AT&T (T) Q1 Wireless Business 'Impressive', Says Wells Fargo
- Market Wrap: Shire Makes Bid for Baxalta, Gets Rejected; Fed's Lockhart Hints at Sept. Rate Hike; Splitsville for RR Donnelley
- Disney (DIS) Tops Q3 EPS by 3c
- China Worries, Technical Damage Weigh on Apple (AAPL)
- Activision Blizzard (ATVI) Tops Q2 EPS by 5c, Revenue Beats, Offers Guidance
- After-Hours Stock Movers 08/04: (USNA) (CHUY) (Z) Higher; (ETSY) (TRMB) (GLUU) (DIS) Lower (more...)
Wells Fargo maintained an Outperform rating on AT&T (NYSE: T) with a price target of $42-$44. Analyst Jennifer M. Fritzsche commented on Q1, calling wireless subs impressive.
'T reported solid Q1'14 results characterized by better-than-expected wireless results - most notably in net adds and churn. As to be expected, the company's EIP plan, Next and economics around it were a major focus of the quarterly print. T offered new guidance which includes the impact from LEAP acquisition. We believe T's 2014 guidance is quite achievable based on strong Q1 performance metrics. We are adjusting our estimates. Specifically, FY2014E revenue and EPS are $133.2B and $2.73 vs. $131.5B and $2.67 prior. Our FY2015E are $134.8B and $2.88 vs. $134.0B and $2.79 prior," said Fritzsche.
"WIRELESS – BIG TIME SOLID - Q1 wireless revenue, EBITDA and EBITDA margin were $17.9B, $7.0B and 45.4% vs. our estimates of $17.4B, $6.9B and 44.2%, respectively. The company added 625K postpay net adds, well above our 180K estimate and Street consensus of 212K. Over 1.1MM new postpay smartphones were added (upgrades and new subs), and smartphones accounted for 92% of postpay phone sales. Postpay churn was 1.07% vs. our 1.04% estimate. Over 40% (~2.9MM) of all smartphone gross adds and upgrades were on Next plans, up from 15% in Q4’13, and excluding the 1.1MM "accelerated upgrades,"the Next take rate was ~35% in Q1," added the analyst.
Shares of AT&T closed at $36.29 yesterday.
Serious News for Serious Traders! Try StreetInsider.com Premium Free!
You May Also Be Interested In
- Roth Capital Downgrades Orion Energy Systems (OESX) to Neutral
- Needham & Company Cuts Price Target on Cognex Corp (CGNX) Following 2Q Report
- Wedbush Cuts Price Target on Trex (TREX) Following 2Q Results
Create E-mail Alert Related CategoriesAnalyst Comments, Analyst EPS View
Related EntitiesWells Fargo, Definitive Agreement
Sign up for StreetInsider Free!
Receive full access to all new and archived articles, unlimited portfolio tracking, e-mail alerts, custom newswires and RSS feeds - and more!