AT&T Expands Collaboration with Google Cloud

Telecommunications company AT&T Inc. (T) recently announced to offer new solutions across AT&T’s 5G and Google Cloud’s edge computing portfolio. This expansion of collaboration follows over a year of partnership between AT&T and Google Cloud in developing solutions for enterprises.

Following the news release, shares of the company declined marginally to close at $29.02 in Tuesday’s trading session.

This coming together of AT&T’s Multi-access Edge Compute (MEC) solution and AT&T Network Edge capabilities through LTE, 5G, and wireline with Google Cloud aims to deliver dynamic and transformational abilities to sectors like retail, healthcare, manufacturing and entertainment.

While Google Cloud’s combination with AT&T’s MEC offers robust data management abilities, its combination with the company’s Network Edge system allows businesses to deliver a seamless experience to their customers.

The Chief Product and Platform Officer of AT&T Business, Rasesh Patel, said, “With premises-based 5G and network edge computing, we give our customers even greater control of where their data goes and how they use it – at higher speeds and with lower latency. These capabilities allow businesses to deliver unique experiences to their customers, today and into the future.” (See AT&T stock chart on TipRanks)

Recently, Redburn Partners analyst Stephen Malcolm initiated a Sell rating on the stock with a price target of $23 (20.7% downside potential).

The analyst said, “John Stankey’s reset of AT&T’s strategy and the dividend is breathtaking and welcome: it is hard to imagine a more comprehensive dismantling of his own heritage. However, this merely reduces risk for AT&T and does not in itself make the stock attractive. The downside risks include still high total liabilities, downside risk to returns, opaque accounting and overly optimistic guidance. Our fair value is $23, which represents 26% downside (excluding Warner Bros. Discovery at current value) to a still low 6.5% underlying FCF yield.”

Consensus among analysts is a Hold based on 6 Buys, 6 Holds, and 3 Sells. The average AT&T price target stands at $31.46, which implies upside potential of 8.4% from current levels. Shares have declined 4.3% over the past year.