What is AT&T net debt to Ebitda?
Analysis. AT&T's net debt / ebitda for fiscal years ending December 2019 to 2023 averaged 3.2x. AT&T's operated at median net debt / ebitda of 3.3x from fiscal years ending December 2019 to 2023.
Generally, net debt-to-EBITDA ratios of less than 3 are considered acceptable. The lower the ratio, the higher the probability of the firm successfully paying and refinancing its debt.
AT&T has a total shareholder equity of $119.4B and total debt of $138.3B, which brings its debt-to-equity ratio to 115.8%. Its total assets and total liabilities are $407.1B and $287.6B respectively. AT&T's EBIT is $26.2B making its interest coverage ratio 3.9. It has cash and short-term investments of $6.8B.
AT&T 2023 annual EBITDA was $42.238B, a 214.41% increase from 2022. AT&T 2022 annual EBITDA was $13.434B, a 69.29% decline from 2021. AT&T 2021 annual EBITDA was $43.749B, a 41.61% increase from 2020.
Analysis. Coca-Cola's net debt / ebitda for fiscal years ending December 2019 to 2023 averaged 2.4x. Coca-Cola's operated at median net debt / ebitda of 2.4x from fiscal years ending December 2019 to 2023. Looking back at the last 5 years, Coca-Cola's net debt / ebitda peaked in December 2020 at 2.8x.
From a general point of view, having 1.715 of debt to EBITDA is considered low and generally acceptable by most industries standard. In some industries, even debt to EBITDA of 10 can be considered normal, while other fields may have a standard value of 3.
35% or less is generally viewed as favorable, and your debt is manageable. You likely have money remaining after paying monthly bills. 36% to 49% means your DTI ratio is adequate, but you have room for improvement. Lenders might ask for other eligibility requirements.
With a recent price-to-earnings (P/E) ratio below 9, and well below the five-year average of 26, AT&T's stock appears undervalued, and its dividend yield is quite attractive.
In the third quarter of 2023, AT&T reported revenue of $30.4 billion, a 1% increase compared to the same period a year prior. This growth is partly attributed to the company's expanding customer base, which has doubled to over 8 million subscribers in less than four years.
As of 2023, AT&T was ranked 13th on the Fortune 500 rankings of the largest United States corporations, with revenues of $120.7 billion. AT&T Inc. U.S.
What is Apple's EBITDA ratio?
Apple's operated at median ebitda margin of 32.8% from fiscal years ending September 2019 to 2023. Looking back at the last 5 years, Apple's ebitda margin peaked in December 2023 at 33.7%.
Analysis. T-Mobile US's net debt / ebitda for fiscal years ending December 2019 to 2023 averaged 3.1x. T-Mobile US's operated at median net debt / ebitda of 3.2x from fiscal years ending December 2019 to 2023. Looking back at the last 5 years, T-Mobile US's net debt / ebitda peaked in December 2020 at 3.4x.
A good EBITDA margin is relative because it depends on the company's industry, but generally an EBITDA margin of 10% or more is considered good. Naturally, a higher margin implies lower operating expenses relative to total revenue, while a low or below-average margin indicates problems with cash flow and profitability.
EBITDA fails to consider financing
Some experts consider EBITDA to be a useless metric because it does not take into account the company's debt expenses. EBITDA measures a company's performance before factoring in how it's financed, so using this metric alone may provide a less than complete view of the business.
As an example, if company A has $100 million in debt and $10 million in EBITDA, the debt-to-EBITDA ratio is 10. If company A pays off 50% of that debt in the next five years while increasing EBITDA to $25 million, the debt-to-EBITDA ratio falls to two.
Among the non-cash items not adjusted for in EBITDA are bad-debt allowances, inventory write-downs, and the cost of stock options granted. 3. Unlike proper measures of cash flow, it ignores changes in working capital.
EBITDA represents a company's core profitability by adding interest, tax, depreciation, and amortization expenses to net income. Meanwhile, operating income is a company's actual profits after subtracting its operational expenses or the costs of normal business operations.
Ideally, financial experts like to see a DTI of no more than 15 to 20 percent of your net income. For example, a family with a $250 car payment and $100 of monthly credit card payments, and $2,500 net income per month would have a DTI of 14 percent ($350/$2,500 = 0.14 or 14%).
The 28/36 rule dictates that you spend no more than 28 percent of your gross monthly income on housing costs and no more than 36 percent on all of your debt combined, including those housing costs.
Key takeaways
Debt-to-income ratio is your monthly debt obligations compared to your gross monthly income (before taxes), expressed as a percentage. A good debt-to-income ratio is less than or equal to 36%. Any debt-to-income ratio above 43% is considered to be too much debt.
Why is AT&T stock doing so badly?
AT&T stock (ticker: T) has dropped about 12% this year, while the S&P 500 index has tacked on nearly 18%. The company's quarterly earnings reports have been strong this year, but concerns over AT&T's potential liability regarding legacy lead-lined wires helped push shares to a 30-year low in July.
Is T a Buy, Sell or Hold? AT&T has a conensus rating of Moderate Buy which is based on 10 buy ratings, 5 hold ratings and 0 sell ratings. What is AT&T's price target? The average price target for AT&T is $27.25.
Deciding on AT&T stock
And we will do what is in the most and best interest of the shareholder." Given the company's current momentum, solid leadership under John Stankey, and attractive dividend with a robust 6% yield despite the cut in 2022, AT&T stock looks like a buy for 2024.
Factors in AT&T's net loss
Its old landline business was the culprit. The company's landline revenue is slowly withering away. AT&T's business and consumer wireline divisions saw 2022 revenue sink to $35.3 billion from $36.5 billion in 2021.
T – AT&T (T) is currently struggling with its debt burden and slowing wireless subscriber growth.
