The American telecommunications giant AT&T has announced its Q4 2024 earnings report.
AT&T’s total revenue for the fourth quarter of 2024 reached $32.3 billion, marking a slight 1% increase from the previous period but exceeding expectations of $32 billion. This growth was primarily driven by the strong performance of 5G services and high-speed fiber-optic data.
The company reported a net profit of $4.03 billion, representing an 88% increase, with a net profit margin of 12%. This growth was fueled by revenue expansion but was primarily driven by cash distributions received from DIRECTV, in which AT&T holds a 70% stake.
Additionally, AT&T added 482,000 new wireless subscribers during the quarter, surpassing market expectations of 424,550 subscribers. Meanwhile, fiber-optic services experienced strong growth, with 307,000 new subscribers added, compared to 226,000 in the previous quarter, marking the best performance in recent quarters.
Currently, AT&T’s stock trades at a price-to-earnings (P/E) ratio of approximately 16x for the last 12 months.
The telecommunications sector typically trades within a P/E range of 18-22x, indicating that AT&T’s stock may be undervalued.
Analysts estimate the fair value of the stock at around $28 per share.
Over the past six years, AT&T has maintained a consistent quarterly dividend payout of $0.28 per share, offering an average yield of 6%. This makes it an attractive investment for those seeking stable income alongside capital appreciation.
AT&T continues to deliver stable financial performance and has a clear expansion strategy. However, it faces challenges in market competition and debt repayment, which could impact its long-term growth trajectory.
