As part of our ongoing series here at The Acquirer’s Multiple, each week we focus on one of the stocks from our Stock Screeners, and why it’s a ‘buy’ based on key fundamentals.
One of the cheapest stocks in our Stock Screeners is:
AT&T Inc (T)
The wireless business contributes nearly 70% of AT&T’s revenue. The firm is the third-largest US wireless carrier, connecting 72 million postpaid and 17 million prepaid phone customers. Fixed-line enterprise services, which account for about 16% of revenue, include internet access, private networking, security, voice, and wholesale network capacity. Residential fixed-line services, about 11% of revenue, primarily consist of broadband internet access, serving 14 million customers. AT&T also has a sizable presence in Mexico, with 23 million customers, but this business only accounts for 4% of revenue. The firm still holds a 70% equity stake in satellite television provider DirecTV but does not consolidate this business in its financial statements.
A quick look at the share price history (below) over the past twelve months shows that the price is up 50.85%. Here’s why the company is undervalued.
Source: Google Finance
Key Stats
Market Cap: $158.7 Billion
Enterprise Value: $319.31 Billion
Operating Earnings
Operating Earnings: $24.69 Billion
Acquirer’s Multiple
Acquirer’s Multiple: 12.90
Free Cash Flow (TTM)
Free Cash Flow: $20.99 Billion
FCF/MC Yield %:
FCF/MC Yield: 13.23
Shareholder Yield %:
Shareholder Yield: 5.30
Other Indicators
Piotroski F Score: 8.00
Div Yield %: 5.20
ROA (5 Year Avge%): 6
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