-0.10 | -0.29%
AT&T INC's gross profit margin for the first quarter of its fiscal year 2012 is essentially unchanged when compared to the same period a year ago. The company has grown its sales and net income during the past quarter when compared with the same quarter a year ago, and although its growth in net income has outpaced the industry average, its revenue growth has not. AT&T INC has very weak liquidity. Currently, the Quick Ratio is 0.48 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.
During the same period, stockholders' equity ("net worth") has decreased by 6.79% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.
| Income Statement | Q1 FY12 | Q1 FY11 |
|---|---|---|
| Net Sales ($mil) | 31822.0 | 31247.0 |
| EBITDA ($mil) | 10661.0 | 10392.0 |
| EBIT ($mil) | 6101.0 | 5808.0 |
| Net Income ($mil) | 3584.0 | 3408.0 |
| Balance Sheet | Q1 FY12 | Q1 FY11 |
|---|---|---|
| Cash & Equiv. ($mil) | 2588.0 | 1391.0 |
| Total Assets ($mil) | 269356.0 | 268085.0 |
| Total Debt ($mil) | 65709.0 | 65028.0 |
| Equity ($mil) | 104899.0 | 112544.0 |
| Profitability | Q1 FY12 | Q1 FY11 |
|---|---|---|
| Gross Profit Margin | 59.42 | 58.99 |
| EBITDA Margin | 33.5 | 33.26 |
| Operating Margin | 19.17 | 18.59 |
| Sales Turnover | 0.47 | 0.47 |
| Return on Assets | 1.53 | 7.77 |
| Return on Equity | 3.93 | 17.81 |
| Debt | Q1 FY12 | Q1 FY11 |
|---|---|---|
| Current Ratio | 0.64 | 0.59 |
| Debt/Capital | 0.39 | 0.37 |
| Interest Expense | 924.0 | 881.0 |
| Interest Coverage | 6.6 | 6.59 |
| Share Data | Q1 FY12 | Q1 FY11 |
|---|---|---|
| Shares outstanding (mil) | 5874.71 | 5918.27 |
| Div / share | 0.44 | 0.43 |
| EPS | 0.6 | 0.57 |
| Book value / share | 17.86 | 19.02 |
| Institutional Own % | n/a | n/a |
| Avg Daily Volume | 2.744324E7 | 2.5861484E7 |
BUY. AT&T INC's P/E ratio indicates a significant premium compared to an average of 31.78 for the Diversified Telecommunication Services industry and a significant premium compared to the S&P 500 average of 15.19. To use another comparison, its price-to-book ratio of 1.88 indicates valuation on par with the S&P 500 average of 2.12 and a discount versus the industry average of 2.03. The current price-to-sales ratio is above both the S&P 500 average and the industry average, indicating a premium. The valuation analysis reveals that, AT&T INC seems to be trading at a premium to investment alternatives within the industry.
| Price/Earnings |
|
Price/Cash Flow |
| |||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| T 48.75 | Peers 31.78 | T 5.73 | Peers 18.09 | |||||||||||||||||||||
|
Premium. A higher P/E ratio than its peers can signify a more expensive stock or higher growth expectations. T is trading at a significant premium to its peers. |
Discount. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures. T is trading at a significant discount to its peers. |
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| Price/Projected Earnings |
|
Price to Earnings/Growth |
|
|||||||||||||||||||||
| T 13.14 | Peers 14.04 | T 0.19 | Peers 0.38 | |||||||||||||||||||||
|
Average. An average price-to-projected earnings ratio can signify an industry neutral stock price and average future growth expectations. T is trading at a valuation on par with its peers. |
Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples. T trades at a significant discount to its peers. |
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| Price/Book |
|
Earnings Growth |
|
|||||||||||||||||||||
| T 1.88 | Peers 2.03 | T -79.47 | Peers -38.91 | |||||||||||||||||||||
|
Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet. T is trading at a valuation on par with its peers. |
Lower. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios. However, T is expected to significantly trail its peers on the basis of its earnings growth rate. |
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| Price/Sales |
|
Sales Growth |
|
|||||||||||||||||||||
| T 1.55 | Peers 1.22 | T 1.84 | Peers 12.92 | |||||||||||||||||||||
|
Premium. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales. T is trading at a significant premium to its industry. |
Lower. A sales growth rate that trails the industry implies that a company is losing market share. T significantly trails its peers on the basis of sales growth |
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