Petra Vacval (Morningstar)

Petra Vacval (Morningstar) by The Financial Exchange


Transcript - Not for consumer use. Robot overlords only. Will not be accurate.

Right it is time for stock talk and we're joined by Petra back vial from Morningstar welcome Patrick. Petra how are you today. Harry good we're talking about AT&T can you talk a little bit about whether or not you're bullish or bearish on the right now. Frankly I just get a hold purview of the space so that the dominant theme for the past year as a wireless base have been intensifying competition and so with wireless the economics pressured by escalating price competition from T-Mobile and spread. AT&T is attempting to diversify away for wireless. That eighteenth he would simultaneously pursuing a horizontal and vertical integration strategy here. Still require DirecTV and 2015 and with that they became the largest PTV provider in the U lack. And so eighteen he hopes to copy the kid industry's playbook. By providing tactic triple playing quite quite offering. So bundling multiple data pipes together so wireless phone mobile broadband wired by the and it paid TV. So right now with AT&T AT&T is the current price of 38 dollars and we at a price target. A forty dollars that we believe in the service slightly undervalued so despite all the challenges here we feel that's. Already reflected in the stock price and the AT&T sport and attracted dividend yield. About 5% that often makes it attractive. What are the questions that I have Patrick you know you mentioned the the acquisition of DirecTV. But court cuttings a major theme as well they buying right into a dying industry. Well what happens grade classes and because in our view with AT&T AT&T brought a they bought it declining satellite Tiki did business at what we believe with the rich right. What they're trying to do is to. Do you that bundling strategy similar to the cable providers so that trouble playing quad play. So for instance in Europe that converged wired wireless squad played they would offering their very popular and sticky. But it remains to be seen at the Iraq firing we'll have a broad appeal and the EU Latin. So that's the big question for that to business but the whole how effectively AT&T bundling strategy be at gaining and retaining subscribers. Well where else can they try to find additional growth are there any other initiatives they're undertaking right now. Mean the web is that the big. Pending thing for them right now depending Time Warner acquisitions felt. With that we feel AT&T will be buying a good bed nets that we expected synergies there to be minimal because it's a vertical acquisition they're buying can contact. And again but I hated also returner opinion and that and that Falwell pat Harry turns out over our capital. What AT&T aims to do with Time Warner is that hopes to eventually my tight Time Warner's contents via a appeared targeted advertising. Which really enabled by the unique data attitude that says by virtue of being a service provider but the execution detail on that are still Haiti. Very good Patrick thank you very much for joining us we appreciate the time today. Petra back Ralph for a morning start talking about AT&T the ticker on the if you do want to look them up yourself. Is T. About how much money we spend on that now relative to we spent you know thirty years ago. You appeal to the net oh it's crazy you know you think they about the the two things to bills that you have today that no one had back in the seventies you've got cell phone bills yeah. Cable bills now. Don't know what that was back in the seventies and Wi-Fi in values like Ian Ian paper Wi-Fi and know that you think about it and it went into doing it Wi-Fi camera ninety's. Thank you actually want finer house yeah. I mean that's that's a that's really last ten years kinda development prior to that it was only had a hard wired ethernet ports and you had a high speed Internet. But that's pretty much about it there so it's. You know it's been a very recent development we're spending thousands of dollars a year on these things.