data is the leading margin driver for the company's wireless segment.
Additionally, moving to 5G speeds is helping AT&T land new broadband customers. This should be the sixth consecutive year it adds at least 1 million net broadband subscribers, which increases the likelihood of its customers bundling their services.
But perhaps the best thing about AT&T as an investment is its meaningfully improved balance sheet. As of the end of March 2022, just prior to completing the spinoff of content arm WarnerMedia, AT&T was sitting on $169 billion in net debt. But after more than $40 billion in concessions following the merger of WarnerMedia with Discovery to create Warner Bros. Discovery, AT&T's net debt has shrunk to $128.7 billion, as of Sept. 30, 2023. This means its nearly 7% dividend yield is secure moving forward.
Johnson & Johnson
Healthcare conglomerate Johnson & Johnson (NYSE: JNJ) is the second phenomenal stock in Buffett's secret portfolio that's a surefire buy in 2024. Even with the legal overhang of roughly 100,000 lawsuits that allege the company's now-discontinued baby powder causes cancer, J&J is perfectly positioned to deliver for its patient shareholders.
There are only two publicly traded companies that bear the coveted AAA-credit rating from Standard & Poor's (S&P), a division of S&P Global, and J&J is one of them. S&P has the utmost confidence that Johnson & Johnson can service and repay its outstanding debts. J&J's pristine balance sheet and substantive operating cash flow is why a potential settlement for the outstanding lawsuits isn't a huge concern.
What makes Johnson & Johnson such an incredible buy is its more than decade-long shift toward pharmaceuticals. Brand-name drugs generate considerably higher margins and afford J&J excellent pricing power, in relation to the consumer health products division (Kenvue) the company recently spun off.
Johnson & Johnson is also cheaper than it's been in a long time. Its forward price-to-earnings (P/E) ratio of 14.7 represents a low-water mark from where the company closed out the previous 10 years.
Image source: Getty Images.
Bank of America
A familiar name in Warren Buffett's secret portfolio that you'll also find in Berkshire Hathaway's $361 billion investment portfolio is Bank of America (NYSE: BAC). Despite near-term recessionary concerns dragging down BofA's stock, the company finds itself in prime position to take advantage of the current economic climate.
To begin with, bank stocks are inherently cyclical. This is to say they thrive when the U.S. economy is firing on all cylinders and struggle during periods of contraction. The thing is, recessions are historically short-lived. Only three of the 12 U.S. recessions following World War II have lasted at least one year, with none surpassing 18 months. Over long periods, bank stocks like BofA tend to grow right alongside the U.S. and global economy.
Something else to note about Bank of America is its sensitivity to interest rates. No money-center bank will see its net-interest income swing more from changes in the prevailing interest rate than BofA. With the Federal Reserve combatting historically high inflation, the 525-basis-point aggregate increase in the federal funds rate has added billions in net-interest income to Bank of America's bottom line each quarter.
Lastly, there's plenty of value for long-term investors to latch onto. BofA stock ended Dec. 4 approximately 6% below its book value. Being able to purchase shares in a top-tier bank for less than book value makes Bank of America a screaming bargain.
PayPal Holdings
Fintech stock PayPal Holdings (NASDAQ: PYPL) is another company found in Warren Buffett's secret portfolio that stands out as a genius buy for the upcoming year. Although an above-average inflation rate has threatened to reduce the discretionary spending power of low-earning workers, PayPal's key performance metrics are headed in the right direction.
Even amid a challenging economic climate, the total payment volume (TPV) traversing PayPal's networks, which includes Venmo, has continued to grow by a double-digit basis, excluding currency movements. If TPV can sustain low-double-digit growth with the near-term economic outlook uncertain, imagine how quickly it'll grow on a sustained basis during a multiyear period of expansion.
PayPal's user engagement trends are, arguably, even more important. When 2020 came to an end, active accounts were completing nearly 41 transactions over the trailing-12-month (TTM) period. But as of Sept. 30, 2023, the average number of transactions on the platform for active accounts had risen to 56.6 over the TTM. Since PayPal is primarily a fee-driven company, a more-engaged user base will lead to higher gross profit.
Fintech's industry leader is also trading at its lowest valuation since being spun off by eBay in 2015. Shares can be purchased right now for less than 11 times forward-year earnings, which compares to an average forward-year multiple of 35 over the past five years.
Alphabet
The fifth phenomenal stock in Warren Buffett's secret portfolio that makes for a screaming buy in 2024 is Alphabet (NASDAQ: GOOGL)(NASDAQ: GOOG), the parent company of internet search engine Google and streaming platform YouTube. Specifically, New England Asset Management owns the Class A shares (GOOGL).
For well over a decade, Google has been Alphabet's foundational operating segment. In November, it accounted for 91.5% of global internet search share, which was more than 88 percentage points higher than its closest competitor. Businesses understand that Google gives them the best chance to target consumers with their message(s), which in turn affords Alphabet excellent ad-pricing power.
However, Alphabet's future is all about its faster-growing ancillary operations. YouTube is attracting more than 2.7 billion monthly active users, which is bound to drive ad-pricing power in its favor. Meanwhile, Google Cloud has produced three consecutive quarterly profits and has gobbled up 10% of worldwide cloud infrastructure service share. Cloud service margins are considerably juicier than advertising margins and could really spice up Alphabet's cash flow in the second-half of the decade.
To keep with the theme, Alphabet's stock is historically cheap and ripe for the picking. Even following a healthy 46% year-to-date gain, Alphabet shares can be picked up for a little over 13 times forward-year cash flow. That compares to the multiple of 18 times cash flow Alphabet has averaged over the previous five years.
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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Bank of America is an advertising partner of The Ascent, a Motley Fool company. Sean Williams has positions in AT&T, Alphabet, Bank of America, PayPal, and Warner Bros. Discovery and has the following options: long June 2025 $13 calls on AT&T. The Motley Fool has positions in and recommends Alphabet, Bank of America, Berkshire Hathaway, Kenvue, PayPal, S&P Global, and Warner Bros. Discovery. The Motley Fool recommends Johnson & Johnson and eBay and recommends the following options: short December 2023 $67.50 puts on PayPal and short January 2024 $45 calls on eBay. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-11
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Launched on 04/16/2013, the iShares MSCI USA Value Factor ETF (VLUE) is a smart beta exchange traded fund offering broad exposure to the Style Box - Large Cap Value category of the market.
What Are Smart Beta ETFs?
The ETF industry has traditionally been dominated by products based on market capitalization weighted indexes that are designed to represent the market or a particular segment of the market.
Investors who believe in market efficiency should consider market cap indexes, as they replicate market returns in a low-cost, convenient, and transparent way.
However, some investors believe in the possibility of beating the market through exceptional stock selection, and choose a different type of fund that tracks non-cap weighted strategies: smart beta.
This kind of index follows this same mindset, as it attempts to pick stocks that have better chances of risk-return performance; non-cap weighted strategies base selection on certain fundamental characteristics, or a mix of such characteristics.
Methodologies like equal-weighting, one of the simplest options out there, fundamental weighting, and volatility/momentum based weighting are all choices offered to investors in this space, but not all of them can deliver superior returns.
