Poppy girl

I am thinking about investing in AT&T just got of the phone with an adviser and am very interested especially as they have just bought out T.Mobile....do you have shares or dabble in them, my old dad played them every day and made a tidy sum, unfortunately his daughter does not have the brain or patience, never the less I would like to make a little investment.

Any thoughts please!

avanutria

I once worked for Fidelity as a call center temp and while there I tried a flutter on a tech company, just to see what it was like to buy shares. That was 2004. I was charged something like $30 just to the pleasure of buying the stuff. A couple years later the shares were valued so low that the consoldated them, and I had half as many which were each worth twice as much as they had been. The next time I checked, maybe 2008 or so, they had gone so low in value that they'd vanished.

Poppy girl

Bit like betting on the horses hey!

AT&T is down today but I have high expectations.

avanutria

Exactly - only invest what you're prepared to lose. I think I put in $180 or so including the fees, so $150 of stock. I thought about selling when the value had dropped to under $100 but it would have cost me another $30 just to get my money out, so I figured why not proceed with the experiment.

candy wy.

They have not yet Bought T- mobile still alot of hoops to jump through..and if its anything like when they bought alltel it will be 2 years before it is done.

Poppy girl

I think it is imminent and will go through very quickly in this instance, but we will see!!

http://www.reuters.com/article/2011/...15260220110322

Michael

It will take about a year to get federal government approval (will likely have to sell off some assets to get approval). If they do get approval, it will probably be good deal for AT&T since their networks are compatible (only their frequencies are different) and the claim is that synergies are equal to the cost of acquiring T-mobile (usually much lower). Also this should solve the problem with dropped calls for the iPhone.

AT&T is currently paying a very high 6.09% annual dividend so even if the stock doesn't move upward, you are likely to be ok on that purchase. It is a fairly low risk stock but probably not be a high growth stock.

Poppy girl

Thank you and thats what I am thinking get in now wait for the egg to hatch, either way I can't see me losing a worrying amount.......when and if the T.Mobile deal goes through then the benefits/high growth may become more fruitful.

Michael

Buy it. I own 1,000 shares as a more conservative investment in my portfolio. Considering that it is paying about a 6% dividend and is likely to continue that dividend in the foreseeable future, that will be 60% over the next 10 years so even if there is a major market pullback in the future. it is likely you will still come out ahead.

Ex-dividend date will be around April 6th so it is probably good to purchase it now before it gets too near to that date since it is usually bid up when it gets close. On the ex dividend date, the closing price of the previous day will be adjusted downward by the dividend ($0.43 per share).

celticgrid

+1

I recently added AT&T to my little portfolio on the basis the money will make more in dividends than it was making in interest. I'm not expecting the share price itself to rocket but while interest rates are low this feels like a comfortable investment. And the recent proposed purchase of T-Mobile makes it all a little bit more interesting.

Michael

Also dividends are qualified so the maximum federal income tax rate is 15%.

robin1234

+2
The dividend makes At&T a good deal.
My wife has AT&T and Verizon, which is another good dividend payer.
She's had them since 1982, so the history of spin-offs, name changes, amalgamations etc. in those years is amazingly complex.
The history goes back even further! In 1982 her great-aunt died, having owned the shares since the 1930s. She left her share portfolio divided between nine relatives including my wife. Between her dying and the probate process, AT&T agreed to divest (breakup into the baby bells.) My wife's CPA uncle had great fun breaking up the AT&T shares into the baby bells, then breaking up each of these 9 ways. So for all those 30 years we've had those baby bell shares, each one of which has sent a small cheque in the mail four times a year. Then there have been the small spin-offs, some of which have gone bankrupt, others done fairly well. Then more recently, some of the baby bells have re-amalgamated (like AT&T itself.) As you can imagine, this is an education in capitalism and stock-ownership all on its own! (Of course if you hold the shares in a brokerage account you miss all the details, like getting the checks, receiving the invitation to the AGM, electing the officers, the letters about the various class-action suits when piss-ant companies like Fairport Communications go bankrupt etc.)

But long story short, the Baby Bells have in general proved to be a good long-term holding, both in terms of stock price and dividends.

Michael

The biggest problem with AT&T as well as Verizon is that a large part of their business is in land line phone systems which are declining, not very profitable, and regulated more than mobile phones.

AT&T has U VERSE for it's tv programming which is cheap to build out but does not have the bandwidth (bit rate) of Verizons FIOS which is expensive to build out. Both have fibre laid in the streets but AT&T only needs special amplifiers to drive the phone lines to the house but Verizon needs to lay fibre from the street to the house to support FIOS.

AT&T should have an advantage if the T-mobile purchase happens since they will likely have more customers and larger mobile coverage than Verizon.

avanutria

I only hope they'll continue to offer T-Mobile's pay as you go options, which I've been using for the last few months.

fsm

We decided to invest $600 a couple of years ago, it's currently worth Approx $1750

When the bank share where so low we bought 100 shares in bank of america @ 4.51 a share and paid $10 for the priviliage.

Also for the sheer hell of it we bough 7 Disney shares as my wife is a disney freak, those have doubled in value as well.