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AT&T: Analyzing Its Key Technicals and Target Prices

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On Monday, AT&T (T) closed at $33.49, which was 2.0% lower than its previous closing price, 3.3% lower than its 52-week high of $34.64, and 25.0% higher than its 52-week low of $26.80. The company’s market cap is $244.4 billion.

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AT&T’s stock returns

Based on AT&T’s closing price on Monday, the company has reported returns of -2.5% in the last five trading days, -2.4% in the trailing one-month period, and 3.8% in the trailing 12-month period. The company has reported returns of 17.3% since the beginning of 2019. While AT&T’s stock performance has been impressive this year, the stock has fallen 20.8% in the last three years and 0.9% in the past five years.

AT&T stock has a forward PE ratio of 9.36x for 2019 and 9.17x for 2020. The stock has an expected 1.7% adjusted EPS increase in 2019. As a result, we think that the stock is overvalued.

AT&T’s technical levels

Based on the closing price on Monday, AT&T stock was trading 0.1% below its 20-day moving average of $33.53, 1.8% above its 50-day moving average of $32.90, and 4.3% above its 100-day moving average of $32.12. On the downside, the company’s immediate key support lies near $33.14, while $33.89 could act as an immediate key resistance level on a daily basis.

The company’s 14-day RSI (relative strength index) was 61, which means investors are neutral towards the stock.

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Analysts’ recommendations

According to analysts’ consensus, AT&T stock has a mean target price of $34.42 and a current market price of $33.49, which suggests an upside potential of 2.8% in the next 12 months. The median target price was $35.00 on Monday. Among the 28 analysts tracking AT&T, 15 recommended a “buy,” 12 recommended a “hold,” and one recommended a “sell.”

Financial performance

In the second quarter, AT&T reported consolidated revenues of $45.0 billion—a rise of 15.3% YoY (year-over-year) and $105 million above the consensus estimate. The company reported a consolidated adjusted EBITDA of $15.0 billion—a rise of 13%.

AT&T also reported an adjusted EPS of $0.89—a fall of 2.2% and in line with the consensus estimate. Read What Went Wrong with AT&T’s Q2 Earnings? to learn more.

Analysts expect AT&T’s net revenues to see YoY changes of -0.73% to $45.40 billion in the third quarter and -0.70% to $47.66 billion in the fourth quarter. Analysts also expect the company’s adjusted EPS to see YoY changes of 3.3% to $0.93 in the third quarter and 3.5% to $0.89 in the fourth quarter.

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