HomeMost PopularAT&T: Pay Yourself 11% With This Bond-Like Exposure

AT&T: Pay Yourself 11% With This Bond-Like Exposure

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AT&T (NYSE:T) is a telecommunications giant that has garnered significant attention in recent years. Despite its well-documented controversies, the company’s strong financials and simplified business model make it an attractive option for income-focused investors.

The Q3 Earnings Report

In the company’s recent Q3 earnings report, AT&T exceeded expectations with an EPS of $0.64 and revenue of over $30.3 billion. While year-over-year revenue growth was modest, the consistent positive growth demonstrates stability in the company’s performance.

AT&T’s Prospects

Following its breakup with Warner Bros. Discovery (WBD), AT&T has refocused on its core communications business. With improved financials and a streamlined structure, AT&T is now better positioned to compete with industry leaders like Verizon (VZ).

The Trade

Selling put options on AT&T presents an attractive opportunity for income generation. By selling put options, investors can potentially earn a return of 1.52% over the next 47 days. If the stock remains above the strike price, investors keep the premium as profit. If the stock dips below the strike price, investors have the opportunity to purchase the stock at a discounted price while retaining the premium.

Risks and Summary

While there are risks associated with selling put options and investing in AT&T, such as potential market volatility and the company’s debt load, the conservative nature of the trade strategy mitigates some of these concerns. Overall, AT&T’s strong financial footing and attractive valuation make it a compelling investment option for income-focused investors.

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