Summary
- Earlier, I argued the AT&T seems to be searching for a business model that would make it competitive in this era of the "new" Modern Corporation, yet not finding it.
- The recently announced ideas for the streaming services package of WarnerMedia just seem to highlight the fact that management doesn't have a firm idea about what lies ahead.
- Given this picture, it is hard to see AT&T performing up to its old standards, and its lagging stock price indicates that investors seem to be doubtful as well.
A little over a month ago, I wrote a post claiming that AT&T, Inc. (NYSE: T) was having trouble finding its identity in this era of Big Tech.
"AT&T seems to be going through an identity crisis and this fact is not helping its stock price at all," I wrote.
And, this search did not seem to be helping the company's performance. From 2012 through 2015, AT&T posted a return on shareholders' equity of just around 15.0 percent. In the first quarter of 2019, the return dropped to 11.9 percent. And, remember, this performance was enhanced by the company's use of financial leverage.
Over the past couple of years, the management of AT&T has upped its efforts to find a new identity, one more associated with the emerging role of information technology in the emerging era.
But, I wrote, "AT&T seems to be having trouble, as some of the areas it appears to be focusing upon are, in fact, losing customers."
