Insiders and Wall Street Heavyweights Jumping on 4 Battered Large Caps
This company has bounced off the lows, but is still down from highs printed in January. AT&T Inc. (NYSE: T) is the world’s largest provider of pay TV, with TV customers in the United States and 11 Latin American countries. In the United States, the AT&T wireless network has the nation’s self-described strongest 4G LTE signal and most reliable 4G LTE. The company also helps businesses worldwide serve their customers better with mobility and highly secure cloud solutions.
With its shares trading at a very cheap 12.8 times estimated 2018 earnings, the company continues to expand its user base, and strong product introductions from smartphone vendors have not only driven traffic but increased device financing plans.
AT&T has several major catalysts that will likely drive strong network traffic demand: DirecTV Now and Mobile, “Data-Free TV” for DirecTV/U-verse subscribers, and increasing penetration of unlimited data plans. Many on Wall Street believe that the company is well-positioned to address ongoing traffic requirements, with additional LTE capacity available and the ability to leverage small cell deployments.
The company posted solid numbers for the third quarter, but between concerns over the Time Warner deal risk and the overhang from the arbitrage accounts, the stock has been in a funk. However, several large investors have recently made changes to their positions and institutional investors now own 55.21% of the company’s stock. An AT&T director recently bought 92,243 shares of the stock for a whopping $3.5 million.
AT&T investors receive a 5.65% dividend. Jefferies has a Buy rating on the shares and a big $48 price target. The consensus target is $39.68, and shares closed on Monday at $34.68.
The on-again, off-again merger with T-Mobile appears to be off-again, and the shares have been crushed once more. Sprint Corp. (NYSE: S) provides various wireless and wireline communications products and services to consumers, businesses, government subscribers and resellers in the United States, Puerto Rico and the U.S. Virgin Islands.
The company operates in two segments. The Wireless segment offers wireless data communication services, including mobile productivity applications, such as internet access, messaging and email services; wireless photo and video offerings; location-based capabilities comprising asset and fleet management, dispatch services and navigation tools; and mobile entertainment applications.
The Wireline segment provides wireline voice and data communications, including domestic and international data communications using various protocols, such as multiprotocol label switching technologies, internet protocol (IP), managed network services, voice over IP, session initiated protocol and traditional voice services to other communications companies and targeted business subscribers.
Softbank, which remains the largest shareholder of the company, continues to add shares, picking up the buying momentum once again as the reported merger deal fell through. The company recently bought an additional 3.2 million shares at prices that ranged from $5.99 to $6.18 for a total of $19.6 million.
The consensus price target of $7.28 compares with Monday’s closing price of $6.15 a share.
Whether any of these beaten down stocks are right for a portfolio depends entirely on one’s risk tolerance. One thing is for sure though: the low prices make them tempting for any investors with a long enough timeline to see if they don’t bounce off these extremely low levels.