Mobile Showdown - AT&T

 

As we veered into the communications sector, we simply could not stay away from the massive rivalry existing between AT&T, Sprint, and Verizon. Although each company is not necessarily owned by just one larger company, we want to see what makes the companies tick, why they are the top three (in the USA), and which are the best investments. This week we will analyze all three major carriers, starting today with AT&T (T).

AT&T once again falls under the wired and wireless connectivity description, but perhaps more than other companies. T encompasses all wired connectivity (Internet cables, home phones, etc.) and all wireless devices as well (cell phones, broadband, TV antennas through contracts with DirectTV, Dish, and the like). Judging from the plethora of services offered, not specified to any particular area of expertise but rather a wide range of services for personal and business use, we can already see why AT&T remains one of the top players. As we will discuss in the coming days, however, other large companies will display similar products and positions. The key to earning a competitive stand in the market, of course, is through competitive pricing; the best prices per product will gain the most customers, but competitiveness prevents any company from monopolizing the market.
Our records date back to the mid-1980's, when AT&T was established in 1983. Until 1999 the company showed tremendous, and unbelievably positive growth. Since the turn of the century, and the end of the Information Era madness, stocks fell back down but restrengthened before the recession in 2008. Fortunately, however, stocks recuperated into 2012; unfortunately, a stark contrast to early 2012, the latter part of the year began showing decline in stock price. While these long-term occurrences helped us to predict future economic growth, more recent activity shows social issues, rather than those economic, provoke AT&T's current stock instability. On November 1st, AT&T and T-Mobile spread a rumor of a possible liaison, but this enacted few new trading trends as the other companies had similarly exposed such claims. Note that we are not analyzing T-Mobile; it is the only company of the top four to have lost competitive vigor (we will discuss it in later posts). Back to T and social issues, mid-November witnessed that AT&T was voted the best employer of LGBT. In modern society, this remains a highly controversial debate, fought between conservatives and liberals, which we will not delve further into. This new controversy surrounding the company causes heavy fluctuations in the market and we decided to declare the company as a not buy.
Since our decision, we have noticed a slight revitalization in the communications sector that spurted minor growth within AT&T. Google supposedly holds claims to partner with Dish Network in making a new wireless service; overall, the sector is seeing greater activity and promised growth. Although we still have doubts about investing in AT&T, and haphazardly made slight profits in our own trials, we believe stocks are starting to stabilize and encourage short-term investing before the end of the fiscal quarter!