Fund Sponsor & Index
Managed by Blackrock, VLUE has amassed assets over $6.53 billion, making it one of the larger ETFs in the Style Box - Large Cap Value. Before fees and expenses, this particular fund seeks to match the performance of the MSCI USA Enhanced Value Index.
The MSCI USA Enhanced Value Index is based on a traditional market capitalization-weighted parent index, the MSCI USA Index which includes U.S. large and mid capitalization stocks.
Cost & Other Expenses
Since cheaper funds tend to produce better results than more expensive funds, assuming all other factors remain equal, it is important for investors to pay attention to an ETF's expense ratio.
Annual operating expenses for this ETF are 0.15%, making it one of the least expensive products in the space.
It's 12-month trailing dividend yield comes in at 2.86%.
Sector Exposure and Top Holdings
ETFs offer diversified exposure and thus minimize single stock risk, but it is still important to delve into a fund's holdings before investing. Most ETFs are very transparent products and many disclose their holdings on a daily basis.
Representing 29.30% of the portfolio, the fund has heaviest allocation to the Information Technology sector; Financials and Healthcare round out the top three.
Taking into account individual holdings, Intel Corporation Corp (INTC) accounts for about 5.91% of the fund's total assets, followed by At&t Inc (T) and Cisco Systems Inc (CSCO).
VLUE's top 10 holdings account for about 34.52% of its total assets under management.
Performance and Risk
The ETF has gained about 8.02% so far this year and is up roughly 4.39% in the last one year (as of 12/11/2023). In the past 52-week period, it has traded between $85.95 and $99.54.
The ETF has a beta of 1.05 and standard deviation of 17.97% for the trailing three-year period, making it a medium risk choice in the space. With about 152 holdings, it effectively diversifies company-specific risk.
Alternatives
IShares MSCI USA Value Factor ETF is an excellent option for investors seeking to outperform the Style Box - Large Cap Value segment of the market. There are other ETFs in the space which investors could consider as well.
IShares Russell 1000 Value ETF (IWD) tracks Russell 1000 Value Index and the Vanguard Value ETF (VTV) tracks CRSP U.S. Large Cap Value Index. IShares Russell 1000 Value ETF has $52.05 billion in assets, Vanguard Value ETF has $101.63 billion. IWD has an expense ratio of 0.19% and VTV charges 0.04%.
Investors looking for cheaper and lower-risk options should consider traditional market cap weighted ETFs that aim to match the returns of the Style Box - Large Cap Value.
Bottom Line
To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-11
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Below is Validea's guru fundamental report for AT&T INC. (T). Of the 22 guru strategies we follow, T rates highest using our Shareholder Yield Investor model based on the published strategy of Meb Faber. This strategy looks for companies returning cash to shareholders via dividends, buybacks and debt paydown.
AT&T INC. (T) is a large-cap growth stock in the Communications Services industry. The rating using this strategy is 95% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
UNIVERSE: PASS
NET PAYOUT YIELD: PASS
QUALITY AND DEBT: PASS
VALUATION: PASS
RELATIVE STRENGTH: PASS
SHAREHOLDER YIELD: PASS
Detailed Analysis of AT&T INC.
T Guru Analysis
T Fundamental Analysis
More Information on Meb Faber
Meb Faber Portfolio
About Meb Faber: Meb Faber is the founder of Cambria Investments. His research has covered a wide spectrum of the investment world, including topics like shareholder yield, trend following, global asset allocation and home country bias. His shareholder yield strategy, which is based on his book "Shareholder Yield" and forms the basis for an ETF of the same name, looks for companies that are focused on creating value for shareholders by returning cash to them in the form of dividends, share buybacks and debt paydown. Meb is also the author of 4 other books and numerous white papers on investing related topics.
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About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-11
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Fool.com contributor Parkev Tatevosian compares AT&T (NYSE: T) and RTX (NYSE: RTX) on critical financial metrics, including the dividend yield, to determine which is the better dividend stock to buy today.
*Stock prices used were the afternoon prices of Dec. 7, 2023. The video was published on Dec. 9, 2023.
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Parkev Tatevosian, CFA has no position in any of the stocks mentioned. The Motley Fool recommends RTX. The Motley Fool has a disclosure policy. Parkev Tatevosian is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through his link, he will earn some extra money that supports his channel. His opinions remain his own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-11
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Looking at the underlying holdings of the ETFs in our coverage universe at ETF Channel, we have compared the trading price of each holding against the average analyst 12-month forward target price, and computed the weighted average implied analyst target price for the ETF itself. For the iShares S&P 100 ETF (Symbol: OEF), we found that the implied analyst target price for the ETF based upon its underlying holdings is $240.04 per unit.
With OEF trading at a recent price near $216.45 per unit, that means that analysts see 10.90% upside for this ETF looking through to the average analyst targets of the underlying holdings. Three of OEF's underlying holdings with notable upside to their analyst target prices are PayPal Holdings Inc (Symbol: PYPL), AT&T Inc (Symbol: T), and ConocoPhillips (Symbol: COP). Although PYPL has traded at a recent price of $59.25/share, the average analyst target is 26.75% higher at $75.10/share. Similarly, T has 25.26% upside from the recent share price of $16.63 if the average analyst target price of $20.83/share is reached, and analysts on average are expecting COP to reach a target price of $137.09/share, which is 22.74% above the recent price of $111.70. Below is a twelve month price history chart comparing the stock performance of PYPL, T, and COP:
Below is a summary table of the current analyst target prices discussed above:
NAME SYMBOL RECENT PRICE AVG. ANALYST 12-MO. TARGET % UPSIDE TO TARGET
iShares S&P 100 ETF OEF $216.45 $240.04 10.90%
PayPal Holdings Inc PYPL $59.25 $75.10 26.75%
AT&T Inc T $16.63 $20.83 25.26%
ConocoPhillips COP $111.70 $137.09 22.74%
Are analysts justified in these targets, or overly optimistic about where these stocks will be trading 12 months from now? Do the analysts have a valid justification for their targets, or are they behind the curve on recent company and industry developments? A high price target relative to a stock's trading price can reflect optimism about the future, but can also be a precursor to target price downgrades if the targets were a relic of the past. These are questions that require further investor research.
10 ETFs With Most Upside To Analyst Targets »
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-11
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Looking today at week-over-week shares outstanding changes among the universe of ETFs covered at ETF Channel, one standout is the The Communication Services Select Sector SPDR Fund (Symbol: XLC) where we have detected an approximate $433.5 million dollar inflow -- that's a 2.9% increase week over week in outstanding units (from 212,000,000 to 218,150,000). Among the largest underlying components of XLC, in trading today AT&T Inc (Symbol: T) is down about 2.1%, Verizon Communications Inc (Symbol: VZ) is off about 1.9%, and T-Mobile US Inc (Symbol: TMUS) is up by about 1.8%. For a complete list of holdings, visit the XLC Holdings page » The chart below shows the one year price performance of XLC, versus its 200 day moving average:
Looking at the chart above, XLC's low point in its 52 week range is $46.475 per share, with $71.495 as the 52 week high point — that compares with a last trade of $69.66. Comparing the most recent share price to the 200 day moving average can also be a useful technical analysis technique -- learn more about the 200 day moving average ».
