AT&T shares close lower on Thursday, company revises down free cash flow forecast, quarterly profit beats

AT&T Inc (T) on Thursday revised down its annual free cash flow forecast by $2 billion, as it continues expanding 5G and fiber internet availability.

The company now forecasts full-year 2022 free cash flow of around $14 billion compared with $16 billion, as expected previously.

AT&T’s total revenue of $29.6 billion was roughly in line with market expectations, while the company revised up its annual revenue growth forecast.

The company gained over 800,000 monthly bill-paying wireless subscribers and 316,000 new broadband clients during the quarter ended on June 30th.

In June, AT&T increased prices on some of its older plans and also warned prices could be raised again as surging inflation has pushed up labor, supply and transportation costs.

Earnings per share, excluding special items, were reported at $0.65 in the quarter, while exceeding market consensus of $0.61 per share.

“As a result of our higher-than-forecasted customer growth, we’re increasing our mobility service revenue guidance to 4.5%-5% growth for the full year,” AT&T Inc’s Chief Executive Officer John Stankey said in a statement.

AT&T shares closed lower for a second consecutive trading session in New York on Thursday. It has also been the steepest single-session loss since January 26th. The stock went down 7.62% ($1.56) to $18.92, after touching an intraday low at $18.25. The latter has been a price level not seen since April 8th ($17.77).

The shares of AT&T Inc have risen 1.88% so far in 2022 compared with a 16.10% loss for the benchmark index, S&P 500 (SPX).

In 2021, AT&T Inc’s stock went down 14.46%, thus, it underperformed the S&P 500, which registered a 26.89% gain.

Analyst stock price forecast and recommendation

According to TipRanks, at least 7 out of 11 surveyed investment analysts had rated AT&T Inc’s stock as “Buy”, while 4 – as “Hold”. The median price target on the stock stands at $23.85.