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ephemeral opportunity in AT&T and more +2

10:31 25-Jul-18


I don't usually cover household names, and don't plan to start with AT&T, but I do see the post-earnings reaction in T as overdone.  The move below $32 seems typical of over-leveraged positioning to me, and I would expect a correction back to that level in short term, certainly by the next dividend in early October.  Beyond that level, I see AT&T as a similar pick to Schlumberger... a good company with long-term troubles.  In particular the status of the DoJ's appeal on the Time Warner merger will need to be monitored.  If that threat falls away, a correction back to 5.5% yield or $36 seems reasonable.

Rounding out other news, we have CUI Global signing a MoU for global sales of its gas monitoring solutions, and Westport completing the sale of its natural gas compressor unit to Snam, which was announced back in May.  Note that latter could be a sign of progress for the former, and I that I like both stocks as GRoDT picks at current prices.

Energy Recovery has also announced another desalination deal in Egypt to the tune of $3.3M, with delivery expected in the fourth quarter.  I don't see this as having any potential to move the stock, and it isn't.

Similarly, we have an expansion of IDT's RapidIO technology.  This communication technology is big business and should drive growth, but the press release lacks any real detail and I join the market in dismissing the immediate impact.