The firm maintained its price target of $38.
Subscriber additions at AT&T and Verizon (VZ) are likely to be pressured due to the iPhone 7 release, as Sprint (S) and T-Mobile (TMUS) offer unlimited/large data bundles, the firm said, according to Barron's.
That said, HSBC noted that AT&T's valuation should remain unchanged. The firm values AT&T's U.S. business on a discounted cash flow basis.
AT&T has an EBITDA multiple of 6.6x for fiscal 2017, compared to 6-7x for US peers and 5-8x for European competitors, HSBC added.
(AT&T is a holding in David Peltier's Dividend Stock Advisor.)
Separately, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:
TheStreet Ratings team rates AT&T as a Buy with a ratings score of A+. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that it rates. The company's strengths can be seen in multiple areas, such as its robust revenue growth, increase in net income, good cash flow from operations, solid stock price performance and expanding profit margins. The team feels its strengths outweigh the fact that the company has had generally high debt management risk by most measures that it evaluated.
You can view the full analysis from the report here: T