AT&T Falls 3.5% as J.P. Morgan Downgrades Stock

On Tuesday, AT&T (NYSE:T) stock fell 3.6% and closed at $29.15. At the closing price, the company’s market cap was $209.1 billion. The Dow Jones Industrial Average and the S&P 500 Index have also been trending downward since the coronavirus outbreak. Read Can US Stock Markets Rise in Q2 after Q1 Crash? and Will the Dow Jones Crash Create a Double Bottom? to learn more.

As of Tuesday, AT&T stock was trading 26.6% below its 52-week high of $39.70 and 11.8% above its 52-week low of $26.08. On a YTD (year-to-date) basis, the stock has lost 25.4% as of Tuesday. The stock price has risen 3.8% in the trailing five-day period, while it has fallen 7.1% in the trailing 12-month period.

AT&T stock downgraded

AT&T stock got a jolt today. At 11:22 AM ET, the stock was trading 3.5% lower at $28.19. The stock also fell in the pre-market session. J.P. Morgan analyst Philip Cusick downgraded the stock to “neutral” from “overweight” due to the coronavirus outbreak. The analyst also cut its target price on the stock from $38 to $35. According to a report from TheFly, “While the analyst still believes AT&T’s 7.2% dividend yield will continue to be paid, he sees issues that will keep pressure on the stock in the near to medium term amid the COVID-19 crisis. These include further downside to results in media as social distancing policies extend and the potential for small to mid-sized business weakness increases.”

The report also said, “Further, part of the AT&T story had been asset sales to de-lever, which seem less likely in today’s market…And with weaker EBITDA there are likely to be no more buybacks this year and potentially next year as well.”

In March, an Instinet analyst cut its target price on AT&T stock from $44 to $39, while Citigroup reduced it from $42 to $31. Cowen and Company downgraded the stock to “market perform” from “outperform” with a target price of $37.

Stock performance

On Tuesday, AT&T stock was trading 8.1% below its 20-day moving average of $31.72. Meanwhile, the stock is trading 17.6% below its 50-day moving average of $35.38 and 21.1% below its 100-day moving average of $36.94. AT&T’s 14-day RSI (relative strength index) score is 40. The RSI indicates that the stock isn’t “overbought” or “oversold.”

On Tuesday, AT&T stock closed near its middle Bollinger Band level of $32.22. The value suggests that the stock isn’t “oversold” or “overbought.” AT&T’s 14-day MACD is -1.05, which also indicates that the stock is on a downward trading trend.

Among the 32 analysts that follow AT&T, ten recommend a “buy,” 20 recommend a “hold,” and two recommend a “sell.” As of Tuesday, analysts’ consensus target price is $37.66, which implies a 12-month return potential of 29%.

On Tuesday, T-Mobile (NYSE:TMUS) stock rose 0.9% and closed the trading day at $83.90. T-Mobile has an average broker target price of $100.10. The figure suggests a return of 19% over the next 12 months. Today, T-Mobile announced that it closed the merger agreement with Sprint. Read T-Mobile Stock Gains after Closing Sprint Merger Deal to learn more.

To learn more about AT&T, read AT&T Stock Is a ‘Buy’ amid the Coronavirus Sell-Off and AT&T Withdraws Share Buyback Plan amid Coronavirus. You can also read AT&T’s Management Is Confident amid Market Turmoil.