AT&T

Analyst Listing

The following analysts provide coverage for the subject firm as of May 2016:

Broker Analyst Analyst Email
Drexel Hamilton Barry M. Sine bsine@drexelhamilton.com
Cowen & Company Colby Synesael colby.synesael@cowen.com
FBR Capital Markets & Co David Dixon ddixon@fbr.com
Raymond James Frank G. Louthan IV frank.louthan@raymondjames.com
William Blair James D. Breen jbreen@williamblair.com
DA Davidson James Moorman jmoorman@dadco.com
Buckingham Research James Ratcliffe jratcliffe@buckresearch.com
Scotiabank GBM Jeffrey Fan jeff.fan@scotiabank.com
Nomura Research Jeffrey Kvaal jeffrey.kvaal@nomura.com
Wells Fargo Securities Jennifer M. Fritzsche jennifer.fritzsche@wellsfargo.com
RBC Capital Markets Jonathan Atkin jonathan.atkin@rbccm.com
Evercore ISI Jonathan Schildkraut schildkraut@evercoreisi.com
Credit Suisse Joseph Mastrogiovanni joseph.mastrogiovanni@credit-suisse.com
Deutsche Bank Research Matthew Niknam matthew.niknam@db.com
Pacific Crest Securities-KBCM Michael G. Bowen mbowen@pacific-crest.com
Jefferies Mike McCormack mmccormack@jefferies.com
Bernstein Research Paul de Sa paul.desa@bernstein.com
Oppenheimer Timothy Horan tim.horan@opco.com
BTIG Walter Piecyk wpiecyk@btig.com

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Primary Input Data

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Derived Input Data

Derived Input

Label

2015 Value

2016
Value

Equational Form

Net Operating Profit Less Adjusted Taxes NOPLAT  16,012 16,818 NOPLAT\, =\, EBIT\, x\, (1 \,-\, Avg \,\,Tax\,\, Rate\,\, on\,\, EBIT)
Free Cash Flow FCF 15,865 16,936 FCF\,=NOPLAT\,+\,Non-Cash\,Expenses-\Delta NWC\,-\,NCS
Tax Shield TS 1,411 1,628 TS\,=\,Interest\,\,Paid\,\,x\,\, Avg \,\,Tax\,\,Rate\,\, on\,\, Pre-Tax\,\, Income
Invested Capital IC (21,410) (22,847) IC\,=\,Fixed\,\,Operating\,\,Assets\,\,+\,\,Net\,\, Working\,\, Capital
Return on Invested Capital ROIC -74.79% -73.61% ROIC\,=\,\frac { NOPLAT }{ IC }
Net Investment NetInv 14,671 24,410 NetInv\,=\,{ {IC}_{1}}-{{IC}_{0}}+Depreciation
Investment Rate IR 91.62%  145.14% IR\,=\,\frac {NetInv}{NOPLAT}
Weighted Average Cost of Capital
WACCMarket 7.07% 6.12% WACC\,=\,\frac { E }{ V } { R }_{ E }\,+\,\frac { P }{ V } { R }_{ P }\,+\,\frac { D }{ V } { R }_{ D }\left( 1- Avg\,\, Tax\,\,Rate\,\,on\,\,Pre-Tax\,\,Income \right)
 WACCBook  5.53%    5.52%
Enterprise value
EVMarket 321,887 374,979 EV\,=\,Market\,\,Cap\,\,Equity\,+\,\,Long\,\,Term\,\,Debt\,-\,Cash
 EVBook  323,929  368,739
Long-Run Growth
g = IR x ROIC
-68.52%  -106.84% Long-run growth rates of the income variable are used in the Continuing Value portion of the valuation models.
g = % \Delta GDP  2.50%     2.50%
Margin from Operations M 16.78%    15.80% M\,\,=\,\,\frac{EBIT}{SALES}
Depreciation/Amortization Rate D 47.19%    49.97% D\,\,=\,\,\frac{D+A}{EBITDA}

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Valuation Multiple Outcomes

The outcomes presented in this study are the result of original input data, derived data, and synthesized inputs.

Equational Form

Observed Value

Single-stage

multiple g solution

Two-stage valuation

model g solution

12/31/2015 12/31/2016 12/31/2015 12/31/2016 12/31/2015 12/31/2016

EV/SALES 

\frac {EV}{Sales} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)\,(M)

 2.19  2.29  1.97%  1.54%  2.23%  2.67%

EV/EBITDA

\frac {EV}{EBITDA} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)\,(1\,-\,D)

6.90 7.25 1.97% 1.54% 2.23% 2.67%

EV/NOPLAT

\frac {EV}{NOPLAT} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}

20.10 22.30 1.97% 1.54% 2.23% 2.67%

EV/FCFOPS

\frac {EV}{FCF_{OPS}} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)

20.29 22.14 1.97% 1.54% 2.23% 2.67%

EV/EBIT

\frac {EV}{EBIT} \,= \,\frac{ROIC\,  -\,  g}{ROIC\,(WACC\,-\,g)}\,(1\,-\,T)

13.07 14.49 1.97% 1.54% 2.23% 2.67%

EV/IC

\frac {EV}{IC} \,= \,\frac{ROIC\,  -\,  g}{WACC\,-\,g}

-15.03 -16.41 1.97% 1.54% 2.23% 2.67%

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