Nomura Securities Maintains a 'Buy' on AT&T (T); Commentary on DOJ Move to Block Merger

Nomura Securities maintains a 'Buy' on AT&T (NYSE: T) price target of $34.00.

Nomura analyst, Mike McCormack, said, "Yesterday, the DOJ elected to sue to block the proposed AT&T/T-Mobile merger on anticompetitive concerns. We believe that AT&T plans to petition for an expedited hearing, which, if successful, should not extend the merger closing timeline from beyond the 1Q12 estimation. The burden of proof is on the DOJ, not AT&T, and the DOJ’s action does not stop the FCC review. Without the combination of AT&T and T-Mobile, we think the outlook for equity investor returns is curtailed by ARPU deceleration and subsidy acceleration headwinds. We also believe this is a negative for Sprint given significant timing, funding and technology risks."

For more ratings news on AT&T click here and for the rating history of AT&T click here.

Shares of AT&T closed at $28.48 yesterday.

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