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AT & T Incorporation: Changes In The Telecommunication Industry

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Summary:
AT&T Incorporation is one of the largest public sector companies operating in United States. The company has been striving to retain the position in the market and attract customers by investing in new technologies. The revenue of the company is expected to grow at 7% in the current year that will help in increasing the market share for the company.
In long term, the company is expected to earn a profit at 10% annually. The shares for the company are selling at 24 P/E currently but they are expected to be sold at 27 P/E in the future years, making it a potential stock for the investors. Consequently, I consider the stock a potential opportunity to invest in and rate it as potential buy stock.
Concerns:
In the general opinion, telecommunication …show more content…

Moreover, the ROE in the telecommunication sector of US is -4.71% on average for the last 5 years. The return on Investment in the industry is 5.38%. These figures do not make this sector a demanding sector for investment. The following figure shows the trend in the telecommunication sector of US for the last year as compared to the S&P Index 500.
Figure 4:
Trend in Telecommunications sector as compared to S&P

Source: Research Fidelity (2015)
The fierce competition in the industry between the three to players will not help any of the players to expand despite of the available growth opportunities (Moody's: Wireless Segment Will Drive Growth in the US Telecom Sector, 2015). …show more content…

It is one of the leading telecommunication companies of United States headquartered in Dallas Texas (Overview, 2015). The company has more than 3.5 million customers, serving not only individual customers but the corporate customers as well. In the US telecommunication sector AT&T is the second largest firm with respect to the market share occupying 32.1% of the whole sector. The company was incorporated as Southwestern Bell Corporation in 1983. Later, it was transformed into AT&T, giving the company a new vision and a new look. The company provides wired and wireless connection services to its customers. Moreover, the cloud, networking, hosting services are also provided by the company (Enterprise Business Services,

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