AT&T shares rose in early trading Tuesday after the wireless service provider outlined its near-term goals for profit growth and cash flow as it prepared to divest its stake in DirecTV and focus on expanding its 5G and fiber network.
AT&T (t) which divested its media assets in a $43 billion deal with Warner Bros. Discovery (W.B.D.) in 2022, is investing heavily in 5G fiber and wireless Internet services as part of its exclusive telecommunications strategy.
The Dallas group seeks to double its fiber network and expand its 5G network to 200 million homes, with 50 million fiber locations by 2029. It estimates capital investments at $22 billion over the next three years.
It also plans to defend its annual dividend, currently $1.11 per share, as part of its overall goal of returning $40 billion to shareholders through dividends and share buybacks over the same period.
AT&T also raised the lower end of its 2024 earnings forecast and now sees earnings in the region of $2.20 to $2.25 per share.
“Over the past four years, we have achieved durable and profitable subscriber growth, generated attractive returns on network investment and strengthened our balance sheet,” CEO John Stankey said in a statement.
“We are putting customers first to become the best connectivity provider in the United States. “Our plan expands the nation’s largest fiber network to more than 50 million total locations, modernizes our wireless network, and rewards our shareholders.”
Related: AT&T Sells Cable TV Provider Amid Streaming Service Acquisition
AT&T shares rose 3.35% in premarket trading to indicate an opening price of $23.46, a move that would extend the stock's gain in 2024 to around 35%.
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