Exchange traded funds (ETFs) trade just like stocks, but instead of ''shares'' investors are actually buying and selling ''units''. These ''units'' can be traded back and forth just like stocks, but can also be created or destroyed to accommodate investor demand. Each week we monitor the week-over-week change in shares outstanding data, to keep a lookout for those ETFs experiencing notable inflows (many new units created) or outflows (many old units destroyed). Creation of new units will mean the underlying holdings of the ETF need to be purchased, while destruction of units involves selling underlying holdings, so large flows can also impact the individual components held within ETFs.
Click here to find out which 9 other ETFs had notable inflows »
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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-10
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Telecom giant AT&T (NYSE: T) is embarking on a revamp of its wireless network infrastructure. The company announced last week that it had signed a deal with Sweden's Ericsson to spend as much as $14 billion over five years to deploy open radio access network, or Open RAN, technology.
Within a wireless network, the RAN is responsible for connecting end-user devices to the core network. Devices such as smartphones send data to a RAN's transceivers, which then does complex processing before passing that data along to the core wireless network. That core network then connects to the internet.
RANs are a mix of hardware and software. AT&T currently uses proprietary solutions that couple together hardware and software. Open RAN disaggregates the different components, allowing for hardware from different vendors and software from different vendors to work together. By adopting Open RAN technology, AT&T will have the ability to mix and match suppliers and build a highly flexible network that is potentially more cost-efficient.
The plan is to have Open RAN sites operating in 2024 before scaling up using multiple suppliers in 2025. By late 2026, AT&T expects to be running 70% of its wireless network traffic through its Open RAN deployments. The increased flexibility should help AT&T speed up the deployment of next-generation wireless technology when it becomes available.
Meaningful benefits
AT&T CEO John Stankey made it clear during a conference soon after the announcement that this Open RAN deal was not a game changer. It will, however, provide some important benefits in the long run.
For AT&T, more competition in the Open RAN market is a good thing. It means more hardware and software choices, better products, and potentially better pricing as vendors compete for business. One reason AT&T committed to Open RAN was to spur competition in the hopes of lowering network costs and boosting efficiencies.
"I don't think it's going to move the needle from a capital intensity perspective," Stankey said about the Open RAN deal. The company isn't changing its overall outlook for capital spending. However, the efficiencies Open RAN eventually unlocks could allow AT&T to boost investment in other areas.
Fiber internet is a long-term growth opportunity for the company, but laying fiber is expensive, and the payoff doesn't come until homes and businesses become subscribers. AT&T is planning to pass 30 million locations with its fiber network by the end of 2025, but there may be room to boost that target higher thanks to the Open RAN deal. By making its wireless capital spending go further by adopting Open RAN, any savings could be reallocated to expanding the fiber network .
This Open RAN deal means a lot more to AT&T's vendors in terms of near-term financial impact than AT&T itself. But it should yield long-term benefits that are harder to quantify for AT&T, including increased flexibility and a simplification of its network infrastructure.
AT&T stock is a buy, Open RAN or not
The Open RAN deal isn't a reason to pile into AT&T stock, but a rock-bottom valuation, solid performance in the wireless business, and a sky-high dividend certainly are.
With AT&T expecting to generate around $16.5 billion of free cash flow this year, the stock trades for just over 7 times free cash flow. That's a valuation that doesn't reflect AT&T's solid performance. The company has been consistently growing its wireless subscriber base, adding 468,000 net postpaid phone subscribers in the third quarter, and its fiber business has been expanding by nearly 300,000 subscribers per quarter.
That free cash flow more than supports the dividend, which currently yields 6.5%. The dividend consumes less than half of AT&T's free cash flow, based on the company's guidance, leaving plenty left over for debt reduction.
AT&T is making a forward-thinking decision to revamp its wireless network with Open RAN technology. While there won't be a huge payoff in the short term, the switch positions the company to improve the efficiency of its network in the long run. That's good news for shareholders as AT&T works to grow its free cash flow generation and pay down some of its debt.
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Timothy Green has positions in AT&T. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-08
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Below is Validea's guru fundamental report for AT&T INC. (T). Of the 22 guru strategies we follow, T rates highest using our Shareholder Yield Investor model based on the published strategy of Meb Faber. This strategy looks for companies returning cash to shareholders via dividends, buybacks and debt paydown.
AT&T INC. (T) is a large-cap growth stock in the Communications Services industry. The rating using this strategy is 95% based on the firm’s underlying fundamentals and the stock’s valuation. A score of 80% or above typically indicates that the strategy has some interest in the stock and a score above 90% typically indicates strong interest.
The following table summarizes whether the stock meets each of this strategy's tests. Not all criteria in the below table receive equal weighting or are independent, but the table provides a brief overview of the strong and weak points of the security in the context of the strategy's criteria.
UNIVERSE: PASS
NET PAYOUT YIELD: PASS
QUALITY AND DEBT: PASS
VALUATION: PASS
RELATIVE STRENGTH: PASS
SHAREHOLDER YIELD: PASS
Detailed Analysis of AT&T INC.
T Guru Analysis
T Fundamental Analysis
More Information on Meb Faber
Meb Faber Portfolio
About Meb Faber: Meb Faber is the founder of Cambria Investments. His research has covered a wide spectrum of the investment world, including topics like shareholder yield, trend following, global asset allocation and home country bias. His shareholder yield strategy, which is based on his book "Shareholder Yield" and forms the basis for an ETF of the same name, looks for companies that are focused on creating value for shareholders by returning cash to them in the form of dividends, share buybacks and debt paydown. Meb is also the author of 4 other books and numerous white papers on investing related topics.
Additional Research Links
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Dividend Aristocrats 2023
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Top S&P 500 Stocks
About Validea: Validea is aninvestment researchservice that follows the published strategies of investment legends. Validea offers both stock analysis and model portfolios based on gurus who have outperformed the market over the long-term, including Warren Buffett, Benjamin Graham, Peter Lynch and Martin Zweig. For more information about Validea, click here
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-08
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The NASDAQ 100 After Hours Indicator is up 1.18 to 16,085.87. The total After hours volume is currently 158,610,745 shares traded.
The following are the most active stocks for the after hours session:
AT&T Inc. (T) is -0.01 at $16.91, with 8,136,375 shares traded. T's current last sale is 84.55% of the target price of $20.
Intel Corporation (INTC) is unchanged at $42.70, with 7,770,153 shares traded. INTC's current last sale is 112.37% of the target price of $38.
Arm Holdings plc (ARM) is +0.1145 at $67.34, with 6,243,010 shares traded. As reported by Zacks, the current mean recommendation for ARM is in the "buy range".
Hawaiian Holdings, Inc. (HA) is unchanged at $13.31, with 5,839,375 shares traded. HA's current last sale is 332.75% of the target price of $4.
Paramount Global (PARA) is -0.0298 at $16.82, with 5,733,822 shares traded. PARA's current last sale is 134.56% of the target price of $12.5.
Ford Motor Company (F) is +0.0002 at $11.01, with 4,913,329 shares traded. F's current last sale is 78.64% of the target price of $14.
Western Digital Corporation (WDC) is +0.0009 at $47.86, with 4,554,172 shares traded. As reported by Zacks, the current mean recommendation for WDC is in the "buy range".
