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AT&T (T) Collaborates With ESL for Video-Gaming Venture

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AT&T (T - Free Report) has ventured into the competitive video-gaming arena by collaborating with ESL — the largest esports powerhouse in the world. The move, which is in tune with the evolving landscape of the consumer entertainment industry, marks a distinct shift by AT&T from traditional sporting events like NFL, NBA and MLB, to stay connected with customers.

With the alliance, AT&T has become the Official Telecommunications and Mobile Gaming Partner of ESL North America. This will help the company to reach to a younger demography by showcasing its services in some of the biggest events and platforms in video gaming — Arena of Valor Pro League, the E3 ESL Arena, ESL One New York, and Intel Extreme Masters North America.

AT&T will leverage its sports brand image to tap the huge revenue-generating potential of this emerging industry through brand promotions and on-site activations. This will help the company to actively engage with fans through superfast Wi-Fi connections and convenient charging stations, displaying the latest offerings through immersive experiences and demos.

It will also offer a perfect platform to demonstrate how AT&T intends to incorporate 5G technologies to take mobile esports and live gaming to the next level through an ultra-fast and low-latency 5G connection. All these endeavors will enable the company to stay relevant to a mobile-centric audience as well as casual and professional gamers, who prefer to remain engaged with mobile gaming and competitive esports on-the-go.

Shiz Suzuki, assistant vice president of AT&T's corporate sponsorships said, “Esports creates a natural intersection of technology and entertainment, which aligns with our brand and our customers’ passions.”

AT&T has underperformed the industry in the last three months with an average loss of 12.1% compared with a decline of 6.7% for the latter. Whether such out-of-the-box brand promotion idea will boost the sagging shares of the company in the future remains to be seen.

AT&T currently carries a Zacks Rank #3 (Hold). Some better-ranked stocks in the industry are Motorola Solutions, Inc. (MSI - Free Report) , Ubiquiti Networks, Inc. (UBNT - Free Report) and PLDT Inc. (PHI - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Motorola has a long-term earnings growth expectation of 8%. It surpassed estimates in each of the trailing four quarters with an average positive earnings surprise of 12.1%.

Ubiquiti Networks has a long-term earnings growth expectation of 18.6%. It topped estimates thrice in the trailing four quarters with an average positive earnings surprise of 8.9%.

PLDT is currently trading at a forward P/E (F1) of 11.2x.

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