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Thursday morning AT&T (T) announced that second-quarter diluted earnings totaled 68 cents per share. The results were 14 cents better than the same quarter a year ago. Taking a one-time gain of seven cents out of the equation (stemming from a stock transaction), AT&T still managed to top the consensus estimate of 57 cents per share. The company also reported that it topped 90 million connections for the first time during the quarter, driven by a record 3.2 million iPhone accounts activated (a company record). The activations weren't solely driven by the iPhone, as 1.6 million other wireless connections were added (a second-quarter record). All in all, it was a solid quarter for AT&T.
The company didn't stop with a solid earnings report, as the telecommunications titan turned an eye to the rest of 2010 -- stating that it expects "strong earnings per share growth." AT&T also expects higher free cash flow compared to last year. Previously, the firm expected stable-to-improved earnings per share with free cash flow remaining flat.
Technically, the company faces a fair share of overhead resistance (you can see a chart for AT&T here). The stock is currently battling resistance from the $25 level. This level acted as support in the past, which could bolster the level's resistive powers. Should the stock rally past this level, the $26 level lurks overhead as well -- and the $27 level beyond that. Was this earnings report good news for AT&T? Yes. Will the report help the stock topple the various layers of overhead resistance? Perhaps, but the road higher will be tough.
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Reader Comments (Page 1 of 1)
7-22-2010 @ 9:31AM
Rolf Gatlin said...
Mark, I would just clarify that that the 3.2 million iPhone activations should be considered separate from the 1.6 million net adds. The iPhone activations are based on a gross number.
Let me know if you need further clarification.