AT&T Inc (NYSE:T).'s Chief Financial Officer expressed optimism on Thursday regarding the company's full-year forecast for free cash flow, which is expected to surpass $16 billion. This announcement resulted in a 2.3% increase in the company's shares, hitting a two-month high during midday trading.
The current FactSet consensus anticipates AT&T's free cash flow for 2023 to reach approximately $17.23 billion. Free cash flow is a crucial financial indicator for companies, as it is utilized to finance dividend payments and share buybacks.
For the third quarter of 2023, AT&T projects its free cash flow to range between $4.5 billion and $5.0 billion. This forecast aligns closely with the FactSet consensus estimate of $4.95 billion.
Historically, AT&T has demonstrated a robust performance in generating free cash flow. As reported in July 2023, the telecommunications giant had generated $15.2 billion of free cash flow over the previous 12 months. During this time, it distributed dividends and other payments totalling $9.3 billion.
Presently, AT&T pays an annual dividend of $1.11 per share. Based on current stock prices, this represents a dividend yield of 7.42%. This figure places AT&T as the fourth-highest yielding stock in the S&P 500, significantly exceeding the S&P 500’s average implied yield of 1.53%.
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