It’s up to investors to decide if AT&T's big yield and low appreciation are something they want
Shares of AT&T Inc. (NYSE:T) are under pressure, down
more than 13% over the past month and 21% this year. With T stock now trading
at its lowest levels since 2015, is it time to get in or wave the white flag?
A more positive spin? Its dividend yield — 5.86% — is at its
highest level since 2012. While some may see that as a negative, it’s hard to
hate a big, dependable payout.
The Case Against T Stock
A few arguments can be made against T stock, the first being
its lack of capital appreciation. Over the last five years, shares are down
4.3%; over the last 10, T stock has lost more than 17%. Obviously that’s not
attractive. However, when including the dividend, the returns jump to a
positive 29% and 45%, respectively. No, it’s not Apple Inc. (NASDAQ:AAPL), but
T isn’t BlackBerry Ltd (NYSE:BB), either.
What’s also not attractive? The fact that, thanks to Verizon
Communications Inc. (NYSE:VZ), T-Mobile US Inc (NASDAQ:TMUS) and Sprint Corp
(NYSE:S), the wireless competition is fierce. Constantly increasing demand for
more data is forcing wireless carriers to constantly upgrade their equipment to
service this high demand. Will the customer ever tone down their demands? Not
likely.
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