AT&T (T) On Track To Offer Nationwide 5G Service In 2020

AT&T Inc.’s (NYSE:T) largest operating segment, AT&T Communications, recently announced that it is working to bring 5G service to millions of consumers and businesses this year. The telecom bellwether remains on track to provide nationwide 5G to customers in the first half of 2020. It stated that, in the coming weeks, its 5G network will be launched over low-band spectrum in areas of Indianapolis, IN; Pittsburgh, PA; Providence, RI; Rochester, NY; and San Diego, CA.

The company also intends to launch this breakthrough service in several markets, which include Boston, Las Vegas, Milwaukee, New York City, San Jose, San Francisco, Birmingham, Bridgeport, and Louisville. Further, it continues to offer 5G+ over mmWave spectrum to enterprises in parts of 21 cities at present and aims to reach 30 cities in early 2020. Its 5G+ technology uses millimeter wave spectrum to provide ultra-fast speed, lower latency and better connectivity in mobile devices.

After the recent launch of its Unlimited Extra and Unlimited Elite plans at an incredible value, the company is now adding 5G in these options. It will begin pre-orders for its first low-band 5G smartphone, Samsung (KS:005930) Galaxy Note10+ 5G, on Nov 25.

The company is focused on building networks that will enable fiber-based connectivity and LTE to work efficiently side by side with 5G solutions, making the most of business transformation. AT&T’s wireless network covers more than 99% of Americans and is reportedly the fastest in the nation. Its LTE network covers more than 400 million people in North America. Sustainable subscriber growth, backed by network expansion, remains a key driver.

For the three-year period of 2020-2022, AT&T expects consolidated revenue growth of 1-2% per year. Adjusted earnings are expected between $4.50 and $4.80 per share by 2022, with adjusted EBITDA margin of 35%. Free cash flow is anticipated between $30 billion and $32 billion in 2022, with net debt-to-adjusted EBITDA of 2x to 2.3x as 100% debt related to the acquisition of Time Warner assets is likely to be repaid.

Driven by strong execution of operational strategies, the stock has gained 31.7% compared with the industry’s growth of 15.8% year to date. The company topped earnings estimates thrice in the trailing four quarters, delivering an average beat of 0.9%.



AT&T currently has a Zacks Rank #3 (Hold).

A few better-ranked stocks in the broader industry are Qualcomm Incorporated (NASDAQ:QCOM) , Ubiquiti Inc. (NASDAQ:UI) and PCTEL, Inc. (NASDAQ:PCTI) . While Qualcomm and Ubiquiti sport a Zacks Rank #1 (Strong Buy), PCTEL carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Qualcomm has long-term earnings growth expectation of 14%.

Ubiquiti has long-term earnings growth expectation of 9.4%.

PCTEL surpassed earnings estimates in the trailing four quarters, the average surprise being 150.6%.

The Hottest Tech Mega-Trend of All

Last year, it generated $24 billion in global revenues. By 2020, it's predicted to blast through the roof to $77.6 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.

See Zacks' 3 Best Stocks to Play This Trend >>

QUALCOMM Incorporated (QCOM): Free Stock Analysis Report

PC-Tel, Inc. (PCTI): Free Stock Analysis Report

AT&T Inc. (T): Free Stock Analysis Report

Ubiquiti Inc. (UI): Free Stock Analysis Report

Original post

Zacks Investment Research