On Friday, Citi expressed continued confidence in AT&T (NYSE:T), maintaining a Buy rating and a $20.00 stock price target for the telecommunications giant. The firm's optimism is based on anticipated solid performance in the second quarter of 2024, despite adjustments to some growth estimates.
AT&T is expected to slightly exceed consensus EBITDA predictions, driven by strong mobility results and consistent growth in the consumer wireline segment. These positive outcomes are seen as countering the challenges faced within the business segment. The company's management has consistently communicated about strategic volume dynamics for wireless postpaid phones and fiber net additions.
Citi has adjusted its expectations for AT&T's fiber broadband additions, reducing the forecast from 250,000 to 230,000 for the second quarter. This revised estimate now falls below the Visible Alpha consensus of 257,000. The change in forecast is attributed to the seasonality of fiber broadband, a factor that was not initially included in the firm's analysis.
Despite the lowered estimate for fiber net adds, AT&T is anticipated to reaffirm its full-year guidance and its objectives for 2025. Citi's report underscores its view of AT&T shares as the top pick in their category, signaling strong prospects for the company's performance and stock value.
In other recent news, AT&T CEO John Stankey recently shared insights into the company's multiyear growth strategy at the J.P. Morgan Global Technology, Media and Communications Conference.
The telecom giant is focusing on the expansion of its 5G and fiber networks and is on track to meet its financial guidance for the year. AT&T anticipates achieving over $2 billion in run-rate cost savings by mid-2026 and is working towards a net-debt to adjusted EBITDA ratio in the 2.5x range in the first half of 2025.
In other developments, AT&T, along with other major telecommunications companies, is challenging the reinstatement of net neutrality rules by the Biden administration. These companies have filed legal actions in multiple U.S. circuit courts, arguing that the Federal Communications Commission is overstepping its authority.
On a different note, Congressman Mike Kelly and Congresswoman Carol Devine Miller have made significant transactions involving AT&T shares. Kelly sold his AT&T shares, while Miller sold shares in AT&T and other major companies.
Lastly, the Federal Communications Commission has fined AT&T $57 million for unauthorized sharing of customers' location information, a breach of customer privacy. These recent developments reflect the dynamic and evolving nature of AT&T's operations and its interactions with regulatory bodies.
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