Telecom Titan to Rise Again?

Published on
June 28th, 2018
10 minutes

Telecom Titan to Rise Again?

Trade Ideas ·
Featuring Colin Gillis

Published on: June 28th, 2018 • Duration: 10 minutes

Colin Gillis, director of research at Chatham Road Partners, explains why consolidation in the media landscape stands to benefit AT&T. He provides analysis of the telecom industry, and lays out the trade, in this interview with Brian Price. Filmed on June 25, 2018.


  • JD
    Joe D.
    5 July 2018 @ 23:34
    In theory, practice and theory are the same.
  • YB
    Yuriy B.
    28 June 2018 @ 11:01
    Minimal downside risk? AT&T now has $250 billion of debt. Just because Disney & Comcast are chasing similarly a overpriced asset does not make AT&T's acquisition smart in absolute terms. Maybe AT&T's stock goes up a bit in the short-term, but AT&T is a bloated whale already. Swallowing a few big sharks won't make it healthier in the long-term. As Peter Lynch once put it so succinctly: de-worse-ification.
    • CM
      C M.
      28 June 2018 @ 15:27
      Agree. Huge amount of debt. Ranks #32 in world if ATT was a country (between Indonesia and UAE on a debt basis). Company is profiled in Jim Grant's newsletter this week (negative on their bonds in particular). Colin says they need to execute. Couldn't agree more in merging too dissimilar cultures. Studies have shown that the majority of these types of mergers tend to underperform the market due to the difficulty in execution.
    • BK
      Brian K.
      30 June 2018 @ 14:05
      Bloomberg said 185b debt after the time warner purchase
  • LT
    Lucas T.
    30 June 2018 @ 00:17
    Seems that usually the time horizons are so long as to be almost worthless...if it hits your target in a month, you were right, if it hasn't hit it in a year, everyone forgets anyways.
  • MS
    Michael S.
    29 June 2018 @ 03:28
    I remember T selling the "bundle" thing back in the .com bubble, and it sounded like a great, conservative, dividend-paying way to play cellular, cable, landlines, etc. It dropped 30-40% anyway, 2000-2003, and then they then "spun off" all those companies, to "fully value" those assets as separate companies. Now they are trying a different bundle, to compete with Google, Verizon, Netflix, Apple, etc.? Hmmm. All that said, I typically love buying stocks when the P/E is the same as the dividend yield. That 1/1 ratio is really nice. It can be a really crappy story, with too much debt, and still work out.
  • JZ
    Josh Z.
    28 June 2018 @ 17:42
    Verizon bought AOL in 2015 on a similar thesis, but hasn’t quite outperformed T by that much. Would like to hear his take on that as well
    • CM
      C M.
      28 June 2018 @ 23:32
      Verizon announced today they are shutting down their video streaming app Go90. Company is taking a different path vs ATT.
  • PP
    Patrick P.
    28 June 2018 @ 18:19
    Doppleganger....they are both named "Colin"