We’re Looking to You, Dallas

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AT&T will host their analyst update tomorrow in Dallas, Texas. Amir Rozwadowski of Barclays noted that this is the first true opportunity for management to articulate its post DirecTV strategy. “We believe investors should consider it as the first step (rather than the finish line) towards providing insight on the carrier’s longer term strategy and potential earnings power,” Rozwadowski wrote. “Thus, we expect the analyst event to serve as an incremental positive in seeding the beginning of a potential earnings revision story for AT&T.” The analyst will look for more information about the company’s investment priorities, as the reduced spending levels have been a key point of consternation for vendors and investors alike. “The recent commitment by AT&T to build out fiber access to 12.5 million customer locations as a condition for closing the DirecTV transaction also calls into question how AT&T will allocate capital (and its ability to drive improved cash generation),” Rozwadowski explains. Another topic analysts will be interested in is the carrier’s strategy in Mexico. AT&T acquired Iusacell and Nextel International, expanding their footprint in Mexico, and Rozwadowski will look for color on the carrier’s local strategy outside of the announcement of its regional investment initiatives.

August 12, 2015 |
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