Yahoo Finance AT&T Reports 1Q16 Earnings: Did It Beat Estimates Again?
AT&T Beats Estimates in 1Q16: Where Does It Stand among Peers?
AT&T’s earnings in 1Q16
AT&T (T) reported its 1Q16 results on April 26, 2016. In this series, we’ll look at the company’s performance during the quarter. AT&T’s earnings beat Wall Street’s expectations during 1Q16. On a YoY (year-over-year) basis, the company’s adjusted EPS (earnings per share) rose ~10.8% and reached ~$0.72 during the quarter. For the same quarter, both Verizon (VZ) and T-Mobile (TMUS) witnessed growing earnings. Meanwhile, Sprint (S) has not yet reported its 1Q16 (fiscal 4Q15) results.
As you can see in the above bar chart, in 1Q15, 2Q15, and 3Q15, the telecom company beat analysts’ expectations for EPS comfortably. However, in 4Q15, the telecom’s adjusted EPS were slightly below what Wall Street expected.
AT&T’s margins continue to improve in 1Q16
On the operating profitability front, the telecom company’s adjusted EBITDA (earnings before interest, tax, depreciation, and amortization) margin continued to strengthen YoY in 1Q16. The metric increased from ~32.7% in 1Q15 to ~32.8% in 1Q16, according to the company. Wall Street’s analysts’ consensus for the telecom company’s EBITDA margin was ~33% for 1Q16. In 4Q15, AT&T’s adjusted EBITDA margin was ~29.1%, compared with ~27.5% in 4Q14.
Instead of taking on direct exposure to US telecom players’ stocks, you could consider taking on diversified exposure to the space by investing in the SPDR S&P 500 ETF (SPY). The ETF held a total of ~2.8% in some of the US telecom companies at the end of March 2016. At that time, AT&T and Verizon made up ~2.6% of the ETF.
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