Navitas Semiconductor Corporation (NVTS) is -0.02 at $7.52, with 4,102,184 shares traded. Over the last four weeks they have had 3 up revisions for the earnings forecast, for the fiscal quarter ending Dec 2023. The consensus EPS forecast is $-0.13. As reported by Zacks, the current mean recommendation for NVTS is in the "buy range".
Sensata Technologies Holding plc (ST) is unchanged at $33.36, with 3,630,171 shares traded. ST's current last sale is 74.13% of the target price of $45.
Verizon Communications Inc. (VZ) is -0.0501 at $38.20, with 3,605,787 shares traded. VZ's current last sale is 93.17% of the target price of $41.
Amphenol Corporation (APH) is unchanged at $93.23, with 3,248,474 shares traded., following a 52-week high recorded in today's regular session.
Toast, Inc. (TOST) is unchanged at $15.35, with 2,427,596 shares traded. TOST's current last sale is 85.28% of the target price of $18.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-08
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Investors look at blue-chip stocks for dividends and capital preservation. However, dividend stocks do not always trend higher. There are years or phases of price or time correction due to temporary industry or company-specific headwinds.
For value investors, I see a correction in quality blue-chip stocks as a golden opportunity to accumulate. I am reminded of Charlie Munger’s idea of delayed gratification. It’s difficult to predict the time for a reversal rally. However, when it comes to total returns from these oversold stocks, they can be robust. My focus in this column is on three blue-chip stocks that are likely to make a strong comeback next year.
I must add here that macroeconomic headwinds are likely to be sustained next year. By adding these top blue-chip stocks to the portfolio, investors can reduce the overall portfolio beta. Further, since these stocks already trade at a deep valuation gap, the downside is capped even if the market trends lower.
Let’s talk about the reasons to be positive about these blue-chip ideas.
AT&T (T)
Source: Shutterstock
The worst for AT&T (NYSE:T) stock seems to be over with an upside of 6% in the last six months. Of course, the rally has been sluggish but it is an early indication of a potential reversal in stock trend. This was entirely likely with T stock trading at a forward price-earnings ratio of 7. Further, the stock offers an attractive dividend yield of 6.55%.
Besides the valuation, business and financial developments have been positive. The recent collaboration with Ericson will help AT&T open more radio access networks for a better connection through 5G and fiber networks in North America. By 2026, the collaboration is expected to cover 70% of the company’s wireless traffic in the U.S.
From a financial perspective, AT&T reported an operating cash flow of $26.9 billion for the first nine months of 2023. The annualized OCF potential is approximately $36 billion and provides scope for aggressive investments and deleveraging. At the same time, dividends are secure. I must add that with continued growth in 5G and fiber subscribers, the revenue outlook is positive.
Lockheed Martin (LMT)
Source: ranchorunner / Shutterstock.com
In a year where global geopolitical tensions escalated, I am surprised that Lockheed Martin (NYSE:LMT) stock has marginally trended lower. This looks like a good opportunity to accumulate and a forward price-to-earnings ratio of 16.4 underscores my view.
As of Q3 2023, Lockheed reported an order backlog of $156 billion. This provides clear revenue and cash flow visibility. The company has guided for a free cash flow of $6.2 billion for the year. As growth potentially accelerates in 2024 and beyond, FCF is likely to swell.
I also like the fact that Lockheed is aggressively investing in next-generation defense technology. This month, the company successfully conducted a JAGM-MR guided flight test which can help missiles to discriminate between multiple targets. Lockheed is also investing in next-generation interceptors to protect against long-range ballistic missile attacks. Investment in technological advancement will ensure that the order backlog remains robust.
Pfizer (PFE)
Source: photobyphm / Shutterstock.com
During the COVID-19 pandemic, the bio-pharmaceutical sector was in the limelight. However, in a post-pandemic world, investors have focused on other sectors where growth seems relatively attractive. As a result, some of the best pharmaceutical stocks are trading at a considerable valuation gap. Pfizer (NYSE:PFE) is one stock that deserves a place in many portfolios and looks poised for a comeback.
An important reason to like Pfizer is a strong pipeline of new products. Through the first half of 2024, the company expects to launch up to 18 new products. Additionally, the long-term pipeline is attractive and Pfizer expects to generate $20 billion in incremental revenue from new molecular entities by 2030.
Further, new business deals are also expected to add an additional revenue of $25 billion by 2030. One such deal is the acquisition of cancer drug maker Seagen (NASDAQ:SGEN) for $43 billion. It’s likely that growth will accelerate in the coming years coupled with strong cash flows. Once the sector is back in focus, PFE stock is likely to surge higher from oversold levels.
On the date of publication, Faisal Humayun did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Faisal Humayun is a senior research analyst with 12 years of industry experience in the field of credit research, equity research and financial modeling. Faisal has authored over 1,500 stock specific articles with focus on the technology, energy and commodities sector.
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The post 3 Blue-Chip Stocks Set to Make a Comeback in 2024 appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-08
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
The nationwide rollout of the 5G mobile network three years ago marked a critical moment in telecommunications, ushering in a new era of investment in 5G stocks. This upgrade from 4G LTE to 5G represented a quantum leap in technology, promising download speeds up to 100 times faster. Beyond the buzz of lightning-fast internet, 5G remains a powerful catalyst for cutting-edge advancements across a myriad of sectors from artificial intelligence to autonomous vehicles.
The valuation of the 5G market started at an impressive $5.53 billion in 2020 and is expected to skyrocket to an astounding $667.9 billion by 2026. Factors driving this rapid expansion include the increased adoption of virtual networking architecture and the surge in mobile data traffic. Moreover, the influence of 5G stretches beyond telecommunications, infusing sectors such as healthcare, automotive and manufacturing while promising a future woven with revolutionary technologies.
Here are three top 5G stocks for investors to focus on if they want to take advantage of the expected growth in this sector.
American Tower (AMT)
Source: T. Schneider / Shutterstock
American Tower (NYSE:AMT) boasts over 225,000 communication sites making it a colossus in the global telecom landscape and critical to the burgeoning 5G sector. As a real estate investment trust (REIT), the company leases tower space to various clients including wireless service providers, broadcasters, public sector organizations and other entities. With it operating under long-term leases of five to 10 years, the firm maintains exceptionally low churn rates, though a lease with T-Mobile (NYSE:TMUS) is currently set to expire in 2025.
Furthermore, in adherence to REIT requirements, it distributes a hefty 90% of its profits as dividends, yielding a healthy 3.2%. The third quarter saw the company outperform expectations, leading to an upward revision of its funds-from-operations per share guidance. Hence, for those eyeing dividends, AMT’s compelling 3% yield and a decade-long history of consistent payout growth make it a standout choice among 5G stocks.
T-Mobile (TMUS)
Source: Shutterstock
T-Mobile (NYSE:TMUS) is the third-largest wireless internet carrier in the U.S., dynamically expanding its customer base in its niche briskly. The company’s steadfast focus on adding postpaid wireless customers is paying off, with a clear path towards adding a remarkable 8 million customers by 2025. Notably, T-Mobile’s 5G network deployment advancement places it ahead of its primary competition, solidifying its leadership in the 5G internet rollout. T-Mobile’s board recently pivoted by authorizing a $14 billion share repurchase program, signaling a long-term strategy to buy back $60 billion in stock.
