AT&T Can Afford Its Dividend ... for Now
If forced to tighten its purse strings, reducing payouts to shareholders would be one of the most logical first moves.
Juggling a lot of balls.
Photographer: Michael Nagle/BloombergIt’s time to talk about AT&T Inc.’s beloved dividend.
To do that, we first need to talk about debt. This week’s sell-off in the bonds of another iconic American name — General Electric Co.— sent ripples through the wider credit market. Some highly regarded bond-fund managers warn of a reckoning for other U.S. investment-grade borrowers, in particular the “triple-Bs,” a group rated just above junk status that comprises a majority of S&P 500 companies. Among them is AT&T, which became the most indebted non-bank issuer after completing its takeover of Time Warner in June for a total value of $102 billion.