Barclays analyst Kannan Venkateshwar downgraded AT&T (T) to Equal Weight from Overweight with a price target of $20, down from $22. AT&T’s Q2 results, while being impacted to some extent by the macro backdrop, are likely to renew concerns about management credibility, Venkateshwar tells investors in a research note. The analyst says the company’s forward commentary “may also fuel broader concerns about industry growth visibility in the coming quarters.” While macro impacts will likely show up across the industry, the impacts may not be uniform with T-Mobile (TMUS) trends potentially outperforming, Venkateshwar contends. He says AT&T shares have significantly outperformed Verizon (VZ) and the broader markets this year. While the risk of dividend cut at AT&T is low, its relative outperformance versus the market will moderate going forward, the analyst writes.
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