In a strategic turn, TMUS announced its first-ever dividend, which resonated positively with shareholders. The company’s financial performance in the third quarter was impressive, generating a whopping $4 billion in free cash flow (FCF), a massive 50% increase from the same period last year. This surge was attributed to reduced cash outlays for property and equipment and increased cash flow from operations. Additionally, TMUS bolstered its financial health with a rise in net income to $2.1 billion and a boost in net cash to $5.3 billion.
AT&T (T)
Source: Roman Tiraspolsky / Shutterstock.com
In the dynamic landscape of the telecom industry, AT&T (NYSE:T) emerges as a standout contender and is skillfully navigating the 5G market. Its current undervaluation presents a golden opportunity for savvy investors to scoop up the stock at just one times forward sales estimates. Additionally, the company’s strong customer loyalty highlights AT&T’s service excellence and underpins its robust financial health.
Financially, AT&T’s performance is nothing short of impressive. In the third quarter, the company saw a significant uptick in operating margins of 24.9% and an EBITDA margin jump to 43%. It expects its FCF to rise to $16.5 billion for the full year, a $500 million improvement from previous estimates.
Moreover, AT&T’s 468,000 postpaid phone net additions this quarter are a testament to its growing appeal and the effectiveness of its strategies in attracting and retaining customers. AT&T’s current market position, financial performance and growth prospects make it an appealing choice for those looking to invest in 5G stocks.
On the date of publication, Muslim Farooque did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Muslim Farooque is a keen investor and an optimist at heart. A life-long gamer and tech enthusiast, he has a particular affinity for analyzing technology stocks. Muslim holds a bachelor’s of science degree in applied accounting from Oxford Brookes University.
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The post Telecom Titans: 3 Stocks Outperforming in the 5G Race appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-07
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
It’s understandable if you have whiplash from market moves this year. We’ve seen stocks surge, fall and surge again on the heels of the current Santa rally. But, though investors are flocking to small-caps and growth stocks, blue-chip stocks might be the best bet for your portfolio.
We aren’t out of the woods economically. Not by a long shot. And it’ll just take one bad catalyst to push speculative stocks back into the gutter. To that end, you should be looking for opportunities to snag undervalued stocks that represent stability and maturity. In other words, you’re looking at these three blue-chip stocks to buy as the best bet to position yourself for a solid 2024.
AT&T (T)
Source: Roman Tiraspolsky / Shutterstock.com
AT&T (NYSE:T) is the quintessential blue-chip stock. Though the company dipped this summer on the heels of the lead shielding debacle, shares are rebounding as the issue appears far less serious than initially thought. In the meantime, shares remain undervalued at about 10% below their early-2023 pricing, meaning there’s still time to ride the blue-chip stock back to the top.
Though blue-chip stocks in general, and utilities specifically, usually lack innovation that growth stocks exhibit, AT&T stands in stark contrast. This week, the company announced a new network expansion to save money and improve user experience. The emerging tech will service 70% of AT&T’s U.S. wireless traffic by 2026. Willingness to expand is a hallmark of stable blue-chip stocks, as many are often rewarded for playing it safe. But AT&T is willing to go out on a limb, as also evidenced by its recent partnership with AST SpaceMobile (NASDAQ:ASTS) to explore low-earth satellite communications.
Of course, another hallmark of blue-chip stocks is their dividend yield, and AT&T meets this mark and then some. Its current dividend yield is 6.62%, combined with a 55% payout ratio, which means stability and income opportunity for investors.
Medtronic (MDT)
Source: JHVEPhoto / Shutterstock.com
It’s hard to beat tech or healthcare stocks if you invest for the long haul. Luckily, Medtronic (NYSE:MDT) combines both with a blue-chip sensibility that’s hard to beat. The company posted a few rocky quarters amid the pandemic.
The poor performance mostly came from slowed elective and non-emergent surgery rates, but as that front stabilizes, Medtronic is posting a rapid turnaround. Its most recent earnings report saw Medtronic’s revenue climb 5% year-over-year, and management pushed its annual forecast higher.
Medtronic stands at a unique intersection between healthcare (an ever-growing industry) and tech. The company is collaborating with Nvidia (NASDAQ:NVDA), for example, to develop next-gen, AI-enabled diagnostic tools. Like AT&T, this willingness to innovate bodes well for Medtronic’s future while it retains blue-chip maturity and status.
Medtronic offers a 3.66% total yield, and shares remain undervalued by nearly every measure despite a recent resurgence.
RTX (RTX)
Source: JHVEPhoto / Shutterstock.com
RTX (NYSE:RTX) is another blue-chip winner that saw some turbulence before mounting a comeback in recent months. Shares remain 17% down year-to-date but have bounced more than 15% since October, indicating its current run still has legs.
The company’s recent earnings sparked renewed enthusiasm as management reported expectation-beating top and bottom line numbers. The firm also announced a massive $10 billion buyback program that gave shareholders much to be happy about alongside the current 2.82% dividend yield.
The company seems to be beyond past troubles with engine coating contamination. The firm did a whirlwind global tour to examine, diagnose, and repair airplane engine issues resulting from the contamination. Investors rightfully feared that costs could spiral out of control if the issue proved more prevalent than initially thought.
But, in the recent call, company management assured investors there wouldn’t be unforeseen expenses. CEO Greg Hayes told investors, “We have made significant progress on our assessment of the Pratt & Whitney powder metal manufacturing matter and expect the financial impact to be in line with the previously disclosed charge.” This means there won’t be as much uncertainty surrounding RTX’s prospects, boding well for this blue-chip stock.
On the date of publication, Jeremy Flint held no positions in the securities mentioned. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
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Jeremy Flint, an MBA graduate and skilled finance writer, excels in content strategy for wealth managers and investment funds. Passionate about simplifying complex market concepts, he focuses on fixed-income investing, alternative investments, economic analysis, and the oil, gas, and utilities sectors. Jeremy’s work can also be found at www.jeremyflint.work.
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The post Solid as a Rock: 3 Blue-Chip Stocks for a Stable Portfolio appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-07
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Whether measured in the short term or over many years, telecom giants Verizon Communications (NYSE: VZ) and AT&T (NYSE: T) have not delivered for shareholders. In this video, Motley Fool contributors Jason Hall and Tyler Crowe make the case for Realty Income (NYSE: O) and One Liberty Properties (NYSE: OLP) as better, likely safer investments, whether you're looking for dividends for today's income or long-term compounding of your wealth.
*Stock prices used were from the morning of Nov. 28, 2023. The video was published on Dec. 6, 2023.
10 stocks we like better than Verizon Communications
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*Stock Advisor returns as of December 4, 2023
Jason Hall has positions in Realty Income. Tyler Crowe has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Realty Income. The Motley Fool recommends Verizon Communications. The Motley Fool has a disclosure policy. Jason Hall is an affiliate of The Motley Fool and may be compensated for promoting its services. If you choose to subscribe through their link they will earn some extra money that supports their channel. Their opinions remain their own and are unaffected by The Motley Fool.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-07
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If you'd rather set yourself up with a hefty stream of passive income than work for a living, there are lots of options. You could write a book and then live off the proceeds, but this requires heaps of effort upfront. You could buy properties and rent them out, but this requires enough effort that we really shouldn't consider such income truly passive.
Whether you have a few million or just a few hundred to invest, sinking your hard-earned money into dividend-paying stocks is probably your most effective option for generating a truly passive income stream.
