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AT&T stock has fallen 18% in 2023.
Justin Sullivan/Getty Images
AT&T
stock is falling in Thursday trading, and a report in The Wall Street Journal about toxic lead network cables will not help shares bounce back, one Citi analyst said.
Shares of telecom giant
AT&T
(ticker: T) are down 0.7% on Thursday to $15.02, which would be the lowest close for the stock since October 2022, according to Dow Jones Market Data. The stock has fallen for the past seven consecutive trading days, or 6.8% over that period. If AT&T ends Thursday in the red, it would be the stock’s longest losing streak since June 2022.
AT&T stock now sports a year-to-date loss of 18%, while the
S&P 500
has gained 17%.
Recent news surrounding legacy telecom companies is going to be another headwind for the stock, Citi analyst Michael Rollins wrote in a research note on Monday. So far, he’s been correct.
The Journal published an article on July 9 that said AT&T,
Verizon Communications
(VZ), and other telecom companies have network cables covered in potentially toxic lead across the U.S., some laid by predecessor companies.
Barron’s reached out to AT&T for comment. USTelecom, a broadband association that represents telecom companies, responded, and said in a statement that “the telecom industry has a long tradition of closely following science and evidence as it relates to public health, environmental protection, and worker safety issues. And safe work practices within the industry have proven effective in reducing potential lead exposures to workers.”
USTelecom added that a lot of consideration goes into determining whether legacy lead-sheathed telecom cables should be removed or should be left in place, and that “the U.S. telecommunications industry stands ready to engage constructively on this issue.”
Rollins, who rates AT&T as a Buy wit a $22 price target, wrote in a research note that “possible risks from lead-sheathed cabling was not specifically cited in AT&T’s [February] 10-K filing, although it did reference the potential risks related to unfavorable litigation or governmental investigations that could require the firm to pay significant amounts or lead to onerous procedures.”
“We believe stocks with wireline exposure could trade lower near-term on the uncertainty and risk associated with the concerns raised by the WSJ,” Rollins added.
Write to Angela Palumbo at [email protected]
Source: https://www.barrons.com/articles/at-t-stock-lead-cables-854ed9bb?siteid=yhoof2&yptr=yahoo