AT&T (T): For low risk and high yield

Posted Feb 21st 2008 11:15AM by Steven Halpern
Filed under: Newsletters, AT and T (T), Stocks to Buy

"Given the uncertainties, our strategy now is to focus on stocks with minimal downside risk in a weak economy, says Harry Domash who has added AT&T (NYSE: T) to the portfolio of his Winning Investing.

"Telecom giant AT&T is in a recession resistant businesses and pays a high dividend, which are the characteristics we need for this market. The stock provides and estimated dividend yield of 4.2%

"SBC Communications adopted the AT&T name when it bought long distance carrier AT&T in 2005. AT&T purchased BellSouth in 2006 and now provides landline Internet and telephone services in 22 U.S. states.

"With BellSouth, AT&T gained full control of Cingular, the largest wireless carrier in the U.S., and changed its name to AT&T Mobility. Wireless services account for most of AT&T's growth. Last year AT&T became the exclusive service provider for Apple's new iPhone.

"In 2006, AT&T launched a fiber-based network, called 'U-verse,' which offers video and higher speed Internet services.

"AT&T reported December quarter (continuing) earnings of $0.71 per share, up 16% vs. year-ago. Thanks to its BellSouth purchase, revenues rose 91% to $30.3 billion. The stock is an addition to the 'Masstress Stuffers' portion of our model portfolio."

Each day, Steven Halpern's TheStockAdvisors.com offers the latest market commentary and favorite investment ideas from the nation's leading financial newsletter advisors.

Tags: at and t, AtAndT, t

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Reader Comments (Page 1 of 1)

2-22-2008 @ 11:36AM

Greg said...

Please help me understand how a stock like AT&T can decline from a high of $42 per share to $34 per share in less than two months and you consider it a "low risk?" This thing is headed for $28 per share within the next couple of weeks. You might want to reconsider your pick.

3-17-2008 @ 5:17AM

Rob Best said...

Greg - I think you're question is looking to the short term, whereas this post looks more to the long term. AT&T are only going one way in the medium- to long-term, and that is up. They're trading at $35 as I write, and the 52-week range is $33 -$43. So it's still close to the bottom of it's trading range which, for me, makes it a good buy.

That said, no one can accurately and consistently predict the direction a stock will take, so I use a buy-write / covered call strategy on all holdings.

http://www.maverick-investor.com