Of course, picking the right stocks at the right time is a big part of any dividend investing strategy. These three dividend-paying stocks offer high yields upfront at the moment. Plus, there's a good chance the payouts they deliver can keep rising for at least another decade.
Image source: Getty Images.
Altria Group
Shares of the American tobacco giant Altria (NYSE: MO) have fallen about 10% over the past year. At its beaten-down price, the stock offers a huge 9.2% dividend yield.
Investors should know that sales of combustible cigarettes have been in decline for decades. With the leading Marlboro brand in its portfolio, though, Altria's been able to raise its quarterly payout for 54 consecutive years.
Strict government regulations make it nearly impossible for competing tobacco companies to promote competing brands. As a result, Marlboro still boasts a 42% share of the U.S. cigarette market, even though nobody's seen the Marlboro man in decades.
Overall cigarette volumes are down, but Altria has no trouble raising prices on the leading brand. While the volume of cigarettes shipped fell 10.5% in the first nine months of 2023, revenue net of excise taxes is down just 1.4% year over year.
Combustible cigarettes are in decline, but Altria's smoke-free portfolio could drive growth in the years ahead. The company's NJOY brand is the only one approved to market a pod-based e-vapor product.
Realty Income
If you don't like waiting around for dividend raises or dividend payments, consider Realty Income (NYSE: O). At recent prices, the stock offers a 5.6% yield, which is way above average for a legendary dividend program that has grown its payout for 29 consecutive years.
Realty Income is a real estate investment trust (REIT), so it must distribute at least 90% of earnings to shareholders as a dividend. It generates highly reliable cash flows by employing long-term net leases that transfer all the variable costs of building ownership, such as taxes and maintenance, to the renter.
At the end of September, Realty Income boasted a 98.8% occupancy rate across its portfolio of 13,282 properties.
More than three-fourths of Realty Income's portfolio is rented out to retail businesses, but this REIT doesn't sign leases with every retail business that comes calling. Pharmacy, dollar store, and grocery store operators are its largest tenants. These businesses tend to thrive whether the overall economy is booming or in a slump. With a well-positioned portfolio, investors can reasonably expect this stock's payout to rise steadily for at least another decade.
AT&T
Can you remember the last time you changed service providers for your mobile phone? How about your internet service provider? If you're in the U.S., odds are good that at least one of these extremely sticky services is provided to you by AT&T (NYSE: T).
Even if you're not using an AT&T service now, there's a good chance that you will soon. In the third quarter, the company added 468,000 new phone subscribers and 296,000 new fiber-internet subscribers.
In October, AT&T Fiber was available for 20.7 million customers, and the company expects this figure to reach 30 million by the end of 2025.
At recent prices, the telecommunications giant offers a huge 6.5% yield that could climb steadily higher in the decade ahead. Over the past year, AT&T used just 41% of the free cash flow it generated to meet its dividend commitment. This means there's plenty of cash to raise its payout, pay down its sizable debt, and continue growing its business.
10 stocks we like better than Altria Group
When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has tripled the market.*
They just revealed what they believe are the ten best stocks for investors to buy right now... and Altria Group wasn't one of them! That's right -- they think these 10 stocks are even better buys.
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*Stock Advisor returns as of December 4, 2023
Cory Renauer has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Realty Income. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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2023-12-07
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For Immediate Release
Chicago, IL – December 7, 2023 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include: Alphabet Inc. GOOGL, NVIDIA Corp. NVDA, Roche Holding AG RHHBY, Intuit Inc. INTU and AT&T Inc. (T).
Here are highlights from Wednesday’s Analyst Blog:
Top Research Reports Alphabet, NVIDIA and Roche
The Zacks Research Daily presents the best research output of our analyst team. Today's Research Daily features new research reports on 16 major stocks, including Alphabet Inc., NVIDIA Corp. and Roche Holding AG. These research reports have been hand-picked from the roughly 70 reports published by our analyst team today.
You can see all of today’s research reports here >>>
Alphabet shares have outperformed the Zacks Internet - Services industry over the year-to-date period (+48.5% vs. +47.6%). The company’s strong cloud division is aiding substantial revenue growth. Moreover, expanding data centers will continue to bolster its presence in the cloud space.
Further, major updates in its search segment are enhancing the search results. Also, strong focus on innovation of AI techniques and the home automation space should aid business growth in the long term. Further, its deepening focus on the wearables category remains a tailwind.
Alphabet’s expanding presence in the autonomous driving space is contributing well. Its growing efforts to gain a foothold in the healthcare industry are other positives. However, sluggishness in the company’s Network advertisement business remains a headwind. Additionally, its growing litigation issues and increasing expenses are concerns.
(You can read the full research report on Alphabet here >>>)
Shares of NVIDIA have outperformed the Zacks Semiconductor - General industry over the past six months (+24.3% vs. +20.3%). The company’s Compute & Networking revenues are gaining from strong growth of artificial intelligence (AI), high-performance computing and accelerated computing.
The datacenter end-market business is likely to benefit from the growing demand for generative AI and large language models using graphic processing units (GPUs) based on NVIDIA Hopper and Ampere architectures. A surge in Hyperscale demand and a solid uptake of AI-based smart cockpit infotainment solutions are acting as tailwinds.
Collaborations with Mercedes-Benz and Audi are likely to advance its presence in autonomous vehicles and other automotive electronics space. However, its near-term prospects are likely to be hurt by weakening demand for chips used in the professional visualization end-market.
(You can read the full research report on NVIDIA here >>>)
Shares of Roche have underperformed the Zacks Large Cap Pharmaceuticals industry over the past six months (-9.1% vs. +7.0%). The company’s performance has been impacted by lower COVID-19-product-related sales, which has significantly impacted its top line, even though the diagnostics base business and newer drugs maintain growth.
Sales are likely to be affected further by the expected nosedive in sales of COVID-19 products worth nearly CHF 4.5 billion. Competition from biosimilars for established cancer medicines like Avastin, MabThera/Rituxan and Herceptin also hurt sales.
Nevertheless, new drugs, namely Ocrevus, Hemlibra, Evrysdi, Phesgo, Polivy and Tecentriq, have put up a stellar performance. The uptake of the new eye drug, Vabysmo, has been outstanding. The company’s efforts to develop new drugs to combat the decline in legacy drugs are encouraging.
(You can read the full research report on Roche here >>>)
Other noteworthy reports we are featuring today include Intuit Inc. and AT&T Inc.
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2023-12-06
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
Discerning investors seek stable yet promising income options to bolster their portfolios in the investment landscape. Delving into the strategies of the listed companies in the article reveals intriguing insights into their strategic prowess and financial fortitude. These are our top dividend stocks to buy.
As technology advances, two leading telecom giants strategically position themselves with 5G innovations, evident in their revenue surges and market dominance. Meanwhile, a real estate stalwart showcases an impressive portfolio expansion strategy and financial resilience, enhancing its attractiveness to investors.
The spotlight on the first one on the list reveals a deliberate focus on 5G and fiber technology, translating into revenue upticks and solidifying its position in the market. Through astute financial management and market segmentation, the second demonstrates robust growth in wireless services and a disciplined approach to capital allocation. The third one, with its strategic acquisitions and merger synergies, presents a compelling case for sustained growth and investor confidence in the real estate domain.
