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The Zacks Analyst Blog Highlights: AT&T, Comcast, Verizon Communications and T-Mobile US


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For Immediate Release

Chicago, IL – October 12, 2016 – announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include AT&T Inc. (NYSE:(T - Analyst Report) -Free Report),Comcast Corporation (NASDAQ:(CMCSA - Analyst Report) -Free Report),Verizon Communications Inc. (NYSE:(VZ - Analyst Report) -Free Report) andT-Mobile US Inc. (NASDAQ:(TMUS - Analyst Report) -Free Report).

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Here are highlights from Tuesday’s Analyst Blog:

Is AT&T Planning on Entering the Media Entertainment Space?

As per a recent report by Bloomberg, leading wireless and pay-TV company AT&T Inc. (NYSE:(T - Analyst Report) -Free Report) is looking to foray into the media and entertainment industry. Notably, the telecom giant intends to expand through the acquisition of a number of media and programming content producing companies over the next few years. Notably, AT&T’s pay-TV rival and cable giant Comcast Corporation (NASDAQ:(CMCSA - Analyst Report) -Free Report) has also adopted the same strategy to diversifying its business.

Focus on Video Programming

As prospects in the wireless industry are dim due to a saturated market, telecom players are looking to boost revenues through the adoption of different strategies. Although business services solutions have been gaining momentum, some cash rich telecom companies are looking for further diversification. AT&T’s wireless rivals Verizon Communications Inc. (NYSE:(VZ - Analyst Report) -Free Report) and T-Mobile US Inc. (NASDAQ:(TMUS - Analyst Report) -Free Report) have been active in the mobile advertisement space. AT&T, on the other hand, has been focusing on the pay-TV industry and is the largest pay-TV operator in the U.S. post its acquisition of satellite TV provider DIRECTV. However, the pay-TV industry faces cord cutting and regular escalation in programming content costs, affecting margins to a large extent. Thus, a move into content production space will help AT&T reduce programming costs.

The Bottom Line

As AT&T operates as a pay-TV operator as well, investing in media and content programming will allow it to achieve backward integrated synergies, mostly reduction of cost to deliver content to subscribers. However, such a move will not be easy as the company doesn’t have the required cash to expand a newly created media division. Thus, it has to raise more debt for foraying into the media space. However, with a net debt at the end of second quarter of 2016, piling up further debt may spook investors.

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Today, Zacks is promoting its ''Buy'' stock recommendations. Get #1Stock of the Day pick for free.

About Zacks Equity Research

Zacks Equity Research provides the best of quantitative and qualitative analysis to help investors know what stocks to buy and which to sell for the long-term.

Continuous coverage is provided for a universe of 1,150 publicly traded stocks. Our analysts are organized by industry which gives them keen insights to developments that affect company profits and stock performance. Recommendations and target prices are six-month time horizons.

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