2023-07-03 06:20:00 ET
Tech stocks have generally done well this year, staging a solid recovery from a tough 2022. But not all tech stocks are created equal. AT&T (NYSE: T) looks like a bargain, while Apple (NASDAQ: AAPL) looks severely overpriced.
There are two core reasons to invest in AT&T stock: The valuation and the dividend. The stock price reflects an extreme amount of pessimism that looks overdone, and the dividend, while unlikely to grow quickly, has a sky-high yield.
AT&T expects to generate at least $16 billion of free cash flow this year despite a slower pace of wireless subscriber additions . With a market capitalization of $114 billion, the stock trades for roughly 7 times free cash flow. That looks like a bargain.
For further details see:
1 Tech Stock to Buy and 1 to Avoid