Read more to dive into strategic cues from these dividend titans, guiding investors toward potentially prosperous ventures in the ever-dynamic market landscape.
Top Dividend Stocks to Buy: AT&T (T)
Source: Lester Balajadia / Shutterstock.com
AT&T (NYSE:T) is offering a dividend yield of 6.45%, and it strategically focuses on investments in 5G and fiber technology, which have yielded tangible results. For instance, a 1% increase in consolidated revenues will be driven primarily by wireless service and fiber revenue growth in Q3 2023. The company’s focus on advancing these next-generation technologies positions it for sustained growth.
To begin with, the wireless segment has been a significant driver of growth. It showcases impressive figures such as 468K postpaid phone net adds and a 2% revenue increase. AT&T has a consistent approach to catering to high-value subscribers through competitive deals and network quality. Hence, this has led to notable outcomes, including increased customer retention, higher average revenue per user (ARPU), and minimal churn rates.
On the other hand, AT&T’s focus on expanding its fiber network has resulted in steady growth. As a result, 296K fiber customers were added in Q3, and an approximate 9% increase in fiber ARPU year-over-year. The fiber investments signify AT&T’s lead in addressing consumer preferences for high-speed internet solutions. The company focuses on offering superior broadband services that have fueled customer acquisition. Thus, it boosted revenue streams and significantly increased ARPU, showcasing a robust market demand for such services.
Lastly, AT&T’s emphasis on operational efficiency, cost-saving initiatives, and margin improvements has positively impacted financial performance. AT&T focuses on generating incremental cost savings and aligning operations with the evolving 5G and fiber networks. Finally, the company reduced its net debt by more $3 billion in Q3. It remains on track to achieve its adjusted EBITDA target.
Verizon (VZ)
Source: Ken Wolter / Shutterstock.com
Verizon (NYSE:VZ) provides a dividend yield of 6.92%, showcasing robust growth in key financial metrics. For instance, in Q3 2023, there was a 2.9% year-over-year increase in wireless service revenue and an adjusted EBITDA of $12.2 billion, surpassing previous quarters. The growth underscores the effectiveness of Verizon’s strategic initiatives, emphasizing expanded customer relationships and disciplined financial management.
Moreover, the year-to-date free cash flow of $14.6 billion exceeds the 2022 full-year cash flow. This highlights Verizon’s efficient cash generation capabilities, driving confidence in its dividend stability and value growth potential.
Additionally, Verizon’s net debt reduction focuses on maintaining healthy dividend coverage. The prudent financial management strategies indicate its dedication to enhancing shareholder value while ensuring sustainable dividend growth. Thus, the company has a healthy free cash flow dividend payout ratio of approximately 56%. Hence, this suggests improved financial health and disciplined capital allocation, supporting growth initiatives.
Furthermore, Verizon’s solid leads in the consumer mobility segment stem from its segmented market approach, prioritizing customer choice and flexibility. As a result, there is a growth in postpaid phone net ads and reduced promotional costs. Similarly, in the business domain, Verizon Business Group has consistent growth in postpaid phone net adds, 151K in Q3, with a ninth consecutive quarter above 125K. This illustrates its adeptness in addressing distinct market segments while maintaining profitability, a critical factor in sustaining long-term growth.
Verizon’s focus on operational efficiency is reflected in its emphasis on profitability while optimizing network infrastructure. The company’s cost-efficiency program is on track to meet savings goals ($2 billion to $3 billion annually by 2025). This highlights its ability to generate operational efficiencies across various business domains. Finally, the raised 2023 free cash flow guidance of more $18 billion demonstrates Verizon’s confidence in sustaining robust financial performance and operational growth. This one easily earned its spot on our list of the top dividend stocks to buy.
Realty Income (O)
Source: Shutterstock
Realty Income (NYSE:O) is offering a 5.59% yield, and its strategic prowess in investment deployment is evident through the quarter’s $2 billion investment in high-quality acquisitions. The substantial investments, particularly the $1.4 billion derived from international business, will yield a 6.9% yield in Q3 2023.
Diverse transaction types, such as sale-leaseback deals and larger transactions, are also included, underscoring the company’s flexibility and capability to navigate less conventional investment avenues. Therefore, Realty Income has a distinct competitive advantage in identifying and executing transactions that might not be as prevalent among other net lease companies.
Additionally, the impressive rent recapture rates of 106.9% on new and renewed leases underline Realty Income’s negotiation strength. Also, it highlights the company’s capability to secure favorable terms with tenants. Notably, a same-store rent growth of 2.2% surpassed expectations. It also led to an upward revision of full-year guidance to around 1.5%. Fundamentally, the company’s emphasis on leases with robust rent escalators has proven to be a strategic advantage in driving higher average rent escalators.
Despite challenging capital market conditions, Realty Income delivered a solid performance. The company had a 4.1% growth in Adjusted Funds From Operations (AFFO) per share and an annualized total operational return of approximately 9%. The growth, coupled with the announced merger agreement with Spirit Realty (NYSE:SRC), valued at $9.3 billion, is anticipated to boost AFFO per share immediately. Overall, the anticipated synergies from the merger emphasize the company’s vision to augment AFFO per share growth. It will also allow the company to access capital markets more efficiently. If you are looking for dividend stocks to buy, start here.
As of this writing, Yiannis Zourmpanos held long positions in T and VZ. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Yiannis Zourmpanos is the founder of Yiazou Capital Research, a stock-market research platform designed to elevate the due diligence process through in-depth business analysis.
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2023-12-06
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InvestorPlace - Stock Market News, Stock Advice & Trading Tips
As investors, we always strive to build a well-balanced portfolio that can provide stability through various economic cycles. While high-flying growth stocks generate all the hype these days (and deservedly so), defensive dividend stocks remain essential to provide a steady stream of income, as well as stability. That’s particularly true when markets become volatile. And let’s face it, with inflation proving stickier than hoped and various global tensions simmering, we could see increased volatility ahead.
But this doesn’t have to derail our portfolios if we hold the right mix of stocks. Even in turbulent times, plenty of stalwart, cash-rich companies with established track records have kept increasing their dividends year after year. I’m talking about the Dividend Aristocrats, and other S-tier stocks that represent some of the most reliable long-term holds out there. These are the types of stocks you can confidently buy and forget about, all while your dividend distributions roll in.
I’ll highlight seven generous dividend stocks perfectly suited for building a lifetime of passive income. Additionally, I’ll explore some lesser-known names throwing off juicy yields and a few dividend stalwarts you likely already know. This also includes some undervalued dividend stocks you can snap up for a bargain after their selloffs. Let’s start!
Public Storage (PSA)
Source: Ken Wolter / Shutterstock.com
At first glance, Public Storage (NYSE:PSA) may appear like a risky option in the world of real estate investment trusts (REITs). However, this self-storage stalwart operates with far less volatility than most commercial or residential real estate funds. Demand for storage has grown steadily amid a booming U.S. economy and population growth. Physical storage needs will only intensify in the coming decades as more blue-collar sectors thrive.
