2. AT&T Inc. (NYSE:T)
Berry Street Capital’s Stake Value In Q1 2022: $17.7 million
Percentage of Berry Street Capital’s 13F Portfolio In Q1 2022: 2%
Number of Hedge Fund Holders: 55
AT&T Inc. (NYSE:T) is an American telecommunications company that provides a wide variety of services such as call packages, broadband internet, handsets, and customer premises equipment. The company is headquartered in Dallas, Texas.
Berry Street Capital owned a $17.7 million stake in AT&T Inc. (NYSE:T) as part of its Q1 2022 holdings, which came in the form of 750,000 shares. The second quarter saw the firm remove this completely from its portfolio. Insider Monkey surveyed 895 hedge funds for their Q2 2022 investments and discovered that 55 had held a stake in the company.
AT&T Inc. (NYSE:T)’s share price has dropped by a painful 18% over the past twelve months, and the company isn’t seeing much love from Wall Street either. For instance, MoffettNathanson reduced its share price target to $17 from $19 in August 2022, stating that AT&T Inc. (NYSE:T)’s cash flows and dividends are being sacrificed for subscriber growth. AT&T Inc. (NYSE:T) currently pays a 28 cent dividend for a 6.6% yield.
AT&T Inc. (NYSE:T)’s largest investor in our database is D. E. Shaw’s D E Shaw which owns 11.4 million shares that are worth $239 million.
Argosy Investors mentioned the company in its Q2 2022 investor letter. Here is what the fund said:
“I purchased shares of AT&T Inc. (NYSE:T) prior to its spin-off of Warner Brothers Discovery (WBD). Most people are probably familiar with AT&T. They are a major cellular service provider, and until recently owner of the Time Warner media assets, which include HBO, CNN, TNT, TBS, Cartoon Network, DC Comics and the Batman content brands, and more. At the time of my purchase, I estimated that the combined T/WBD assets traded at a 15% levered FCF yield, or 6x FCF. I also believe that WBD, which now has HBO Max, has future growth in front of it which was previously in doubt when Discovery was primarily tied to the declining cable television bundle. Since then, Netflix reported disappointing subscriber growth, which threw all streaming companies into disarray. WBD followed that news with a disappointing outlook on its business during its own quarterly earnings.
As a result, shares of WBD have declined nearly 40% since the spin-off. WBD now trades for 7x 2023E FCF and there is great potential for returns over the next few years as WBD pays down debt used to finance its merger combining Warner Brothers and Discovery and grows. We do not own a large position in WBD at present, but we may add to it over time.”
