Summary
- Quantitative analysis of AT&T shares using the power of free cash flow.
- Analysis of AT&T from a Main Street vs. Wall Street perspective.
- Shows the reader how to do a similar analysis on their own portfolio holdings.
- I do much more than just articles at Friedrich Global Research: Members get access to model portfolios, regular updates, a chat room, and more. Get started today »
On Dec. 13, 2019, Seeking Alpha News Editor Yoel Minkoff reported the following: AT&T launches consumer 5G in 10 cities. AT&T (NYSE:T) has switched on its 5G service in 10 markets, including Los Angeles, San Diego and Pittsburgh as it begins selling the Samsung (OTC:SSNLF) Galaxy Note10+ to take advantage of the new network.
For those unfamiliar with 5G, here's a wonderful explanation of what it is from the tech website searchnetworking.techtarget.com.
“Fifth-generation wireless (5G) is the latest iteration of cellular technology, engineered to greatly increase the speed and responsiveness of wireless networks. With 5G, data transmitted over wireless broadband connections could travel at rates as high as 20 Gbps by some estimates - exceeding wireline network speeds - as well as offer latency of 1 ms or lower for uses that require real-time feedback. 5G will also enable a sharp increase in the amount of data transmitted over wireless systems due to more available bandwidth and advanced antenna technology. 5G networks and services will be deployed in stages over the next several years to accommodate the increasing reliance on mobile and internet-enabled devices. Overall, 5G is expected to generate a variety of new applications, uses and business cases as the technology is rolled out.”
Many investors have been waiting patiently for 5G to be rolled out as the technology promises to be a huge jump forward in how fast the Internet can operate. In this article, I will not discuss AT&T’s 5G rollout or how each of the company’s divisions are doing, as you can read dozens of such articles on Seeking Alpha, both pro and con. What I will simply do is a quantitative analysis of AT&T's results on Main Street and then relate them to what an investor should do on Wall Street, using zero emotion. I will be doing so using my Friedrich Algorithm, which does a complete analysis of a company’s balance sheet, income statement and cash flow statement over a 10-year period and generates what we call a final “Main Street” price, or what we believe the company is worth on Main Street per share. We then compare the market price or “Wall Street” price to it and try to find either an oversold or bargain situation where the Wall Street price is significantly lower than its Main Street price and can thus be considered a “Bargain.” We do this for some 20,000 companies from 35 countries. Thus, without further ado let us begin our analysis of AT&T.
