June 28, 2016

Warren Buffett Sold His Position In AT&T. Should You?


Warren Buffett sold AT&T (T) out of Berkshire Hathaway’s portfolio of high-yield dividend stocks during the first quarter of 2016.

Warren Buffett acquired his stake in AT&T during the third quarter of 2015 as a result of AT&T’s acquisition of DirecTV.

Buffett had owned DirecTV prior to the acquisition (his first purchase was in 2011), so his shares converted into AT&T stock once the deal closed because the acquisition was a stock and cash transaction.

Despite AT&T’s high dividend yield near 5% and seemingly cheap price-to-earnings multiple (14.2), Warren Buffett apparently thought there were more attractive options to put his money to work.

Like Warren Buffett, we prefer Verizon (VZ), which is held in Berkshire Hathaway’s portfolio as well as our Conservative Retirees dividend portfolio.

Let’s take a closer look at the safety and growth potential of AT&T’s dividend as well as the company’s overall appeal as a potential investment opportunity for dividend investors.



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