The comment comes from the Mad Money host as a report from The Wall Street Journal revealed that AT&T Inc. (NYSE:T) will likely be the sole carrier for the much-anticipated Amazon.com, Inc. (NASDAQ:AMZN) 3D smartphone the internet commerce giant is expected to debut tomorrow. According to the report, people familiar with the plans for the Amazon.com, Inc. (NASDAQ:AMZN) smartphone say that AT&T will be tapped as the exclusive carrier for the smartphone which is projected to boost the network’s subscriber base and give it an advantage over rival networks in the U.S.
Cramer explained his opinion by saying:
“I like AT&T making a bold move because [their] stock has been stuck and they’re are doing an acquisition. Real pulse down there at AT&T. Verizon [is] back to almost to $50. I think that AT&T is a company that makes sense on a yield basis to give you a little growth.”
Cramer’s partner then replied by saying that he thinks AT&T Inc. (NYSE:T) is not a growth stock and that they are doing a deal because this is what they know how to do. To maintain their dividend and payout ratio, the company has to do the deal, he added. The carrier is set to acquire DIRECTV (NASDAQ:DTV) for $49 billion.
Cramer said, however, that AT&T Inc. (NYSE:T) needs to keep moving in this business. He added that if the carrier’s plan with Amazon.com, Inc. (NASDAQ:AMZN) takes off, people are going to be sitting asking how the two companies figured that deal would be beneficial for both companies.
The full discussion can be seen below.
Stockholders in AT&T Inc. (NYSE:T) includes Mario Gabelli’s GAMCO Investors, which had a 129,317 shares position in the company, valued at about $4.54 million, at the end of the first quarter. During the same period, Russell Lucas’ Lucas Capital Management also reported 114,921 shares of the carrier.
Amazon.com, Inc. (NASDAQ:AMZN) investors includes John Burbank’s Passport Capital, which held 97,746 shares by the end of March. Another shareholder is Sac Subsidiary’s CR Intrinsic Investors, which reported 69,001 shares in the company.