Public Storage is perfectly positioned to capitalize as a leading storage provider. Shares have declined 40% from their peak, creating substantial upside from the stock’s current $269 price tag. The company’s generous 4.5% dividend yield also leaves income potential. Payouts should continue rising, given impressive profitability and growth trends. Thus, Public Storage represents a relatively safe, growing business that is undeserving of its selloff. The predictable nature of self-storage stands out against a turbulent real estate backdrop. Steady demand and pricing power should continue driving predictable cash flows. Therefore, the bottom appears to be in for this dividend stalwart.
Innovative Industrial Properties (IIPR)
Source: gvictoria / Shutterstock.com
Like Public Storage, Innovative Industrial Properties’ (NYSE:IIPR) cannabis-linked real estate focus makes it appear riskier than typical REITs. However, leasing industrial space to pot growers somewhat insulates IIPR from traditional property market swings. Highly volatile cannabis stocks dominate the headlines, but IIPR’s indirect approach looks opportunistic after its 75% plunge.
The REIT’s jaw-dropping yield says markets expect tenants to miss rent payments. But the trust’s substantial collection rate and rising payouts signal otherwise. While challenges exist industrywide, top multi-state operators seem to be on solid enough ground to easily cover rent. Preferred access to specialized growing facilities also gives tenants a major incentive to pay IIPR before other expenses.
Ultimately, fears around this stock appear to be overblown, given reasonable rent coverage ratios for most tenants. Providing an 8.25% yield effectively compensates investors for the risk they’re taking. Accordingly, from my perspective, this stock’s return profile looks very attractive for long-term, income-focused investors.
AT&T (T)
Source: Shutterstock
AT&T (NYSE:T) seems poised for a long-awaited breakout after years of declines. While the telecom giant has constantly frustrated shareholders with drama and distractions, improving wireless and fiber trends signal a coming wave of growth and value creation. Trading at less than 7-times earnings, I believe T stock pricing largely reflects the negatives rather than enormous untapped potential.
The company’s generous 6.5% dividend yield adds stability for patient investors until catalysts gain traction. AT&T continues expanding its next-generation 5G and fiber networks to meet surging data demand. As those capital-intensive investments moderate, cash generation may explode higher. The company also expects to achieve $2 billion in cost savings within three years.
I believe AT&T makes for an ideal recovery and turnaround candidate at current levels. Management aims to pay down debt and return excess cash to shareholders once it hits target leverage ratios. With wireless competition easing and years of underperformance baked in, this telecom titan is positioned to deliver sustained capital appreciation alongside a rock-solid dividend.
Watsco (WSO)
Source: Casimiro PT / Shutterstock.com
Watsco’s (NYSE:WSO) modest 2.5% dividend yield seems relatively low at first glance. However, in my view, the stock remains a compelling buy based on its standout capital appreciation potential. Watsco has emerged as one of the strongest performers across the entire market, with WSO stock surging 55% this year. Strength is owed partly to the record summer heat, which drove demand for air conditioning products.
Looking ahead, climate change trends point towards sustaining tailwinds regardless of one’s views. Analysts also forecast healthy, accelerating long-term growth for Watsco’s niche AC distribution business. Thus, I believe the company’s modest starting yield could grow into a significant income stream when combined with an ongoing upside in stock prices. Of course, risks exist, but WSO seems poised to continue capitalizing on natural tailwinds from rising temperatures.
Watsco’s dividend growth and stock appreciation potential make it well worth holding for the long-run.
AbbVie (ABBV)
Source: Piotr Swat / Shutterstock.com
As one of the pharmaceutical sector’s largest players, AbbVie (NYSE:ABBV) provides immense dividend reliability. Unlike more speculative names listed here, this stock prioritizes dividends over capital gains. After all, few industries boast cash flow consistency comparable to biopharma companies with diverse drug portfolios. Even with the U.S. Humira patent expiration in play, AbbVie has only strengthened its cash generation capabilities.
With its high 4.3% forward yield and Dividend King status, AbbVie seems poised to deliver years of payout growth ahead. Healthcare tends to endure recessions better than other sectors as well. Therefore, while the upside appears limited, I believe AbbVie remains a low-volatility, high-yield pick suitable for nearly any dividend-focused portfolio. AbbVie looks like an ideal pick for income and stability. The days of sky-high growth may have passed, but strong and growing dividends seem highly sustainable for long-term investors.
Enterprise Products Partners (EPD)
Source: Casimiro PT / Shutterstock.com
No energy stock provides immunity from oil and gas volatility, as recent years have repeatedly proven. Nonetheless, Enterprise Products Partners (NYSE:EPD) is slowly recovering to pre-pandemic valuation levels. Enterprise Products has delivered slow but steady share price progress since initial 2020 lows. And with revenue basically doubling from 2020 to 2022, the company’s operating business shows momentum that looks sustainable as well. Despite a projected 2023 revenue pullback, analysts’ models see top-line growth resuming in 2024 and beyond as higher oil prices persist.
EPD stock features a 7.5% dividend yield, which also leads its midstream peer group. With 26 consecutive annual payout hikes, the company clearly prioritizes dividend distributions through ups and downs. Ultimately, Enterprise Products’ combination of cash flow consistency, yield magnitude, and conservative operations warrant income investor consideration. In my view, Enterprise Products Partners remains a rock-solid midstream pick as energy markets stabilize.
Tyson Foods (TSN)
Source: rblfmr / Shutterstock.com
Like many food producers, Tyson Foods (NYSE:TSN) has battled agricultural commodity volatility in recent years. Following a surge in meat and poultry prices, the company now contends with falling prices and resulting profit pressures. However, with shares having priced in the deceleration of earnings, Tyson seems poised to provide some nice upside as demand recovers.
The company’s valuation also looks highly attractive, with Tyson’s forward price-earnings ratio sitting below 12-times. Tyson also pays 4% dividend yield after 12 consecutive annual hikes, providing income as investors wait. So, while macro uncertainty lingers, I believe the stock’s risk/reward profile skews positively for long-term investors right now. Tyson boasts a diversified protein portfolio, economies of scale, and agora-food demand tailwinds that should ultimately drive a rebound over time.
On the date of publication, Omor Ibne Ehsan did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
Omor Ibne Ehsan is a writer at InvestorPlace. He is a self-taught investor with a focus on growth and cyclical stocks that have strong fundamentals, value, and long-term potential. He also has an interest in high-risk, high-reward investments such as cryptocurrencies and penny stocks. You can follow him on LinkedIn.
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The post 7 High-Dividend Stocks to Buy for a Lifetime of Passive Income appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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The J. M. Smucker Company (SJM) shares jumped 3.3% after the company reported second-quarter earnings of 2.59 per share, beating the Zacks Consensus Estimate of $2.47 per share.
Signet Jewelers Limited (SIG) shares gained 5.9% after the company reported third-quarter earnings of 0.24 per share, beating the Zacks Consensus Estimate of $0.15 per share.
AutoZone, Inc. (AZO) shares rose 0.3% after the company reported first-quarter earnings of 32.55 per share, beating the Zacks Consensus Estimate of $31.01 per share.
Shares of Telefonaktiebolaget LM Ericsson (publ) (ERIC) shares surged by 4% following the announcement of the five-year deal with AT&T Inc. (T).
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One little-known company is at the heart of an especially brilliant Artificial Intelligence sector. By 2030, the AI industry is predicted to have an internet and iPhone-scale economic impact of $15.7 Trillion.
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